---
title: FERC Settles with Terra-Gen for CAISO Tariff and Reporting Violations
description: This week, FERC announced a significant enforcement settlement with Terra-Gen LLC. The case relates to the violation of the California Independent System Operator (CAISO) Open Access Transmission Tariff, FERC’s Market Behaviour Rule, and its Anti-Manipulation Rule involving Terra-Gen’s participation in the CAISO ancillary services market between 2020 and 2022.
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---
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# FERC Settles with Terra-Gen for CAISO Tariff and Reporting Violations
RegTrail | 10 April, 2026
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This week, FERC announced a significant enforcement settlement with Terra-Gen LLC. The case relates to the violation of the California Independent System Operator (CAISO) Open Access Transmission Tariff, FERC’s Market Behaviour Rule, and its Anti-Manipulation Rule involving Terra-Gen’s participation in the CAISO ancillary services market between 2020 and 2022.
Terra-Gen selectively avoided CAISO regulation-down awards for two of its combined wind and battery storage resources (Mojave 89 and Mojave 90). They achieved this by disconnecting them from automatic generation control or claiming unjustified outages during high Locational Marginal Price hours. Terra-Gen also violated FERC’s Duty of Candor Rule relating to a compliance report submitted to FERC for a previous, unrelated settlement.
A former Vice President of Origination was found to have knowingly breached the CAISO Tariff with emails stating as much. Internal communications explicitly showed the VP instructing the team to leave the market to limit lost revenue. Failing to properly adhere to compliance reporting obligations placed on the firm from a previous, unrelated breach clearly rubbed FERC up the wrong way. Prior to submitting a mandatory compliance report, a senior executive knowingly withheld the CAISO Tariff violations, actively misleading the regulator while internal discussions continued.
#### Settlement and Remedial Actions
[FERC determined violations](https://www.ferc.gov/civil-penalties/all-civil-penalty-actions-2026#:~:text=The%20Agreement%20resolves%20Enforcement%27s%20investigation,Independent%20System%20Operator%20(CAISO)%20Open) of the CAISO Tariff, Market Behaviour Rule, Duty of Candor Rule, and Anti-Manipulation Rule. Terra-Gen admitted to all except the Anti-Manipulation Rule breach. They agreed to a civil penalty of USD 4,950,000 and a disgorgement of USD 681,007. They must also submit annual compliance monitoring reports to FERC for two years.
The extensive list of positive changes made to Terra-Gen’s internal compliance programme probably saved them a larger fine and may be a useful checklist for firms active in the US ISO/RTO markets. They executed the following measures:
- Terminated the employment of the VP of Origination.
- Established an internal energy market compliance function reporting to the Chief Environment, Health and Safety Officer.
- Created dedicated compliance roles for FERC regulations and CAISO requirements.
- Implemented an anonymous reporting tool through a third-party service for employees.
- Mandated rigorous external training and comprehensive third-party audits focused on CAISO Tariff compliance.
- Updated their internal Code of Ethics to include an emphasised obligation to report suspected violations.
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