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Authors

Antony E. Ghee

Abstract

Does the Federal Energy Regulatory Commission (“FERC”) have authority to police manipulation in financial markets if that conduct has an effect on physical markets? FERC has erroneously argued that it possesses such authority. Adopting FERC’s view would confound the regulatory landscape and promote duplicative and even conflicting regulation. FERC’s mission is clear: to ensure that the rates charged for wholesale sales of natural gas and electricity are “just and reasonable.” Its jurisdiction is limited by statute and nothing in the legislative history, prevailing case law, or public policy suggests that Congress conferred to FERC powers to police manipulation outside of its statutorily defined jurisdictional boundaries. Accordingly, FERC does not, and should not, have authority to police manipulation in financial markets even if that conduct has an effect on physical markets.

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