AICPA SOC Service Organizations - Certrec

OhmConnect, Inc. Ordered to Pay $150,000 (Civil Penalty of $141,094 and $8,906 Disgorgement) for CAISO’s Tariff Violation

Summary of NERC Penalties









Quarter 2 - April 2023

OhmConnect, Inc. 

CAISO’s Tariff

Section of CAISO’s Tariff

Ohm’s bids exceeded the registered metered load of all its customers


The Commission approved the Stipulation and Consent Agreement (Agreement) between the Office of Enforcement (Enforcement) and OhmConnect, Inc. (Ohm). Enforcement determined that between January and June 2018 a substantial majority of the bids Ohm made were bids that it could not reasonably expect to fulfill in violation of the Tariff because its bids exceeded the registered metered load of all its customers. The Agreement resolves Enforcement’s investigation under Part 1b of the Commission’s regulations, 18 C.F.R. Part 1b (2022), into violations of CAISO Tariff section, which requires resources to make bids that they reasonably expect to be able to fulfill. On April 10, 2023, Enforcement and Ohm agreed to terms that would resolve the Commission’s claims against Ohm. Ohm neither admitted nor denied liability and agreed to: (1) pay a civil penalty of $141,094 to the United States Treasury; (2) disgorge $8,906 to CAISO; and (3) be subject to compliance monitoring as detailed in the Agreement.

Ohm is a demand response provider participating in the CAISO market. Demand response providers do not generate electricity themselves but instead contract with individual customers to reduce the amount of electricity they would otherwise use. In California, demand response providers then aggregate this demand response under the California Public Utilities Commission’s (CPUC) Demand Response Auction Mechanism (DRAM) pilot program. 

Under the DRAM pilot program, demand response providers contract with Load-Serving Entities (LSEs) to provide a given amount of demand response. Each month, demand response providers tell the LSEs how much demand response they would provide 90 days later, and those load reductions become part of the LSEs’ supply plans. The LSEs, in turn, submit their supply plans (including demand response) to CAISO to substantiate the Resource Adequacy capacity contracted by the LSE.

Under this program, Ohm, a California demand response provider, bid the same amounts of demand response each day as it had contracted with the LSEs into CAISO’s day ahead (DA) energy market. A substantial majority of the bids Ohm made into the DA market in the first six months of 2018 exceeded the registered metered load of the individual customers whose potential demand response was aggregated into Ohm’s bids. Consequently, between January and June 2018, Ohm submitted bids into the DA market that it could not fulfill with registered load. 

In May and June 2018, Ohm received Resource Adequacy Availability Incentive Mechanism (RAAIM) payments that it would not have received if it had made accurate bids.

About Certrec:
Certrec is a leading provider of regulatory compliance solutions for the energy industry with the mission of helping ensure a stable, reliable, bulk electric supply. Since 1988, Certrec’s SaaS applications and consulting expertise have helped hundreds of power-generating facilities manage their regulatory compliance and reduce their risks.

Certrec’s engineers and business teams bring a cumulative 1,500 years of working experience in regulatory areas of compliance, engineering, and operations, including nuclear, fossil, solar, wind facilities, and other Registered Entities generation and transmission.

Certrec has helped more than 120 generating facilities establish and maintain NERC Compliance Programs. We manage the entire NERC compliance program for 60+ registered entities in the US and Canada that trust us to decrease their regulatory and reputational risk. Certrec is ISO/IEC 27001:2013 certified and has successfully completed annual SOC 2 Type 2 examinations.

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