FERC to revise power tariffs, set refund plan

The commission also instituted a proceeding to establish a refund effective date, should it find that electric power rates are unjust and unreasonable.

FERC said it was concerned about the potential for public utilities with market-based rate authorizations to exercise market power or engage in anti-competitive behavior. The agency said it took action to ensure that rates were reasonable.

FERC said that while it did not find that particular sellers have exercised unfair market power, the agency proposed to take steps now to minimize the potential for any market abuse in the future.

"Should a public utility engage in a prohibited behavior, it's rate will be subject to increased commission scrutiny, potential refunds, and restrictions on or termination of its market-based rate authority," FERC said regarding its proposal.

The measure is also designed to prevent a repeat of California's power market disarray last winter. Wholesale prices soared to record highs amid tight supplies in California, forcing the state to step in and buy wholesale power after two big utilities lost their credit ratings.

FERC said its order also would establish a refund effective date 60 days from the day its order is published in the Federal Register. The agency would also accept public comments.

The order seeks to include in all revised market-based rate tariffs language explicitly prohibiting anti-competitive behavior, such as physical and economic withholding of supplies.