FERC's Authority to Impose Monetary Remedies for Federal Power Act and Natural Gas Act Violations: An Analysis

Administrative Law Review, The American Bar Association, Vol. 57 Issue 2

May 2005

By Brian M. Zimmet

The Federal Energy Regulatory Commission (FERC or the Commission) finds itself today exercising a role that is quite different from the one envisioned by Congress when the Commission was first established. Its predecessor, the Federal Power Commission (FPC), was established in the 1920s to license hydroelectric projects, and later given substantial authority under the Federal Power Act (FPA) and Natural Gas Act (NGA) to regulate rates, a role that it continues to play today. Since the late 1980s, however, FERC has assumed the role of a market overseer, trying to advance competitive markets rather than examining costs of individual regulated entities as the principal means of ensuring that rates for jurisdictional service remain just and reasonable. Because the promotion of competitive markets has received only piecemeal attention and approval from Congress, particularly with respect to the regulation of electricity markets, the Commission has had to rely substantially on its original statutory authority to effect its desired changes. In many ways, that original statutory authority is an awkward fit with the Commission’s increasing reliance on competitive markets to regulate rates.

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