California won a round Monday in its seemingly endless quest to win billions of energy-crisis refunds, the Sacramento Bee reports.

The U.S. Supreme Court upheld a lower-court ruling that said federal regulators should have been more vigilant when California’s electricity market went haywire in 2000-01.

The ruling stems from a lawsuit the state filed against the Federal Energy Regulatory Commission, accusing the agency of stiff-arming California’s demands for refunds. The suit said FERC violated its own rules under which the agency was supposed to monitor electricity sales in California to make sure prices were fair.

As part of the deregulation scheme, the investor-owned utilities purchased most of their power from a variety of generators and other sellers.

In 2004, the 9th U.S. Circuit Court of Appeals ruled in California’s favor, saying FERC had been lax in monitoring the market. On Monday the Supreme Court declined to hear an appeal of that ruling.

Although power sellers could charge market-based rates in California, federal law required that prices be “just and reasonable.” California argues that it was overcharged by about $9 billion; it has obtained settlements totalling $5.5 billion, said Erik Saltmarsh, head of the state’s Electricity Oversight Board.

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