FERC ALJ Decides Motions of Parties Seeking Role in Proposing to FERC Uses of Disgorged $78 Million NYISO Market Gaming Profits, Clarifies Process.

On July 11, 2012, a FERC ALJ decided motions regarding "eligiblity" of parties to recommend how FERC will allocate disgorged profits from alleged gaming of NYISO electricity markets.  The fund is for the benefit of electricity consumers.  See New York Formulating Plans to Use $78 Million Disgorged by Energy Trader for the Benefit of Electricity Consumers, PULP Network, June 116, 2012.


In the order beginning the case, FERC said recommendations for apportionment of the money “may only be made by the appropriate state agency or agencies of those respective states, including, for example, state public service commissions, state attorneys general, or state consumer advocates, for the benefit of electric energy consumers.In rejecting motions from out of state parties, non-state agencies, and non-consumer interests, the ALJ clarified the process.  A New York power generator,IES, had sought eligibility status, which was opposed by several parties, including AAEP.  The ALJ stated:

On May 15, 2012, AARP filed an opposition to IES to be eligible for funds in the
NYISO and ISO-NE region. AARP noted that the Commission ordered that the funds in
this proceeding are to be allocated for the benefit of electric energy consumers, and thus,
are not intended for a party such as IES, a power producer and seller. AARP noted thatthe proper role of any party representing consumer interests that does not qualify as an eligible state agency is to convey their recommendations to the eligible state agencies, as AARP and other consumer groups are doing. IES disagreed with this recommendation in their May 30, 2012 response, but IES did agree with AARP’s connotation that IES is a “party representing consumer interests that does not qualify as an ‘eligible’ state agency in this proceeding.”
* * * *
AARP is correct in noting that the proper role of any party to this proceeding
representing consumer interests of market participants harmed by the market distortions
created by CCG’s manipulative practices that does not qualify as an ‘eligible’ state
agency in this proceeding is to convey its concerns and recommendations to the
appropriate state agencies that do meet the Commission’s criteria for eligibility to
participate in requests for apportionment of the Fund, as AARP and other consumer
groups are doing. Further, any such party will be permitted to file comments should itbecome necessary and appropriate to do so to address the allocation and distributionmethodology ultimately proposed by the eligible state agencies. Any such comments
must be submitted within fifteen (15) days of the filing date of the proposed allocation
and distribution process to which the comments are intended to pertain.

AARP and other consumer groups have urged New York agencies, and the governor, to use a portion of the $78 million fund for customer assistance to reduce service terminations, for energy efficiency, and for enhanced utility consumer advocacy.