Public Utility District No. 1 v. IDACORP Inc.

dissenting, in part.

I agree with the majority’s opinion, but for the decision to allow Grays Harbor to amend its complaint.

My colleagues carefully and correctly show that Grays Harbor’s contract-related claims are preempted because they trigger the exclusive jurisdiction of FERC. They explain that the Federal Power Act (“FPA”) delegates to FERC “exclusive authority to regulate the transmission and sale at wholesale of electric energy in interstate commerce.” New England Power Co. v. New Hampshire, 455 U.S. 331, 340 , 102 S.Ct. 1096 , 71 L.Ed.2d 188 (1982). They, however, would permit Grays Harbor to amend its complaint because offering declaratory relief as to contract formation “would not necessarily intrude upon the rate-setting jurisdiction of FERC.”

I question the factual basis of this assertion. Grays Harbor cannot escape preemption by restating a claim that is based on “dysfunctional markets, market manipulation and the intentional withholding of generation capacity from the market.” We recently held that a lawsuit by the State of California to enforce its unfair competition laws against producers that engaged in fraudulent energy transactions was preempted because…

This dispute arises out of the West Coast’s recent energy crisis. The case involves contract-related claims against energy wholesalers by a public utility which contends it was forced to pay exorbitant prices for electricity. The utility’s case was dismissed by the district court because its claims were found to be preempted. For the reasons discussed below, we affirm in part and remand.

*645 BACKGROUND

Appellant Public Utility District No. 1 of Grays Harbor County, Washington (“Grays Harbor”) is a public utility district that provides retail electric power services to residential, commercial, and government customers within Grays Harbor County, Washington. Appellees Idaho Power Company and IDACORP Energy L.P. market and sell electric power in the wholesale markets of the Pacific Northwest. Appellee IDACORP Inc. is the holding company for both Idaho Power Company and IDACORP Energy L.P., and it is also the general partner of IDA-CORP Energy L.P.

At the center of this dispute is a contract for power. On or about March 19, 2001, Grays Harbor entered into a 20 megawatt purchase transaction with Idaho Power Company for the purchase of electric power from October 1, 2001 through…