FERC Seeks Public Comment on Penalty Guidelines



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On April 15, 2010, the Federal Energy Regulatory Commission (FERC) announced that it will suspend and open to public comment the Policy Statement on Penalty Guidelines (Policy Statement), which FERC issued on March 18, 2010 in Docket No. PL10-4-000. In suspending the Policy Statement, FERC determined that the public interest would be best served by affording the public an opportunity to comment on the penalty guidelines before putting them into effect. After assessing the public comments received, FERC will determine whether or not to amend the Policy Statement before its adoption.

FERC initially adopted the Policy Statement on March 18, 2010 after nearly four years of experience with new and expanded civil penalty authority under the Energy Policy Act of 2005 (EPAct 2005). EPAct 2005 expanded FERC's civil penalty authority under the Federal Power Act (FPA) and, for the first time, provided civil penalty authority to cover violations of the Natural Gas Act (NGA). The statute also raised the maximum civil penalty to $1 million per day, per violation, for any violation of the Natural Gas Policy Act, the NGA or Part II of the FPA.
Guidelines in the Policy Statement are modeled on portions of the United States Sentencing Guidelines, with appropriate modifications to account for FERC-specific issues. Although the penalty guidelines represent a change in how FERC will determine civil penalties, the guidelines will continue to use many of the factors previously considered, such as the seriousness and remediation of a violation. The guidelines reflect the requirements of EPAct 2005 and are the centerpiece of FERC?s penalty regime.

Parties interested in filing comments to the Policy Statement must do so by June 14, 2010.


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