Senator Menendez Expresses Hopes For Terms Of A Settlement In Major Electricty Wholesaler Dispute

PJM charged with obstructing its Market Monitor's work

December 18, 2007 -- WASHINGTON – At a Senate nomination hearing today for a member of the Federal Energy Regulatory Commission (FERC), Senator Bob Menendez again expressed his hopes for a strong Market Monitor with the responsibility of ensuring a competitive wholesale electricity market in New Jersey and 14 other states. Currently PJM, the non-profit in charge of regulating wholesale electricity markets in those states, and its Market Monitor are negotiating a settlement in a dispute that began when the Market Monitor alleged that the company was obstructing his work. Tomorrow is the deadline for the parties to reach a settlement before a mediator.

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Senator Menendez has taken a number of actions to ensure that FERC handles the dispute appropriately, including requesting full hearings (http://menendez.senate.gov/newsroom/record.cfm?id=278477).

Below is Senator Menendez’s remarks on the dispute, as prepared for delivery at the hearing:

“Commissioner Wellinghoff, I’d now like to discuss an issue which affects the entire PJM RTO region. Last spring, Dr. Joseph Bowring from PJM’s market monitoring unit came public with disturbing allegations that his work was being interfered with and manipulated. Under FERC’s oversight, PJM and its Market Monitoring Unit have been trying to resolve their dispute.

“It is imperative that we have fair and competitive electricity markets. Without a strong, independent market monitor, consumers cannot be confident that they are not being cheated by monopolies or manipulators. In evaluating any proposed solution, FERC should make sure that the Market Monitor has timely access to whatever information they need to determine whether prices need to be mitigated. The Market Monitor must have the staff and infrastructure needed to do their job. And, in order to preserve its independence, the Market Monitor should report to a board outside of the PJM hierarchy, a board which represents all stakeholders.

Source: Senator Bob Menendez