Connecticut Attorney General's Office

Press Release

Attorney General, OCC Announce FERC Has Granted Request For Investigative Hearing Of Power Market

August 25, 2009

Attorney General Richard Blumenthal today announced that the Federal Energy Regulatory Commission (FERC) has granted his request and that of the Office of the Consumer Counsel (OCC) to hold an investigative hearing into whether power plants manipulated the energy market by bidding to provide power that they had no intention of delivering.

Blumenthal -- joined by Consumer Counsel Mary J. Healey and the Department of Public Utility Control -- requested an investigative hearing after learning that electricity consumers, through ISO-New England, paid more than $50 million to power generators who delivered no power.

Blumenthal said, "This investigative hearing will deliver a stunning jolt of transparency and truth to the public about gross manipulation of our power markets that has cost consumers at least more than $50 million. My office aggressively fought for this investigative hearing after discovering that ISO-New England paid millions to generators for nothing in return.

"Power generators were paid on a promise to deliver -- but had no ability or intent to provide that power. Electric consumers deserve facts and accountability for this apparent scam that richly rewards generators for providing power that they have no intention of delivering."

Healey said, "I am pleased that FERC has authorized a trial-type evidentiary hearing as to our complaint of market manipulation. It is only through a full discovery process and cross-examination of the power generating companies involved and of ISO New England that we will get to the truth of this matter. This is a case of significant magnitude, involving about $51 million from ratepayers. We are glad that FERC has recognized that it must let the public representatives examine and ask about all the relevant data, with answers provided under oath."

Blumenthal's office is also separately continuing an investigation related to these payments and other possible anticompetitive practices that may drive up costs and drive out competition in the electricity market.