Client Alert

FERC Set To Revoke Energy-Trading Privileges of Marketers Involved in Widespread Price Manipulation in Western Markets

April 01, 2003

Energy Practice Group

As a possible portent of the future, on March 26th, the Federal Energy Regulatory Commission issued “show cause” orders to Enron Power Marketing, Inc., Enron Energy Services, Inc., Reliant Energy Services, Inc., and BP Energy Company, requiring that the power marketers show cause to the Commission why their authority to sell power at market-based rates should not be revoked. The Commission’s actions were the first in response to the Commission Staff ’s Final Report on Price Manipulation in Western Markets,which contained several  recommendations to the Commission, including that the Commission direct 37 power marketers to show cause why the Commission should not force them to disgorge profits and revoke their market-based rate authority because of their alleged involvement in price manipulation schemes in violation of California ISO and PX tariffs affecting electricity prices in Western markets.

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