FERC orders Civil Penalty of $450,000 and Disgorgement of $119,425.10 to be paid by Dynegy

Summary:

FERC assessed a Civil Penalty to the United States of $450,000 against Dynegy Marketing and Trade, LLC (Dynegy); disgorgement to PJM Interconnection Inc. (PJM) in the amount of $119,425.10, inclusive of interest; and annual compliance monitoring reporting for two years. On March 28, 2022, the Commission approved a Stipulation and Consent Agreement (Agreement) between FERC’s Office of Enforcement (Enforcement) and Dynegy. In the Order, the Commission found the settlement is in the public interest because the Agreement resolves on fair and equitable terms Enforcement’s investigation into whether Dynegy’s Real-Time energy market offers in Summer 2017 for ten GE 7FA (7FA) dual-fuel combustion turbines (CTs) in the PJM market misrepresented that the units could ramp to their maximum oil-based output attained during their capacity tests (ICAP) while running on gas. Staff’s investigation determined that Dynegy’s conduct violated 18 C.F.R. § 35.41(b) and Section 1.7.19 of Schedule 1 of the Amended and Restated Operating Agreement and Attachment K – Appendix of the PJM Open Access Transmission Tariff, which requires each unit to be able to change output at the ramping rate specified in the Offer Data. The Order also resolved Enforcement’s finding that Dynegy violated § 35.41(b) when it maintained a prospective 16 MW capacity increase for Armstrong, one of the three dual-fuel unit facilities, based on (a) unit upgrades that were never completed by the previous owner and (b) the use of auxiliary generators during capacity tests, which was prohibited by PJM.