Market manipulation not found, says FERC
The Federal Electricity Regulatory Commission (FERC) has said that it found no direct evidence of market manipulation in its investigation of the June electricity market crisis. Some questionable practices have been identified, however, including discriminatory practices by transmission system operators.
FERC recently presented its report on the events of June 22 – 26 to Congress, and concluded that the price spikes were caused by a combination of a shortage of power and an unexpected heatwave. It believes that the crisis was a freak occurrence that is unlikely to recur, and that no major changes to the system need to be made.
In its report, FERC says that some neighbouring utilities took advantage of the situation to make money. Of particular concern to FERC was the fact that some utilities prevented other utilities from using their transmission systems to deliver power. These offending utilities, which have not been named, were then able to deliver the power needed themselves at a large premium.
The report was carried out after several utilities affected by the price spikes expressed concerns over the stability of the system. Prices spiked to a high of $7500/MWh on June 25 and utilities have reported losses or charges totalling more than $500m as a direct result.