Docket No. AD07-13-015
Item A-3
Staff Presentation | Report
FERC’s energy market enforcement activity increased in fiscal year 2021, with the opening of 12 new investigations and the negotiation of eight settlements totaling $6.4 million in disgorgement and penalties, according to the 2021 Annual Report on Enforcement.
This year’s report is the 15th such report produced by FERC’s Office of Enforcement. The report provides a comprehensive overview of the Office of Enforcement’s accomplishments over the past year, including significant actions, strategic goals, and advice to industry.
And, FERC Chairman Rich Glick says, it reflects the importance that the Commission must continue to place on ensuring all energy markets are fair and protect consumers.
“When I became Chairman of the Commission last January, one of my top priorities was to ensure vigorous oversight and enforcement of the Commission-regulated markets,” Chairman Glick said. “I cannot stress this enough. We must deter market manipulation and protect consumers through vigorous enforcement of Commission and market rules.”
In FY2021, Enforcement’s work focused on fraud and market manipulation, serious violations of Reliability Standards, anticompetitive conduct, threats to the nation’s energy infrastructure and associated effects on the environment and surrounding communities, and conduct that threatens the transparency of regulated markets.
Division of Investigations (DOI) staff opened 12 new investigations, bringing four pending investigations to closure without further action. Of the $6.4 million negotiated in the eight settlements this fiscal year, $4.6 million involved civil penalties and $1.8 million involved disgorgement. Six of those settlements included compliance monitoring requirements.
Division of Audits and Accounting staff completed 12 audits of public utility, natural gas and oil companies on an array of topics, resulting in 64 findings of noncompliance and 250 recommendations for corrective action, the majority of which were implemented within six months. They also directed $18.5 million in refunds and other recoveries. Accounting staff used delegated authority to decide, or advised the Commission in, 432 proceedings involving accounting matters. Finally, staff assessed for timeliness and accuracy Electric Quarterly Reports received from nearly 2,900 entities each quarter and approximately 2,600 annual financial reporting form submittals.
Division of Analytics and Surveillance (DAS) staff identified and reviewed numerous instances of potential misconduct.
Among them were a comprehensive review of wholesale natural gas and electricity market activity associated with the February 2021 winter storm Uri to determine if any market participants engaged in market manipulation or other violations. As a result of its review, DAS referred two matters to DOI for investigation. DAS staff also reviewed more than 2.6 million market-based rate transactions and analyzed the combined results of 25 statistical indicators to detect potential instances of the exercise of market power. DAS also provided analytical support on 40 investigations with DOI and 15 other matters involving inquiries or litigation.
R22-8