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Powered by the attorneys of Bracewell & Giuliani, Energy Legal Blog® is your resource for updates and analysis on national and global energy issues.
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  1. FERC Finds Manipulation Violations by Company and Trader that Complied with Tariff but did not Act to Further Market Design Goals

    Friday, May 29, 2015 2:50 pm by and

    On May 29, 2014, the Federal Energy Regulatory Commission (FERC) issued an Order Assessing Civil Penalties against Powhatan Energy Fund and its affiliates as well as against Houlian Chen, Powhatan’s chief trader, for violating FERC’s anti-manipulation rule. FERC ordered Powhatan to pay $28.8 million in penalties and over $4.7 million in disgorgement and it ordered Chen to pay an additional $1 million penalty. In this assessment order, FERC rejected all of Powhatan’s arguments and instead adopted the Division of Enforcement’s recommendations on the facts, the law and the penalty amounts. The Order directs Powhatan and Chen to pay the penalties and the disgorgement amounts within 60 days of the date of the order. Similar to the Barclays case currently pending in federal district court in California, because Powhatan previously elected to have the matter heard de novo in federal district court, if Powhatan and Chen fail to pay, FERC must go to federal district court to enforce its penalty assessment.

    (more…)


  2. Federal District Court Denies Barclays Motion to Dismiss FERC Petition Which Alleges Manipulation and Assesses Significant Penalties

    Thursday, May 21, 2015 2:02 pm by , , and

    For the past two years we have been tracking and reporting on an enforcement proceeding brought by the Federal Energy Regulatory Commission (“FERC”) against Barclays Bank PLC (“Barclays”), Daniel Brin, Scott Connelly, Karen Levine, and Ryan Smith (collectively, the “Traders” and together with Barclays, “Defendants”) for alleged manipulative trading in the western electricity markets from November 2006 to December 2008. Yesterday, the United States District Court for the Eastern District of California denied a motion by the Defendants to dismiss the manipulation action. Although the court’s order did not address the merits of the manipulation charge, the court’s order is significant because it is the first judicial ruling on the scope of FERC’s enforcement authority over the physical electricity markets and the court found that FERC can pursue civil penalty actions against individuals as well as companies. (more…)


  3. FERC Approved Settlement with Twin Cities

    Tuesday, December 30, 2014 3:07 pm by

    On December 30,2014, the Commission approved four Stipulation and Consent Agreements (Agreements) between the Office of Enforcement (Enforcement) and Twin Cities Power – Canada, Ltd., Twin Cities Energy, LLC, and Twin Cities Power, LLC (collectively, Twin Cities), and Jason F. Vaccaro, Allan Cho, and Gaurav Sharma (collectively, the Traders).  Enforcement accused Twin Cities and the Traders of violating the Commission’s anti-manipulation rule by manipulating electricity prices in the Midcontinent Independent System Operator, Inc. (MISO) from January 2010 through January 2011 in order to benefit their related financial positions.  Twin Cities admitted the violations and agreed to pay a civil penalty of $2,500,000 and disgorgement of $978,186 plus interest. Twin Cities will also implement measures designed to ensure compliance in the future, including submitting compliance reports for four years.

    The Traders neither admit nor deny the violations and agreed to pay the following civil penalties: Jason Vaccaro, $400,000, Allan Cho, $275,000, Gaurav Sharma, $75,000. Additionally, the Traders agreed to physical trading bans as follows: Jason Vaccaro for five years, Allan Cho for four years, Gaurav Sharma for four years.  The Traders will also implement measures designed to ensure compliance in the future, including submitting compliance reports. (more…)


  4. FERC Orders ISOs to Address Fuel Assurance Issues 149 FERC ¶ 61,145 (2014)

    Thursday, November 20, 2014 5:31 pm by

    In an order issued on November 20, 2014, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) directs regional transmission organizations and independent system operators (“ISOs”) to file a report on the status of how their market rules address fuel assurance challenges.  ISOs have 90 days from the date of the Commission’s order to evaluate the specific fuel assurance challenges they may experience and prepare a report that comprehensively describes the actions they have already undertaken, and/or propose to undertake, in response to their unique fuel assurance concerns. (more…)


  5. PJM Sets Out Framework For Continued Participation Of Demand Response In Wholesale Markets Following EPSA

    Friday, October 10, 2014 2:35 pm by

    On October 7, 2014, PJM Interconnection, L.L.C. (“PJM”) filed with the Federal Energy Regulatory Commission (“FERC”) a blueprint for the continued participation of demand response resources in its markets in the wake of the United States Court of Appeals for the D.C. Circuit’s decision in Electric Power Supply Ass’n v. Fed. Energy Reg. Comm’n, 753 F.3d 216 (D.C. Cir. 2014) (“EPSA”).  In that case, the D.C. Circuit vacated Order No. 745, FERC’s rule governing the compensation of demand response resources in wholesale energy markets on the basis that the rule encroached upon state jurisdiction over retail sales.  The court’s opinion casts significant doubt on FERC’s authority to require transmission providers to allow demand response to participate in their markets, with some wondering whether there is any room left for demand response in wholesale markets at all.  (more…)


  6. FERC Issues Another Notice of Alleged Violations Concerning Up To Congestion Trades

    Wednesday, August 27, 2014 2:29 pm by

    On August 25, 2014, staff at the Federal Energy Regulatory Commission (FERC Enforcement)  issued a Notice of Alleged Violations (NAV) against City Power Marketing, LLC, and its principal owner, K. Stephen Tsingas.  The Notice said that FERC Enforcement has preliminarily determined that City Power and Tsingas violated the Commission’s Anti-manipulation rule through Up To Congestion (UTC) trading in the PJM market.  FERC Enforcement has defined UTC as “a virtual product that earns or loses money on the change between the Day ahead market and the Real time market of the spread in prices between two price nodes in PJM’s system.”  See Preliminary Findings of Enforcement Staff’s Investigation in Powhatan Energy Fund, LLC, http://ferclitigation.com/wp-content/uploads/0005-FERC-Preliminary-Findings-August-9-2013-2002899_1.pdf.  FERC Enforcement also alleged that City Power made false statements and omitted material information during the investigation.  (more…)


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