Penalties the Federal Energy Regulatory Commission may assess to gas and power companies, as well as individuals, accused of violating statutes, rules and orders within its jurisdiction will increase slightly as part of the commission's annual adjustment for inflation of the maximum civil monetary penalties it can impose.
Violations of the Natural Gas Act, Natural Gas Policy Act, Part II of the Federal Power Act or of any rule or order promulgated pursuant to those acts were subject to a maximum fine of $1,291,894 per violation, per day. Accounting for inflation of 1.182% since these penalties were adjusted last year, FERC raised the maximum per violation, per day fine to $1,307,164, the commission said in a final rule issued Jan. 8.The NGPA governs gas production while the NGA tackles pipelines and the transmission and sale of gas. Part II of the FPA covers electric transmission and wholesale power sales.
The base penalty increase amount was calculated using "the percentage by which the US Department of Labor's Consumer Price Index for all-urban consumers (CPI-U) for October of [2020] exceeds the CPI-U for October of the year before that," according to the text of the rule (RM21-8).
Hydro, utility finesA failure or refusal to comply with Part I of the FPA, which governs hydroelectric dam licensing and safety, had carried a maximum $23,331 fine per violation, per day, and that was increased to $23,607.
A $3,047 maximum fine per violation imposed on public utilities and licensees who violate the FPA was boosted to $3,083 per violation.
The fine relates to any willful failure "to comply with any order of the commission; to file any report required under [the FPA] or any rule or regulation of the commission thereunder; to submit any information or document required by the commission in the course of an investigation conducted under [the FPA]; or to appear ... at any hearing or investigation in response to a subpoena issued under [the FPA]," according to 16 U.S.C.§825n (a).
Oil pipeline penaltiesThe rule also addressed civil penalties related to oil pipeline transportation rates and services laid out in the Interstate Commerce Act.
Penalties tied to the posting and filing of rate schedules went from a maximum $1,352 per offense and $68 per day after the first day to $1,368 per offense and $69 per day after the first day.
The maximum $13,525 per violation, per day fine for the knowing or neglectful failure to comply with FERC orders barring any unjust, unreasonable or discriminatory rates, charges or practices was raised to $13,685.
Penalties for violating requirements to provide information, or to provide access, in connection with the commission's valuation of a pipeline carrier's property increased to a maximum of $1,368 per offense, per day, from $1,352.
The $1,352 per offense, per day maximum penalty for oil pipelines that fail to keep or submit certain accounts, records, or memoranda required by the commission was bumped up to $1,368 as well.
A 2015 amendment to a 1990 law prompted FERC's review in 2016 of its penalty rates, some of which had not been updated since the early 1900s. The change in law now requires FERC, along with every other federal agency, to update its civil penalties each year by Jan. 15.
The rule issued Jan. 8 will take effect upon its publication in the Federal Register.
