Bracewell & Giuliani

Powered by the attorneys of Bracewell & Giuliani, Energy Legal Blog® is your resource for updates and analysis on national and global energy issues.
  1. FERC Proposes To Expand Classes Of Information Collected From Participants In RTO And ISO Markets

    Tuesday, September 22, 2015 3:13 pm by and

    On September 17, 2015, the Federal Energy Regulatory Commission (“FERC”) issued a notice of proposed rulemaking (“NOPR”) proposing to significantly expand the information that entities would be required to disclose in order to participate in the wholesale markets administered by Regional Transmission Organizations (“RTO”) and Independent System Operators (“ISO”).  Notably, while market participants already are required to disclose certain affiliate relationships to the RTOs and ISOs in which they participate, FERC’s proposal would require market participants to provide additional information regarding a broad array of contractual, employee, and other business relationships.  (more…)

  2. Monthly Futures Exchange Issuance Report: August 2015

    Friday, September 11, 2015 8:38 am by , , and

    August’s Highlight

    This past month, the NYMEX Business Conduct Committee (“Panel”) entered into a settlement with an entity to resolve alleged violations of Exchange Rule 526- Block Trades and two Market Regulation Advisory Notices, RA1326-4 and RA-1327-4, related to pre-hedging of block trades.  The settlement resulted in a fine of $50,000 and disgorgement of $51,315.60 in profits, as well as a $15,000 fine and 5-day suspension against the individual trader involved.

    Specifically, the Panel found that on four different trade dates the trader pre-hedged block trades by “trading on Globex prior to consummating the block trade with the counterparty.”  The hedge was placed after soliciting but before consummating the block trade and locked in a profit.  The trader also failed to timely report two of the block trades. (more…)

  3. BP Initial Decision: The Significance of Change

    Wednesday, August 19, 2015 8:10 am by , , and

    On August 13, 2015, the administrative law judge (“ALJ”) assigned to hear evidence in BP America Inc. et. Al (Docket No. IN13-15) issued an Initial Decision in which she found that BP America Inc., and certain of its affiliates (collectively “BP”) engaged in market manipulation by intentionally trading to influence index prices to benefit a related financial position.  Putting aside the merits of the BP case, the Initial Decision is a good reminder of the kind of circumstantial evidence that regulators might interpret as indicia of manipulation.  The reoccurring theme is CHANGE.  (more…)

  4. BP Initial Decision Adopts FERC Staff’s Positions

    Tuesday, August 18, 2015 1:17 pm by , , and

    Seven years after the Federal Energy Regulatory Commission (“FERC” or the “Commission”) first opened an investigation into the trading practices of BP America Inc. and certain of its affiliates (collectively “BP”), on August, 13, 2015, Administrative Law Judge Carmen Cintron (“ALJ Cintron”) issued her Initial Decision in the case of BP America Inc., finding that “BP engaged in market manipulation” by “intentionally [selling] large volumes of next-day physical gas at HSC in a way designed to benefit their corresponding short financial positions.”[1]  ALJ Cintron agreed with FERC Staff on all the material issues in the case, disagreeing with BP that FERC did not have jurisdiction over the case and finding BP’s defenses unpersuasive. (more…)

  5. Scope of Trial De Novo Debated in Barclays Electricity Manipulation Case

    Wednesday, June 24, 2015 4:34 pm by , and

    After almost eight years since the Federal Energy Regulatory Commission (FERC) commenced its investigation against Barclays Bank PLC (Barclays) and four of its traders, Scott Connelly, Daniel Brin, Karen Levine and Ryan Smith, for allegedly manipulating the California electricity markets, Barclays filed its answer in federal district court. As expected, Barclays denied all of FERC’s substantive allegations and asserted that the District Court should give no merit to FERC’s findings of fact or legal conclusions. FERC, according to Barclays and the individual traders, must prove its case before an independent arbiter and cannot rely on anything that happened at the agency level. FERC is seeking a $435 million civil penalty against Barclays; $15 million against Connelly; and $1 million each from Brin and Levine. (more…)

  6. FERC Accepts PJM Capacity Performance Proposal

    Tuesday, June 16, 2015 2:36 pm by , and

    On June 9, 2015, FERC issued an order accepting PJM’s proposal to modify its forward capacity market, the Reliability Pricing Model (“RPM”), to establish a new capacity product, the Capacity Performance Resource.  PJM’s proposal is designed to tighten the performance standards applicable to resources that receive a capacity obligation through the RPM and is intended to address poor resource performance that has been experienced since implementation of the RPM, especially during the 2014 polar vortex.

    Once implemented, PJM’s proposal will impose more stringent performance standards on resources that receive a capacity obligation through the RPM, including imposing non-performance charges when resources fail to perform and bonus payments for over-performance. All capacity resources will be eligible to offer as Capacity Performance Resources, and demand resources, energy efficiency resources, capacity storage resources, and intermittent resources will be allowed to aggregate their capabilities in order to reliably perform during emergency conditions. A Non-Performance Charge will be assessed on resources who fail to perform during system emergencies. (more…)

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