FERC settlement with Transco includes record $20 million civil fine

March 18, 2003
The Federal Energy Regulatory Commission this week approved a settlement with the Transcontinental Gas Pipe Line Corp. (Transco) that includes a $20 million civil penalty, the largest in the agency's history.

By OGJ editors

WASHINGTON, DC, Mar. 18 --The Federal Energy Regulatory Commission this week approved a settlement with the Transcontinental Gas Pipe Line Corp. (Transco), a subsidiary of Williams Cos. Inc., that includes a $20 million civil penalty, the largest in the agency's history.

The penalty will be paid in five installments over 4 years; Williams and its affiliates neither admitted nor denied they engaged in the anti-competitive behavior for which the commission accused them.

FERC investigators said the pipeline over the last 4 years gave "undue preference" to affiliates in transportation matters. FERC staff said violations included: giving Transco's marketing affiliate, Williams Energy Trading and Marketing Co., access to competitors' customer information via the pipeline's computer database; failing to provide transportation information to competitors in a timely manner; and failing to maintain proper records and files.

Under the settlement Monday, Williams agreed to terminate its firm sales merchant function.

"This settlement should make it abundantly clear that improper dealing will not be allowed to jeopardize the economic growth that comes from open and fair markets," said FERC Chairman Pat Wood. "The Commission will not tolerate this kind of anticompetitive behavior."

Wood noted that the settlement stems from a relatively rare and narrow instance in which the commission has the authority to impose civil penalties. FERC is asking Congress to give the agency more authority to impose civil penalties when companies break agency rules.

It would enhance the commission's ability to deter anticompetitive behavior in energy markets, FERC officials said.