DOW JONES NEWSWIRES
Constellation Energy Group Inc. (CEG) said it will pay $245
million to settle claims from the Federal Energy Regulatory
Commission related to certain energy-trading transactions in New
York wholesale energy markets.
The FERC alleged that Constellation manipulated the market by
scheduling phsyical flows among several independent system
operators to benefit the company's financial positions from
September 2007 to December 2008.
The power company will pay a $135 million civil penalty and $110
million in disgorgement. Of the disgorgement amount, $6 million
will be given to regional grid operators to improve their
surveillance and analytic capabilities, while the remaining amount
will be deposited in a fund administered by a FERC administrative
law judge.
"We believe Constellation's trading practices in question were
lawful portfolio risk management transactions," said Chief
Executive Mayo A. Shattuck III. "The company admits to no
wrongdoing in this case."
The company noted it has implemented several measures to enhance
its trading policies and practices since 2008.
Earlier Friday, FERC approved Constellation's proposed merger
with Exelon Corp. (EXC).
Last month, Constellation Energy said it swung to a
fourth-quarter loss as it reported struggles in its generation
business and increased losses at its NewEnergy retail
operations.
Constellation's shares fell by 24 cents to $35.91 after hours.
Through the close, the stock is down 8.9% so far this year.
-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287;
nathalie.tadena@dowjones.com