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FERC Increases Maximum Civil Monetary Penalties for Power, Gas and Oil Companies

On June 29, 2016, the Federal Energy Regulatory Commission (the “Commission”) issued an interim final rule amending the civil monetary penalties within its jurisdiction to adjust for inflation. FERC adjusted its penalties pursuant to its statutory obligation under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the “ 2015 Adjustment Act”).  The Act requires each federal agency to adjust for inflation each civil monetary penalty within the agency’s jurisdiction by July 1, 2016 and to continue to update each penalty annually every January 15th.  The Commission explained that the interim final rule is not subject to notice and comment rulemaking because the adjustments are statutorily required and not subject to the agency’s discretion. 

Pursuant to the methodology prescribed by the 2015 Adjustment Act, the Commission increased maximum civil monetary penalties for manipulation violations under the Federal Power Act, Natural Gas Act and Natural Gas Policy Act from $1 million to $1,193,970 per violation, per day.  It also increased the other civil monetary penalties over which it has jurisdiction, including for certain Interstate Commerce Act violations that had not been updated since 1910 and other Federal Power Act violations.  The Commission summarized all the adjustments in a table incorporated into the interim final rule, which we separately attach to this summary. 

Finally, FERC also noted in the interim final rule, that the 2015 Adjustment Act directed that agencies, including the Commission, shall use the civil monetary penalty applicable at the time of assessment of a civil penalty, regardless of the date that the violation occurred. 

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© Copyright 2021 Cadwalader, Wickersham & Taft LLPNational Law Review, Volume VI, Number 188
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George D. Billinson, Cadwalader, electric markets lawyer, natural gas utilities attorney
Partner

With more than 30 years of experience, George D. Billinson focuses his practice on complex energy and commodities litigation, as well as regulatory and antitrust matters. George represents and counsels electric and natural gas utilities, natural gas producers, and gas and power marketers in a range of U.S. Federal Energy Regulatory Commission (FERC) and Commodity Futures Trading Commission (CFTC) compliance and enforcement matters, including investigations, audits, and litigation. He also performs compliance assessments and helps clients develop and implement compliance...

202 862 2411
Mark Haskell, Cadwallader Law Firm, Energy and Commodities Attorney
Partner

Mark R. Haskell advises clients on matters related to the U.S. Federal Energy Regulatory Commission (FERC), including FERC investigations, litigation and related court appeals, and Commodity Futures Trading Commission (CFTC) investigations affecting the energy industry. Mark represents natural gas and power marketers, local distribution companies, end users, producers, industrial consumers, and liquefied natural gas (LNG) and shale gas developers in energy regulatory matters.

As a natural gas litigator, Mark handles...

202-862-2407
Thomas Reid Millar, Cadwalader, regulatory proceedings Attorney, FERC electric matters lawyer
Associate

Tom Millar focuses his practice on representing energy and commodity companies and financial institutions in a variety of investigatory, transactional and regulatory matters. He regularly assists clients in regulatory proceedings before FERC on electric matters, including general rulemakings, ISO/RTO proceedings, and Federal Power Act Section 203 and 205 proceedings.

Tom’s energy and commodity clients value the insight his litigation background offers in regulatory and investigatory matters. Among his most significant and high-profile...

202 862 2334
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