FERC investigating MISO auction over market manipulation allegations
- The Federal Energy Regulatory Commission (FERC) launched an investigation into the Midcontinent ISO's April capacity auction that stakeholders claimed upped Zone 4 prices 9-fold higher than other zones, RTO Insider reports. Illinois makes up most of Zone 4.
- The Illinois Attorney General Office, Southwestern Electric Cooperative, Ameren Illinois and Public Citizens Inc. filed complaints in the months after the auction, calling for an investigation after prices in Zone 4 cleared $150/MW-day compared to $16.75/MW-day during the same period last year. They believe the price increase is linked to Dynegy's "manipulation of power auctions."
- FERC plans to hold a technical conference on Oct. 20 to address the situation. Participants affected have until Nov. 4 to submit comments after the conference.
A jump in prices sparked concerns -- and launched a probe -- into major Texas-based utility Dynegy's actions in the April MISO's capacity auction. Consumer watchdog Public Citizen alleged that the generation company withheld several power plants from the auction or bid them at non-competitive prices.
Illinois Attorney General Lisa Madigan joined up with Public Citizen to ask federal regulators to halt the subsequent rate increase and investigate the utility. Several other stakeholders, including Ameren Illinois and Southwestern Electric Co-op joined up, saying the spike violated the Federal Power Act's requirement that prices must be just and reasonable.
Dynegy defended its actions, claiming it "offered all of its megawatts into the MISO auction with no physical or economic withholding in accordance with MISO tariffs and as approved by the Independent Market Monitor."
MISO and its Market Monitor also fended off the allegations saying that the auction followed the commission-approved rules, RTO Insider reports.
“Those higher prices are the source of complainants’ discontent. However, MISO conducted the auction exactly as required under its Tariff, and none of the complainants provides any evidence to the contrary. Accordingly, these complaints should be dismissed with prejudice,” MISO said in its filing.
FERC said the Oct. 20 conference will not address the non-public investigation by its Office of Enforcement over supposed market manipulation. FERC said its investigation began "shortly after" the auction finished in April 14.
- RTO Insider FERC launches probe into MISO capacity auction
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