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California power company loses appeal to cap wholesale prices
LOS ANGELES, California (CNN) -- One of the two largest utilities in California lost an appeal in court Friday -- and then announced significant layoffs.
The U.S. Court of Appeals in Washington denied a petition by Southern California Edison to order the Federal Energy Regulatory Commission (FERC) to cap wholesale electricity prices, which have skyrocketed in recent months in California's deregulated energy market.
The commission had argued that California's electricity-buying practices were largely to blame and the request would not solve the crisis.
The three-judge panel said Southern California Edison "has not demonstrated that its right to this relief is clear and indisputable."
The utility officials issued a statement expressing disappointment at the court's opinion and urged the FERC to act on their petition for a rehearing.
Edison officials also announced Friday that the utility will lay off 1,450 workers as part of several efforts to save $465 million. Stephen Frank, Edison president and chief executive officer, said in a statement that maintaining basic service levels for the 11 million Californians served by Edison would be an "extremely challenging task" with the utility's remaining resources.
California's Public Utilities Commission voted Thursday to raise electric rates 7 per cent to 15 percent. Edison International and Pacific Gas and Electric had requested rate increases near 30 percent.
Shares of both utilities took hits Thursday after receiving downgraded credit ratings from key agencies.
California guaranteed power for another week
US Securities and Exchange Commission
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