US Consumers Not safe From Energy Abuse

WASHINGTON, DC -- The top U.S. energy market regulator needs more authority to levy harsh penalties on companies that manipulate electricity markets, an industry report said on Thursday.

It recommended that Congress authorize the Federal Energy Regulatory Commission to impose "adequate civil penalties" on energy firms for illegal conduct and order refunds for consumers that were overcharged for electricity.

"FERC's inability to extend penalties for market power abuse beyond what is currently allowed is insufficient to protect consumers," said the report by public interest group Consumer Energy Council of America.

The report, on how to create a national electric power market that will benefit consumers, said rolling blackouts in California, power price spikes, the collapse of Enron and related corporate scandals have stalled deregulation of the U.S. electricity market.

While 24 states and the District of Columbia have enacted legislation for retail electric industry competition, other states appear to be firmly committed to leaving their power markets as they are for the foreseeable future, according to the report.

Separately, the report raised concerns about FERC's proposed standard design for creating regional electricity markets, saying the agency has not specified how it will monitor the new power markets or how violations of its rules will be enforced.

The study did not come out and say whether FERC's proposal would be good or bad for consumers.

The report was written with advice from government officials, trade group representatives and energy company executives.

FERC chairman Pat Wood and his fellow commissioners provided advice to the panel that wrote the report, but did not say if they endorsed the study's findings and recommendations.

Wood and the other commissioners will be briefed on the report shortly and given the chance to comment, the study's authors said.

Reuters