U.S. regulator orders GreenHat Energy to pay $242 mln fine

A security guard walks past a montage of old U.S. dollar bills outside a currency exchange in Kenya's capital Nairobi July 23, 2015. REUTERS/Thomas Mukoya/File Photo

May 20 (Reuters) - The U.S. energy regulator on Thursday ordered GreenHat Energy LLC to pay $229 million in civil penalties and $13.1 million in unjust profits on allegations of electric market manipulation.

The U.S. Federal Energy Regulatory Commission (FERC) enforcement staff's report raises serious allegations about market manipulation that cost consumers in the PJM market nearly $180 million, Chairman Richard Glick said in a press release.

The agency alleges that GreenHat Energy sent false price signals into the PJM market, the largest in the country, by purchasing Financial Transmission Rights (FTR) based on minimal collateral, deliberately made false statements to PJM to try to avoid a collateral call and rigged FTR auctions.

GreenHat has 30 days to respond to the FERC's order, as per the release.

PJM operates the grid in all or parts of 13 Midwest and mid-Atlantic states and the District of Columbia from Illinois to New Jersey and as far south as North Carolina.

Reporting by Nakul Iyer in Bengaluru Editing by Marguerita Choy

Our Standards: The Thomson Reuters Trust Principles.