Posted on 06/15/2002 11:23:51 PM PDT by lewislynn
June 14, 2002, 1:24AM
NEW YORK -- Pennsylvania energy regulators, echoing similar charges in California, on Thursday said PPL Corp. had unfairly manipulated prices in the Mid-Atlantic power market early last year.
The Pennsylvania Public Utilities Commission said in a statement that a six-month investigation conducted by its legal staff determined the utility's actions "damaged wholesale and retail markets and the public's confidence in them."
"I agree with our Law Bureau's conclusion that there is reason to believe that PPL manipulated the availability and cost of mandatory installed capacity in PJM in an exercise of unlawful market power and blatant market gaming," PUC Chairman Glen R. Thomas said in a statement.
PJM is the power grid that serves some 25 million people living between New Jersey and Washington, D.C..
The commission also said it was taking its findings to the Department of Justice and the Federal Energy Regulatory Commission in Washington and the Pennsylvania attorney general for appropriate action.
Specifically, the commission alleged PPL manipulated the price of capacity in the PJM market.
Beginning in January 2001, the price of capacity abruptly rose from about $5 per megawatt hour to $177 per megawatt hour for nearly three months, the commission said.
PPL, the former Pennsylvania Power and Light based in Allentown, Pa., fired back it had done nothing wrong.
"We are convinced that all transactions in the PJM capacity market by PPL companies were legal and ethical, and in compliance with applicable laws and regulations," Paul Champagne, president of PPL EnergyPlus, said in a statement.
Champagne pointed out that PJM's market rules did not prohibit PPL EnergyPlus' actions at the time, but both PJM and the Public Utilities Commission concluded that the company unfairly used its market power.
By April 2001, when PJM changed its rules with FERC, capacity prices dropped sharply and returned to historic price patterns, the commission said.
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