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Our Opinion: Every victory helps

April 18, 2001

Local geothermal company CalEnergy did not come close to getting everything it wanted during a hearing Monday in Imperial County Superior Court regarding its lawsuit against Southern California Edison. The day may have gone to some extent to Edison, which won a 60-day reprieve on the lawsuit.

CalEnergy did get one court victory. Superior Court Judge Donal Donnelly upheld his March 22 decision that allowed CalEnergy to suspend its contract with Edison and sell its power on the open market, a move that has enabled CalEnergy — at least in part — to meet its debt owed in Imperial County. Donnelly held to his decision despite pressure from Edison that he reconsider.

The victory for CalEnergy is twofold. First the company can continue to sell its power on the open market, which keeps it in business. Second, Donnelly has continued to recognize that despite Edison's move to pay for the power on a "going forward" basis, the issue of back payments has not been addressed. If Donnelly had reconsidered his March 22 decision, it is possible the door would have been closed on CalEnergy's argument that it is owed at least $120 million in back payments dating back to November.


During the hearing Monday, Edison did its best to portray itself as a victim. We have a hard time believing that. Edison accepted power from CalEnergy and other renewable energy providers but did not pay for that power for five months. That is wrong and Edison needs to make those payments.

We want CalEnergy and Edison to continue their 10-year contractual agreement. It has been a good relationship, one that assured CalEnergy power remained in California. With CalEnergy selling its power on the open market, there is no guarantee that power will remain in the state.

Edison may have been the big winner Monday because it won that 60-day delay. During the hearing Edison made some allegations about El Paso Merchant Energy, the company that is a 50 percent owner of the CalEnergy plants in the Valley. Edison attorneys asked for more time to follow through with discovery on those allegations.

We sense that is merely a delay tactic, but we look forward to the results of the discovery. Still, we tend to think that delay will give Edison enough time to obtain some other court action that would block Donnelly from ruling in the CalEnergy lawsuit.

That is probably what Edison is trying to do.

We have a sense the court battle between CalEnergy and Edison is just beginning.

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