Feds fine 5 utilities total of $22.5 million

The Federal Energy Regulatory Commission used its enforcement authority for the first time Thursday, levying $22.5 million in civil penalties on five power companies.

PacifiCorp, Scana Corp., Entergy Corp., NorthWestern Corp. and NRG Energy Inc. agreed to pay fines ranging from $500,000 to $10 million for violating agency rules.

"We've been very deliberate in the way we've approached this first use" of the penalty authority, said Commission Chairman Joseph Kelliher. "None of these settlements impose maximum penalties."

The commission was granted the power to fine companies up to $1 million a day per violation in energy legislation signed into law in August 2005. Congress granted the authority after the commission discovered violations by companies in western power markets during 2000 and 2001.

Four of the five companies reported their violations to the commission, Kelliher said. Commission "staff would've recommended higher penalties" if the violations were not self-reported, he said.

The agreements between commission staff and the companies paying the fines were approved Thursday in a unanimous vote at the commission's open meeting in Washington.

"We are now an enforcement agency capable of oversight," Kelliher said. "Our actions today show that."

PacifiCorp, a subsidiary of Warren Buffett's MidAmerican Energy Holdings Co. and parent company of Rocky Mountain Power, faces the largest fine, $10 million, and it also agreed to pay $884,000 to certain transmission customers. Staff found 329 violations by PacifiCorp of rules governing how the utility lets customers and its own subsidiaries use its power lines.

"We regret these violations, promptly reported the results of our internal audit to FERC and cooperated fully with FERC staff," Pat Reiten, president of PacifiCorp's Pacific Power operating division, said in a statement.

Kelliher said PacifiCorp "reflected different compliance culture" after it was purchased by MidAmerican from U.K. utility Scottish Power Plc last March.