PRIVILEGED & CONFIDENTIAL ATTORNEY WORK PRODUCT SUBJECT TO 18 C.F.R. § 1b.9 NON-PUBLIC INVESTIGATION
November 6, 2023
TO:
Margaret Hollowell, Director Division of Investigations, Office of Enforcement Federal Energy Regulatory Commission 888 First Street NE Washington, D.C. 20426
Christine Pham, Senior Attorney Division of Investigations, Office of Enforcement Federal Energy Regulatory Commission 888 First Street NE Washington, D.C. 20426
FROM:
Catherine Bloom, Partner Calderwood & Harkness LLP 1001 Fannin Street, Suite 4200 Houston, TX 77002 Telephone: (713) 555-8400
Email: cbloom@calderwoodharkness.com
RE:
Docket No. IN23-7-000 — Exhibit Book Accompanying Response to Preliminary Findings of Dunmore Energy Holdings Ltd. and Dunmore Power Trading LLC
C&H Matter No.: 1016-00004
COVER MEMORANDUM
I. Introduction
This cover memorandum and the accompanying exhibit index are submitted on behalf of Dunmore Energy Holdings Ltd. ("DEH") and Dunmore Power Trading LLC ("DPT") (collectively, "Respondents") in connection with the Response to FERC Staff Preliminary Findings ("Response") filed simultaneously on this date, November 6, 2023, in the above-captioned matter. The exhibits described herein constitute the evidentiary record that Respondents respectfully submit for the Commission Staff's consideration in evaluating the defenses and mitigating arguments set forth in the Response.
As the Commission Staff is aware, this proceeding arises from FERC Staff's Preliminary Findings letter dated October 2, 2023 (the "Preliminary Findings"), in which Staff set forth allegations that Respondents engaged in market manipulation in violation of Section 222 of the Federal Power Act, 16 U.S.C. § 824v, and the Commission's Anti-Manipulation Rule, 18 C.F.R. § 1c.2, in the Midcontinent Independent System Operator, Inc. ("MISO") Day-Ahead and Real-Time energy markets at the Indiana Hub and Minnesota Hub pricing nodes during the period from January 3, 2022 through March 17, 2023 (the "Relevant Period"). Staff's Preliminary Findings allege, inter alia, that DPT submitted uneconomic negative Day-Ahead generation offers at the Indiana Hub to create or exacerbate congestion, thereby enhancing the value of Financial Transmission Rights ("FTRs") held by DPT, and that DPT coordinated virtual trading positions at the Minnesota Hub to amplify the financial benefit of the alleged scheme. Staff further alleges that DPT's affiliate, Dunmore Midstream Partners LP ("DMP"), coordinated gas nomination scheduling in furtherance of the alleged manipulative strategy. Staff's Preliminary Findings estimate unjust profits of approximately $12.8 million.
Respondents vigorously dispute the Preliminary Findings and maintain that DPT's trading activity during the Relevant Period was conducted for legitimate business purposes, consistent with established industry practices, and within the bounds of applicable market rules. The exhibits assembled in this Exhibit Book are intended to support Respondents' defenses and mitigating arguments as fully articulated in the Response, and to provide Staff with the documentary and expert analytical foundation for Respondents' position that no market manipulation occurred.
II. Organization of Exhibits
The exhibits contained in this Exhibit Book are grouped into seven topical categories, each corresponding to a principal section of the Response. This organizational structure is designed to facilitate Staff's review of the evidentiary record in parallel with the arguments presented in the Response. The seven categories are as follows:
Category A: Expert Economic Analysis. Exhibits A-1 through A-4 present the expert economic analysis prepared by Dr. Leonard Whitfield of Whitfield Economic Advisors LLC, which rebuts FERC Staff's market impact assessment and unjust profits calculations. Dr. Whitfield's analysis demonstrates that the congestion patterns at the Indiana Hub during the Relevant Period were predominantly caused by transmission outage events rather than DPT's bidding activity, and that DPT's actual market impact was limited to no more than $2.1 million — a fraction of Staff's $12.8 million estimate.
Category B: Day-Ahead Bidding and Portfolio Optimization. Exhibits B-1 through B-5 address the substance of DPT's Day-Ahead generation offers at the Indiana Hub and support Respondents' legitimate business purpose defense. These exhibits include the underlying offer data, internal strategy documentation predating the Relevant Period, contractual minimum generation obligations requiring dispatch of certain gas-fired units, marginal cost calculations, and a comparative analysis demonstrating that DPT's bidding behavior was not anomalous within the broader MISO market.
Category C: Financial Transmission Rights. Exhibits C-1 through C-3 address DPT's FTR positions and demonstrate that these positions were acquired as part of routine hedging activity through MISO's FTR auction processes, were governed by pre-existing risk management policies, and were consistent with DPT's historical FTR acquisition and management practices in the three years preceding the Relevant Period.
Category D: Physical-Financial Coordination / Gas Nominations. Exhibits D-1 through D-4 address Staff's allegations regarding the coordination of gas nominations through Dunmore Midstream Partners LP. These exhibits demonstrate the functional separation between DPT's trading operations and DMP's midstream operations, present the gas nomination and scheduling data for the Relevant Period, and document that communications between DPT trading personnel and DMP operations staff were limited to routine operational coordination regarding gas delivery scheduling.
Category E: Virtual Trading Activity. Exhibits E-1 through E-3 address DPT's virtual trading positions — Increment Offers and Decrement Bids — at the Minnesota Hub during the Relevant Period. These exhibits demonstrate that virtual positions reflected independent market views on Day-Ahead/Real-Time price convergence and were not systematically correlated with Day-Ahead bidding at Indiana Hub in a manner suggesting coordination for manipulative purposes.
Category F: Compliance Program and Remedial Measures. Exhibits F-1 through F-5 present Respondents' compliance infrastructure, including pre-existing compliance policies and training records, the proactive appointment of a Chief Compliance Officer before the commencement of the FERC investigation, and the comprehensive enhanced compliance program being developed by Ridgeway Compliance Solutions LLC. These exhibits demonstrate Respondents' good faith and commitment to regulatory compliance.
Category G: Cooperation with Investigation. Exhibits G-1 through G-4 document Respondents' full and timely cooperation with the Office of Enforcement's investigation from May 2023 through the present, including the production of approximately 187,000 documents (approximately 1.24 million pages), the voluntary provision of employee testimony, and the complete and timely response to all data requests.
III. Source and Provenance of Exhibits
All exhibits contained in this Exhibit Book are drawn from one of two sources. The majority of exhibits consist of documents previously produced by Respondents in the course of this investigation, as referenced by Bates stamp numbers in the DUNMORE-XXXXXX series. These documents were collected, processed, and produced in accordance with the specifications agreed upon between Calderwood & Harkness LLP and the Division of Investigations, and were managed by Respondents' e-discovery vendor, Crestline Document Solutions LLC, located at 1400 Smith Street, Suite 2100, Houston, TX 77002.
The remaining exhibits have been prepared specifically for this Response and are labeled with the prefix "RES-EX-" followed by the applicable exhibit number. These newly prepared exhibits include, among other things, Dr. Whitfield's expert report and supporting analyses, the cooperation summary, and the enhanced compliance plan summary.
The total exhibit record comprises thirty-four (34) individual documents or document sets across the seven categories described above.
IV. Confidential Treatment
Respondents respectfully note that certain exhibits contained in this Exhibit Book — particularly the trading data and strategy documentation in Categories B, C, D, and E — contain commercially sensitive and proprietary trading data, the public disclosure of which would cause competitive harm to Respondents. This information has been produced and is submitted in this proceeding subject to the protective provisions of 18 C.F.R. § 1b.9, which govern the non-public nature of Commission investigations. Respondents respectfully request that all exhibits in this Exhibit Book continue to receive non-public treatment in accordance with the Commission's regulations and the protective provisions applicable to this investigation.
In the event that any portion of the Response or the accompanying Exhibit Book is made public or filed in connection with any public proceeding, Respondents request the opportunity to designate specific materials for confidential treatment and to submit appropriately redacted public versions in accordance with 18 C.F.R. § 388.112.
V. Production Format
All exhibits drawn from prior document productions retain their original Bates stamp designations in the DUNMORE-XXXXXX series. New exhibits prepared for this Response are labeled sequentially within each category using the "RES-EX-" prefix. Production formatting, including Bates stamping and load file preparation for newly produced materials, was performed by Crestline Document Solutions LLC in accordance with the production specifications previously agreed upon in this investigation.
Exhibits are presented in the order set forth in the Exhibit Index that follows this cover memorandum. Where an exhibit consists of a multi-document set (e.g., a collection of related trading records or correspondence), the documents within the set are organized chronologically unless otherwise noted.
EXHIBIT INDEX
CATEGORY A: EXPERT ECONOMIC ANALYSIS
Exhibit A-1. Title: Expert Report of Dr. Leonard Whitfield — Economic Analysis of DPT's MISO Trading Activity During the Relevant Period (Preliminary Draft)
Designation: RES-EX-A1
Date: November 3, 2023 (preliminary draft)
Author: Dr. Leonard Whitfield, Ph.D., Principal, Whitfield Economic Advisors LLC, 1700 Pennsylvania Avenue NW, Suite 550, Washington, D.C. 20006
Description: This exhibit contains Dr. Whitfield's comprehensive economic analysis of DPT's trading activity in the MISO Day-Ahead and Real-Time energy markets at the Indiana Hub and Minnesota Hub pricing nodes during the Relevant Period of January 3, 2022 through March 17, 2023. The report constitutes a detailed rebuttal of FERC Staff's Preliminary Findings and, in particular, Staff's estimate that DPT obtained unjust profits of approximately $12.8 million through the alleged manipulative scheme.
Dr. Whitfield's independent economic analysis reaches the following principal conclusions:
(1) The congestion patterns observed at the Indiana Hub during the Relevant Period were primarily driven by significant planned and unplanned transmission outage events in the MISO Indiana Hub region, not by DPT's Day-Ahead generation offers. Dr. Whitfield's econometric analysis demonstrates that transmission outages account for the vast majority of the observed congestion differential, and that DPT's bidding activity had a comparatively limited marginal impact on congestion outcomes.
(2) DPT's negative Day-Ahead generation offers (ranging from -$15/MWh to -$40/MWh) were consistent with portfolio-level optimization strategies employed by DPT and other similarly situated MISO market participants with generation portfolios subject to contractual minimum generation obligations. When evaluated in the context of portfolio-level economics — including the value of maintaining dispatch to fulfill contractual commitments, avoiding start-up costs, and capturing Real-Time price upside — these offers reflect rational economic behavior, not manipulative conduct.
(3) DPT's FTR positions were acquired through MISO's annual and monthly FTR auctions months before the commencement of the Relevant Period, consistent with routine hedging activity. The profitability of these positions during the Relevant Period was attributable to market conditions — principally transmission outages — rather than to any manipulative scheme by DPT.
(4) Dr. Whitfield's independent calculation of DPT's actual incremental market impact — i.e., the marginal increase in congestion attributable to DPT's bidding activity as opposed to exogenous factors — estimates that impact at no more than $2.1 million, substantially below Staff's $12.8 million estimate. Dr. Whitfield's analysis identifies significant methodological shortcomings in Staff's calculation, including the failure to account for the independent effects of transmission outages and the use of an overly broad attribution methodology.
Note: This exhibit contains the preliminary draft of Dr. Whitfield's expert report as of November 3, 2023. Respondents intend to submit the final version of the expert report, incorporating any additional data analysis and refinements, on or about November 20, 2023, and reserve the right to supplement the exhibit record at that time.
Expert Credentials: Dr. Leonard Whitfield holds a Ph.D. in Economics from the Massachusetts Institute of Technology, with a specialization in energy market design and wholesale electricity market analysis. He is the founder and Principal of Whitfield Economic Advisors LLC, a consulting firm specializing in energy market economics, regulatory analysis, and expert testimony in FERC and state regulatory proceedings. Dr. Whitfield has been retained as an expert economist in more than forty proceedings before the Commission and various state public utility commissions over the past eighteen years.
Retention and Compensation: Dr. Whitfield was retained by Calderwood & Harkness LLP on behalf of Respondents on July 10, 2023. His current hourly rate is $475 per hour.
Exhibit A-2. Title: Curriculum Vitae of Dr. Leonard Whitfield
Designation: RES-EX-A2
Description: This exhibit contains the current curriculum vitae of Dr. Leonard Whitfield, setting forth his professional background, educational credentials, academic and professional publications, prior expert engagements in proceedings before the Federal Energy Regulatory Commission and state regulatory commissions, and other relevant qualifications. Dr. Whitfield's curriculum vitae reflects extensive experience in wholesale electricity market analysis, market manipulation investigations, congestion management, and the economic analysis of virtual trading and FTR activity. His prior expert engagements include testimony in FERC enforcement proceedings, market-based rate authorization proceedings, and contested rate cases before the public utility commissions of Illinois, Indiana, Michigan, Ohio, and Texas, among others.
Exhibit A-3. Title: Transmission Outage Data — MISO Indiana Hub Region (January 2022 – March 2023)
Designation: RES-EX-A3
Source: MISO Open Access Same-Time Information System (OASIS)
Description: This exhibit compiles publicly available transmission outage records for the MISO Indiana Hub region during the Relevant Period. The data includes both planned and unplanned transmission outages on the high-voltage transmission facilities that affect congestion at the Indiana Hub pricing node. The compilation documents a total of forty-seven (47) discrete transmission outage events during the Relevant Period, including twelve (12) forced outage events on the 345-kV transmission system and eight (8) planned outage events involving extended maintenance windows.
This data forms a central component of Dr. Whitfield's analysis and supports his conclusion that the congestion patterns FERC Staff attributes to DPT's bidding were in fact driven by exogenous transmission system conditions that would have produced similar congestion outcomes regardless of DPT's market participation. The data demonstrates, among other things, that the periods of most intense congestion at the Indiana Hub during the Relevant Period coincided with major transmission outage events, including forced outages on the Rockport-Sullivan and the Breed-Cayuga 345-kV lines, which significantly reduced transfer capability into the Indiana Hub area.
Exhibit A-4. Title: Statistical Analysis — Congestion Attribution Model
Designation: RES-EX-A4
Author: Dr. Leonard Whitfield, Whitfield Economic Advisors LLC
Description: This exhibit presents Dr. Whitfield's econometric model isolating the contribution of transmission outage events versus DPT's Day-Ahead bidding activity to observed congestion at the Indiana Hub during the Relevant Period. The model employs a multivariate regression framework incorporating transmission outage data (Exhibit A-3), DPT's Day-Ahead offer data (Exhibit B-1), aggregate market offer data for other market participants at the Indiana Hub, load and weather data, and natural gas price data.
The model's principal finding is that transmission outage events explain approximately 87% of the variance in Indiana Hub congestion during the Relevant Period, while DPT's bidding activity — after controlling for transmission outages and other market variables — explains no more than 6% of the observed congestion differential. Based on this attribution analysis, Dr. Whitfield concludes that DPT's actual incremental market impact is limited to no more than $2.1 million, as compared to Staff's estimate of $12.8 million. The exhibit includes a detailed description of the model specification, data sources, regression output, diagnostic tests, and sensitivity analyses.
CATEGORY B: DAY-AHEAD BIDDING AND PORTFOLIO OPTIMIZATION
Exhibit B-1. Title: DPT Day-Ahead Offer Data — Indiana Hub (January 3, 2022 – March 17, 2023)
Designation: RES-EX-B1
Bates References: Summary compiled from DUNMORE-012440 through DUNMORE-018793 (underlying trading records)
Description: This exhibit consists of a summary spreadsheet of DPT's Day-Ahead generation offers submitted at the Indiana Hub during the Relevant Period. The spreadsheet is organized by date, hour, generation unit, offer price, and offer quantity, and identifies the approximately 2,840 GWh of Day-Ahead offers that FERC Staff characterizes as uneconomic. Offer prices for these units ranged from -$15/MWh to -$40/MWh, as identified in Staff's Preliminary Findings.
The summary spreadsheet was prepared by Calderwood & Harkness LLP from the underlying trading records previously produced in this investigation at the Bates ranges identified above. The exhibit is intended to provide Staff with a consolidated reference for DPT's Day-Ahead offer activity and to facilitate cross-referencing with the expert analysis in Category A and the portfolio optimization documentation in the remaining Category B exhibits.
Exhibit B-2. Title: DPT Portfolio Optimization Strategy Documentation
Designation: Previously produced
Bates References: DUNMORE-024150 through DUNMORE-024287; DUNMORE-031402 through DUNMORE-031456
Description: This exhibit consists of internal DPT memoranda and strategy documents describing the portfolio optimization approach employed by DPT's power marketing and trading group for gas-fired generation units in the MISO market. These documents articulate the economic rationale for submitting negative Day-Ahead generation offers under certain market conditions, including the following considerations:
(a) Negative offers reflected the opportunity cost of maintaining generation dispatch, taking into account the portfolio-level value of Real-Time price exposure, ancillary services revenue, and the avoidance of unit start-up and shut-down costs associated with cycling gas-fired units.
(b) DPT's gas-fired units at the Indiana Hub were subject to contractual minimum generation obligations under power purchase agreements and interconnection agreements (as further documented in Exhibit B-3), which required minimum levels of output. Negative offers were necessary in certain hours to ensure that these units would be dispatched by MISO and that DPT would remain in compliance with its contractual commitments.
(c) The portfolio optimization approach evaluated offer pricing on a portfolio-wide basis rather than on a unit-by-unit marginal cost basis, reflecting the integrated nature of DPT's generation, trading, and hedging activities.
Critically, the strategy documents identified in this exhibit predate the Relevant Period. The earliest document in this collection — an internal strategy memorandum authored by Derek Sung, SVP Power Marketing & Trading — is dated September 14, 2021, demonstrating that the portfolio optimization approach was not created for the purpose of manipulation during the Relevant Period but was instead a pre-existing, consistently applied business strategy.
Exhibit B-3. Title: Contractual Minimum Generation Obligations
Designation: Previously produced
Bates References: DUNMORE-041200 through DUNMORE-041578; DUNMORE-043690 through DUNMORE-043812
Description: This exhibit consists of excerpted provisions from power purchase agreements ("PPAs") and interconnection agreements applicable to certain DPT gas-fired generation units located in the Indiana Hub region. The excerpted provisions establish contractual minimum generation output requirements, including must-run obligations during specified seasonal periods and minimum operating level requirements tied to interconnection service conditions.
These contractual obligations independently required DPT to maintain dispatch of certain generating units during portions of the Relevant Period, irrespective of prevailing Day-Ahead market clearing prices. As a result, negative Day-Ahead offers were a necessary and commercially reasonable tool for ensuring that MISO would dispatch these units at levels sufficient to satisfy DPT's contractual commitments. The existence of these binding contractual obligations undermines Staff's premise that DPT's negative offers lacked a legitimate business purpose and were submitted solely to create congestion for the benefit of DPT's FTR positions.
Exhibit B-4. Title: DPT Marginal Cost Calculations and Fuel Cost Data
Designation: Previously produced
Bates References: DUNMORE-055320 through DUNMORE-055894
Description: This exhibit presents internal DPT calculations of the marginal cost of generation for DPT's gas-fired units at the Indiana Hub during the Relevant Period. The marginal cost calculations incorporate the following cost components: natural gas fuel costs (based on daily and monthly index prices at the Chicago Citygate and Midcontinent delivery points), variable operations and maintenance costs, unit start-up costs (including both hot-start and cold-start costs), emissions costs, and other variable costs.
This exhibit provides context for the relationship between DPT's Day-Ahead offer prices and the economics of DPT's generation portfolio. While Staff's Preliminary Findings characterize the negative offers as "uneconomic" based on a comparison to unit-level marginal cost, this exhibit — in conjunction with the portfolio optimization documentation in Exhibit B-2 — demonstrates that offer pricing decisions were made on a portfolio-level basis that incorporated revenues and costs beyond the marginal cost of any individual unit. When evaluated in the context of portfolio-level economics, the offer prices at issue were consistent with rational, profit-maximizing behavior.
Exhibit B-5. Title: Comparable Industry Bidding Practices — Negative Day-Ahead Offer Pricing by MISO Market Participants
Designation: RES-EX-B5
Author: Dr. Leonard Whitfield, Whitfield Economic Advisors LLC
Description: This exhibit presents Dr. Whitfield's analysis of negative Day-Ahead generation offer pricing by other MISO market participants at the Indiana Hub and at comparable pricing nodes during the Relevant Period. Drawing on publicly available MISO market data and aggregated offer statistics, Dr. Whitfield identifies multiple market participants — including at least seven entities with generation portfolios comparable in size and composition to DPT's Indiana Hub portfolio — that submitted negative Day-Ahead offers in a similar price range (-$10/MWh to -$50/MWh) during the same period.
This analysis demonstrates that DPT's bidding behavior was not anomalous, idiosyncratic, or otherwise indicative of manipulative intent when viewed in the context of broader market practices. Negative offer pricing is a recognized and widely employed strategy among MISO market participants with generation portfolios subject to minimum generation obligations, portfolio-level optimization considerations, and start-up cost avoidance incentives.
CATEGORY C: FINANCIAL TRANSMISSION RIGHTS
Exhibit C-1. Title: DPT FTR Acquisition Records
Designation: Previously produced
Bates References: DUNMORE-068400 through DUNMORE-071256
Description: This exhibit consists of documentation of DPT's acquisition of Financial Transmission Rights ("FTR") positions through MISO's annual and monthly FTR auction processes. The documentation includes DPT's FTR bid submissions, auction clearing results, and position confirmations for FTR paths relevant to the Indiana Hub during the Relevant Period.
Staff's Preliminary Findings identify the notional value of DPT's relevant FTR positions at approximately $47.3 million. This exhibit demonstrates that the FTR positions at issue were acquired through MISO's standard, transparent FTR auction processes, and — critically — that the annual FTR positions were acquired in the MISO Annual FTR Auction conducted in the fall of 2021, months before the commencement of the Relevant Period on January 3, 2022. Monthly FTR positions were similarly acquired through MISO's monthly FTR auctions in the ordinary course of DPT's hedging and risk management activities.
The temporal sequence of DPT's FTR acquisition — well in advance of the Relevant Period — is significant because it undermines Staff's theory that DPT acquired FTR positions as part of a manipulative scheme involving the subsequent submission of uneconomic Day-Ahead offers. DPT's FTR positions were part of a routine hedging strategy designed to manage congestion risk associated with DPT's physical generation portfolio at the Indiana Hub.
Exhibit C-2. Title: DPT FTR Portfolio Management Policies
Designation: Previously produced
Bates References: DUNMORE-074200 through DUNMORE-074389
Description: This exhibit consists of DPT's internal policies and procedures governing the acquisition, management, and risk oversight of FTR positions. These policies were approved by Derek Sung, SVP Power Marketing & Trading, and established the framework within which DPT's FTR trading activity was conducted. Key policy elements include:
(a) FTR position limits, including maximum notional value limits by FTR path and aggregate portfolio limits;
(b) Approved FTR paths and pricing nodes, tied to DPT's physical generation and load-serving positions;
(c) Mark-to-market and value-at-risk reporting requirements for FTR positions;
(d) Approval authorities for FTR auction bidding, including requirements for pre-auction review by the Risk Management group; and
(e) Periodic reporting of FTR portfolio performance to DPT senior management and the DEH Board of Directors.
The existence of these pre-established policies demonstrates that DPT's FTR activity was subject to a structured governance framework and was not conducted on an ad hoc or opportunistic basis. The policies were in effect prior to and throughout the Relevant Period.
Exhibit C-3. Title: Historical DPT FTR Activity (2019–2021)
Designation: RES-EX-C3
Source: Compiled from DUNMORE-074390 through DUNMORE-075120 (prior productions) and supplemental data provided by DPT
Description: This exhibit presents a summary of DPT's FTR acquisition and holding patterns over the three-year period preceding the Relevant Period — calendar years 2019, 2020, and 2021. The summary includes annual and monthly FTR positions by path, notional value, and clearing prices, and demonstrates the consistency of DPT's FTR strategy over time.
This historical record establishes that the FTR positions held by DPT during the Relevant Period were not a departure from established practice, but rather a continuation of a multi-year hedging strategy that DPT had pursued consistently in connection with its physical generation portfolio at the Indiana Hub. The notional value and directional composition of DPT's FTR positions during the Relevant Period were within the range of DPT's historical FTR activity, further undermining Staff's suggestion that the positions were acquired for manipulative purposes.
CATEGORY D: PHYSICAL-FINANCIAL COORDINATION / GAS NOMINATIONS
Exhibit D-1. Title: Gas Nomination Schedules — Dunmore Midstream Partners LP (January 2022 – March 2023)
Designation: Previously produced
Bates References: DUNMORE-089300 through DUNMORE-094217
Description: This exhibit consists of a summary of gas nomination and scheduling data for natural gas deliveries through Dunmore Midstream Partners LP ("DMP") to DPT's gas-fired generation facilities during the Relevant Period. The data includes daily nomination volumes, nomination cycle timing (Timely, Evening, Intraday 1, Intraday 2, and Intraday 3 cycles), receipt and delivery points, and scheduling confirmations with interconnecting pipelines.
This exhibit is responsive to Staff's allegation that DPT coordinated gas nominations through its affiliate DMP to support the submission of uneconomic generation offers and to mask DPT's true marginal generation costs. The data demonstrates that DMP's gas nomination patterns during the Relevant Period were consistent with operational requirements driven by DPT's generation dispatch schedules as determined by MISO, and that nominations followed standard NAESB (North American Energy Standards Board) nomination cycle procedures and timelines.
Exhibit D-2. Title: DMP Standard Gas Scheduling Procedures
Designation: Previously produced
Bates References: DUNMORE-096500 through DUNMORE-096678
Description: This exhibit consists of DMP's internal operational procedures for gas gathering, processing, and pipeline scheduling. The procedures establish the standard operational protocols followed by DMP's scheduling and nominations personnel, including procedures for coordinating with DPT's generation dispatch group to ensure timely gas delivery to DPT's gas-fired facilities.
These procedures demonstrate that DMP's gas nominations were driven by operational and logistical requirements — including the need to balance pipeline pressures, manage gathering system throughput, and comply with pipeline tariff scheduling deadlines — rather than by DPT's trading strategy. The procedures were developed and implemented as part of DMP's standard midstream operations and were not designed to facilitate or support any particular trading approach by DPT.
Exhibit D-3. Title: Corporate Organizational Chart — DEH / DPT / DMP
Designation: RES-EX-D3
Description: This exhibit presents the corporate organizational chart of Dunmore Energy Holdings Ltd. and its relevant subsidiaries and affiliates, including:
• Dunmore Energy Holdings Ltd. ("DEH"): Cayman Islands exempted company; parent holding company.
• Dunmore Power Trading LLC ("DPT"): Delaware limited liability company; wholly owned subsidiary of DEH; engages in wholesale power marketing and trading, including Day-Ahead and Real-Time market participation, FTR acquisition and management, and virtual trading in MISO.
• Dunmore Midstream Partners LP ("DMP"): Delaware limited partnership; midstream natural gas gathering, processing, and pipeline operations; provides gas delivery services to DPT's generation facilities, among other customers.
The organizational chart identifies the following key personnel:
• Gavin Harcourt — Chairman & Chief Executive Officer, DEH
• Elena Mirova — President & Chief Operating Officer, DEH
• Derek Sung — Senior Vice President, Power Marketing & Trading, DPT
• Rhonda Vasquez — Vice President, Regulatory Affairs, DEH
• Jennifer Caulfield — Chief Compliance Officer, DEH (appointed February 6, 2023)
• Kyle Renfro — Trader, MISO Day-Ahead Desk, DPT
• Anastasia Petrov — Trader, MISO Real-Time Desk, DPT
The organizational chart demonstrates the functional separation between DPT's trading operations and DMP's midstream operations. While both entities are ultimately controlled by DEH, the chart illustrates that they operate through separate management structures, separate personnel, and separate operational functions. This functional separation is relevant to Staff's allegation of coordinated activity between the trading and midstream operations, and supports Respondents' position that the limited communications between DPT and DMP personnel were confined to routine operational coordination.
Exhibit D-4. Title: Communications Log — DPT Trading Desk and DMP Operations
Designation: RES-EX-D4
Source: Compiled from DUNMORE-101400 through DUNMORE-103290 (emails, instant messages, and recorded telephone calls previously produced)
Description: This exhibit presents a summary log of communications between DPT trading personnel — specifically Kyle Renfro (Trader, MISO Day-Ahead Desk) and Anastasia Petrov (Trader, MISO Real-Time Desk) — and DMP operations staff during the Relevant Period. The log catalogues each identified communication by date, time, participants, communication channel (email, instant message, or telephone), and a brief description of subject matter.
The communications log demonstrates that the contacts between DPT trading personnel and DMP operations staff were limited to routine operational coordination regarding gas delivery scheduling, including nomination volume confirmations, delivery point scheduling, and operational notices regarding pipeline maintenance or capacity constraints. The log does not reveal any communications in which DPT trading personnel directed, instructed, or requested DMP operations staff to adjust gas nominations for the purpose of supporting DPT's trading positions or influencing market outcomes.
CATEGORY E: VIRTUAL TRADING ACTIVITY
Exhibit E-1. Title: DPT Virtual Transaction Records — Minnesota Hub (January 2022 – March 2023)
Designation: RES-EX-E1
Bates References: Summary compiled from DUNMORE-112400 through DUNMORE-119870 (underlying transaction records)
Description: This exhibit consists of a summary of DPT's virtual trading transactions — Increment Offers ("INCs") and Decrement Bids ("DECs") — submitted at the Minnesota Hub pricing node during the Relevant Period. The summary is organized by date, hour, transaction type (INC or DEC), volume, and price, and encompasses the approximately 1,620 GWh of virtual transactions identified in Staff's Preliminary Findings.
The exhibit is compiled from the underlying virtual transaction records previously produced in this investigation at the Bates ranges identified above and is intended to provide Staff with a consolidated reference for DPT's Minnesota Hub virtual trading activity during the Relevant Period.
Exhibit E-2. Title: DPT Virtual Trading Strategy Documentation
Designation: Previously produced
Bates References: DUNMORE-125600 through DUNMORE-125834
Description: This exhibit consists of internal DPT strategy memoranda and analysis documents describing the rationale for DPT's virtual trading positions at the Minnesota Hub. These documents articulate DPT's market view regarding Day-Ahead/Real-Time price convergence dynamics at the Minnesota Hub, which DPT identified as a pricing node subject to systematic Day-Ahead price premiums driven by load forecast uncertainty and intermittent wind generation variability in the MISO West region.
The strategy documentation demonstrates that DPT's virtual trading positions at the Minnesota Hub reflected independent, fundamentals-based market views on price convergence opportunities — a legitimate and well-recognized function of virtual trading in organized wholesale electricity markets. The positions were not submitted as part of a scheme to amplify congestion purportedly created by DPT's Day-Ahead bidding at the Indiana Hub. Indeed, the strategy memoranda make no reference to Indiana Hub congestion, FTR positions, or any coordination between virtual trading at the Minnesota Hub and physical generation bidding at the Indiana Hub.
Exhibit E-3. Title: Anastasia Petrov Trading Activity Analysis
Designation: RES-EX-E3
Description: This exhibit presents an analysis of the virtual trading positions submitted by Anastasia Petrov, Trader on DPT's MISO Real-Time Desk, at the Minnesota Hub during the Relevant Period. Staff's Preliminary Findings specifically identify Ms. Petrov's trading activity as evidence of coordinated manipulation between DPT's Day-Ahead and Real-Time trading desks. This analysis addresses that allegation.
The analysis demonstrates the following:
(1) Ms. Petrov's virtual trading positions at the Minnesota Hub were consistent with DPT's established virtual trading strategy, as documented in Exhibit E-2, and were authorized under the trading desk's applicable position limits and risk parameters.
(2) The timing and volume of Ms. Petrov's virtual positions were not systematically correlated with Kyle Renfro's Day-Ahead generation offer bidding at the Indiana Hub in a manner suggesting coordination for manipulative purposes. Statistical analysis of the temporal relationship between Renfro's Day-Ahead offers and Petrov's virtual positions reveals no statistically significant pattern of coordination. The analysis controls for common market variables — such as weather, load forecasts, and gas price movements — that could independently explain any observed correlation.
(3) Ms. Petrov maintained her own independent market views and analysis regarding Minnesota Hub price dynamics, as reflected in her trading notes and communications with the Real-Time desk's risk management oversight.
CATEGORY F: COMPLIANCE PROGRAM AND REMEDIAL MEASURES
Exhibit F-1. Title: DPT Pre-Existing Compliance Policies and Procedures
Designation: Previously produced
Bates References: DUNMORE-138200 through DUNMORE-138567
Description: This exhibit consists of DPT's compliance manual and trading policies as in effect during the Relevant Period. The compliance manual addresses, among other topics, the prohibitions against market manipulation under the Federal Power Act and the Commission's Anti-Manipulation Rule, trading conduct standards, reporting obligations, and escalation procedures for potential compliance issues.
Respondents acknowledge that the compliance policies in effect during the Relevant Period were not as comprehensive or robust as the enhanced compliance program now being implemented (as described in Exhibits F-4 and F-5). However, the existence of a pre-existing compliance framework — including written policies addressing market manipulation prohibitions, designated compliance responsibilities, and training requirements — demonstrates that Respondents operated in good faith and maintained a compliance infrastructure prior to and during the Relevant Period. The pre-existing compliance framework provides relevant context for the Commission's assessment of any potential penalty, as the Commission has recognized in prior enforcement orders that the existence of a compliance program, even if imperfect, is a mitigating factor in the penalty calculus.
Exhibit F-2. Title: Appointment of Jennifer Caulfield as Chief Compliance Officer
Designation: Previously produced (Board resolution); RES-EX-F2 (supplemental background materials)
Bates References: DUNMORE-142300 through DUNMORE-142315 (Board resolution and appointment documentation)
Description: This exhibit contains the DEH Board of Directors resolution dated February 6, 2023, appointing Jennifer Caulfield as Chief Compliance Officer of Dunmore Energy Holdings Ltd., with responsibility for oversight of compliance across all DEH subsidiaries and affiliates, including DPT and DMP.
The timing of this appointment is significant. Ms. Caulfield was appointed on February 6, 2023 — more than three months before the Commission's preliminary inquiry letter was issued on May 22, 2023. This demonstrates that Dunmore proactively strengthened its compliance infrastructure in response to an internal assessment of compliance needs, not in reaction to the commencement of the FERC investigation. Ms. Caulfield's appointment reflects Dunmore's independent recognition that its compliance function required dedicated senior leadership and centralized oversight.
Ms. Caulfield brings significant qualifications to the role. She holds a J.D. from Georgetown University Law Center and has more than fifteen years of experience in energy regulatory compliance, including prior service as Associate General Counsel — Regulatory Compliance at a Fortune 500 energy company and as counsel to a national energy trade association. Her appointment as CCO with a direct reporting line to the DEH Board of Directors represents a meaningful enhancement of Dunmore's compliance governance.
Exhibit F-3. Title: DPT Compliance Training Records (2022–2023)
Designation: Previously produced
Bates References: DUNMORE-145800 through DUNMORE-146120
Description: This exhibit contains records of compliance training conducted for DPT trading personnel during calendar year 2022 and the first quarter of 2023. The training records document sessions covering market manipulation awareness, trading conduct standards, MISO market rules, and reporting obligations. Attendees included members of the Day-Ahead and Real-Time trading desks, including Kyle Renfro and Anastasia Petrov.
While Respondents recognize that the scope and frequency of compliance training during this period fell short of the enhanced standards now being implemented — including the commitment to a minimum of sixteen (16) hours per year of compliance training for all trading personnel — the existence of documented compliance training demonstrates that some compliance infrastructure was in place and that trading personnel received instruction on applicable legal and regulatory requirements. Respondents have committed to significantly enhanced training requirements going forward as part of the remedial measures described in Exhibits F-4 and F-5.
Exhibit F-4. Title: Enhanced Compliance Plan — Summary
Designation: RES-EX-F4
Prepared by: Ridgeway Compliance Solutions LLC, 3000 Richmond Avenue, Suite 800, Houston, TX 77098; Dr. Carolyn Whitford, Founder & Managing Director
Description: This exhibit presents a summary of the comprehensive enhanced compliance program being designed for Dunmore by Ridgeway Compliance Solutions LLC. Ridgeway was engaged by DEH on October 15, 2023 (see Exhibit F-5 for the engagement letter) to design, implement, and monitor an industry-leading compliance program that addresses the specific risks identified in this investigation and establishes robust, ongoing compliance infrastructure.
Dr. Carolyn Whitford, who leads the engagement, is a former attorney in the FERC Office of Enforcement, Division of Investigations, and brings specialized expertise in the design and implementation of compliance programs tailored to the Commission's enforcement priorities and penalty guidelines.
The enhanced compliance program incorporates the following key elements:
(1) Chief Compliance Officer Reporting Structure. The CCO (currently Jennifer Caulfield) will report directly to the DEH Board of Directors, with full authority and independence in the exercise of compliance oversight functions. The CCO will have direct, unimpeded access to the Board and will not be subject to direction or override by operating management on compliance matters.
(2) Annual Compliance Training. All DPT trading personnel, including traders, analysts, risk management staff, and trading desk supervisors, will be required to complete a minimum of sixteen (16) hours per year of compliance training, covering market manipulation prohibitions, MISO market rules, trading conduct standards, FTR compliance, virtual trading compliance, and reporting obligations.
(3) Quarterly Compliance Audits by Independent Monitor. An independent compliance monitor — to be selected in consultation with FERC OE — will conduct quarterly audits of DPT's trading activity, reviewing transaction patterns, offer pricing, FTR positions, virtual trading activity, and communications between trading and operations personnel.
(4) Automated Trade Surveillance Systems. DPT will implement automated trade surveillance technology capable of detecting anomalous trading patterns, including unusual correlations between Day-Ahead offers and FTR positions, unusual virtual trading activity, and potential coordination between physical and financial trading positions.
(5) Quarterly Reporting to FERC OE. DPT will submit quarterly compliance reports to the Office of Enforcement, summarizing trading activity, compliance audit results, training completions, and any identified compliance issues or investigations.
(6) Annual CEO and CCO Compliance Certification. The CEO of DEH (Gavin Harcourt) and the CCO (Jennifer Caulfield) will each provide an annual written certification to the DEH Board and to FERC that, to the best of their knowledge and based on reasonable inquiry, DPT's trading activity during the preceding year was conducted in compliance with the Federal Power Act, the Commission's Anti-Manipulation Rule, and applicable MISO market rules.
The enhanced compliance program is being designed for implementation on a rolling basis, with the first quarterly compliance audit to be conducted within ninety (90) days of program finalization, and full implementation of all program elements to be completed within one hundred eighty (180) days. Ridgeway Compliance Solutions LLC has been engaged at a flat fee of $385,000 for compliance program design, initial training, and a twelve-month monitoring period.
Exhibit F-5. Title: Ridgeway Compliance Solutions LLC Engagement Letter
Designation: RES-EX-F5
Date: October 15, 2023
Description: This exhibit is a copy of the engagement letter dated October 15, 2023, between Dunmore Energy Holdings Ltd. and Ridgeway Compliance Solutions LLC. The engagement letter sets forth the scope of Ridgeway's engagement, including compliance program design, implementation support, initial compliance training for all DPT trading personnel, and a twelve-month compliance monitoring period. The engagement letter identifies Dr. Carolyn Whitford as the lead engagement partner and specifies a flat fee of $385,000 for the scope of services described therein.
The engagement letter demonstrates Dunmore's concrete commitment to comprehensive remedial action and its investment in establishing a compliance program designed and overseen by a recognized expert in FERC enforcement and compliance matters.
CATEGORY G: COOPERATION WITH INVESTIGATION
Exhibit G-1. Title: Cooperation Summary