By Ben Geman - 08/11/13 12:51 PM EDT
Nearly a billion dollars in penalties against two Wall Street giants show that a 2005 law that handed the Federal Energy Regulatory Commission (FERC) new enforcement powers is bearing fruit, a FERC commissioner said.
“I think probably the reason that it is coming together now is that [the Energy Policy Act of 2005] really changed the landscape as far as FERC’s jurisdiction and our authority over some of these areas,” Tony Clark, a Republican member of FERC, said on Platts Energy Week TV.
FERC and JP Morgan in late July reached a $410 million consent agreement in late July to resolve allegations of electricity market manipulation in California and the Midwest between 2010 and 2012.
The regulator in mid-July ordered Barclays and four of its traders to pay $453 million for allegedly gaming western state power markets between 2006 and 2008, but the company is vowing to contest the charges in court.
“It takes a few years to build up the analytical ability, the staff, the capability to bring cases like that and now you are starting to see the first, basically, tranche of these cases that are coming about really because FERC has been able to step up its enforcement authority and start bringing some of these cases,” he said in the interview broadcast Sunday.
“They are very complex cases, they take a good deal of time to put together, so you are starting to see some of these come through right now,” added Clark, whose term began in June of 2012.
In addition to the JP Morgan and Barclays cases, FERC this month said it would seek $29 million in penalties against BP for alleged natural gas market manipulation
The cases are part of the commission's more muscular enforcement efforts dating back to last year.