Judge won't stay FERC's order against NRG

NEW YORK -- - A federal judge has denied a motion by NRG, the bankrupt unit of Xcel Energy Inc. aimed at allowing it to stop supplying electricity to utility Connecticut Light and Power.

In his ruling, U.S. District Judge Richard Casey said he did not have jurisdiction to stay an order by the Federal Energy Regulatory Commission forcing NRG to resume service to the Connecticut utility. He said FERC actions are only reviewable by a federal court of appeals.

The litigation stems from NRG's efforts to break a three-year agreement originally set to expire at the end of the year, claiming that it is losing about $500,000 a day. The October 1999 agreement required NRG to supply a certain amount of energy to the utility at a fixed price until Dec. 31, 2003.

Shortly after the service began, a dispute arose between the parties over which entity was liable for certain charges. NRG claims that the utility is in default for the charges and on May 14 gave notice it would terminate the contract.

The same day, NRG filed for bankruptcy protection.

Shortly afterwards, Connecticut's attorney general petitioned the FERC to stop NRG from ending the contract. On May 16, the regulatory agency said it had insufficient time to evaluate the situation and told NRG to continue providing service.

However, on June 2, the bankruptcy court overseeing NRG's Chapter 11 proceedings said NRG could reject the agreement.

Last week, FERC issued a second order requiring NRG to provide service to Connecticut Light pending its final order. NRG responded that it would not do so because the bankruptcy court allowed it to reject the agreement.

It then sought an order from the district court staying FERC's order until a court makes a final review of the regulatory action.