JPMorgan Chase & Co. (JPM:US) said accusations of market manipulation by California’s electric-grid operator are “irrelevant and unproven” as the parties spar over payments for power from 2009 to 2011.
The California Independent System Operator, which oversees the wholesale power market in the state, has said the payments were excessive and the result of bidding behavior and took the case to the U.S. Federal Energy Regulatory Commission. JPMorgan said the California operator reached conclusions before FERC completes its investigation.
The state operator “cannot muster any meaningful, substantive responses to the legal arguments” in the case, according to an Aug. 3 filing made by JPMorgan. “Therefore it resorts to irrelevant and unproven allegations” about the bidding.
FERC Chairman Jon Wellinghoff said in March that the agency will be vigorous in seeking to stop companies from manipulating electricity markets, after the agency reached a record $245 million settlement with Constellation Energy Group Inc. for trading practices in New York and New England.
JPMorgan’s role was disclosed when the agency, responding to a complaint from the state, asked a federal judge in Washington to retrieve some of JPMorgan’s e-mails as part of the investigation. JPMorgan has said it acted within the law in its bidding for California power.
FERC doesn’t have any deadline for ruling on California’s request, agency’s spokesman Craig Cano said by phone today.
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