AICPA SOC Service Organizations - Certrec

Vitol and Corteggiano Fined $2,300,000 for Violation of Federal Power Act

Summary of NERC Penalties









Quarter 1 - January 2024

Vitol Inc. and Federico Corteggiano

FERC's Regulations

Section 1c.2 of the Commission’s Regulations and Section 222a of the Federal Power Act

Selling physical power at a loss in the CAISO market to manipulate congestion and affect Vitol’s congestion revenue rights. This was established following an Order to Show Cause proceeding and a subsequent Order Assessing Civil Penalties.



On January 4, 2024, the Federal Energy Regulatory Commission (FERC) issued an Order approving a Stipulation and Consent Agreement (Agreement) between the FERC Office of Enforcement (Enforcement) and Vitol and Corteggiano (VIC). The Agreement resolves the litigation between Defendants and the Commission for violations of section 1c.2 of the Commission’s regulations and section 222a of the Federal Power Act in FERC v. Vitol Inc. and Federico Corteggiano, Case No. 2:20-CV-00040-KJM-AC (E.D. Cal.). Vitol will pay $2,225,000 in civil penalties to the United States Treasury, and Mr. Corteggiano will pay $75,000 in civil penalties to the United States Treasury, for a total payment of $2,300,000 in civil penalties. VIC is a Delaware corporation, with its principal place of business in Houston, Texas. It is a power marketer that trades wholesale electric power in the California Independent System Operator’s (“CAISO”) electric power market. Mr. Corteggiano resides in Texas and is an employee of VIC.

Additional Discussion:

Following an order to Show Cause proceeding, the Commission issued an Order Assessing Civil Penalties on October 25, 2019, against Vitol, Inc., (Vitol) and Federico Corteggiano (Corteggiano), finding that Vitol and Corteggiano violated section 1c.2 of the Commission’s regulations and section 222a of the Federal Power Act (FPA) by selling physical power at a loss in the California Independent System Operator’s wholesale electric market in order to eliminate congestion that they expected to cause losses on Vitol’s congestion revenue rights. The order assessed disgorgement and civil penalties as outlined for the violations. During the Order to Show Cause proceeding, Vitol and Corteggiano elected the procedures of FPA section 31(d)(3), in which the Commission assesses a civil penalty and if it is not paid within 60 days, the Commission institutes an action in federal district court to affirm the assessment. The Commission filed suit against Vitol and Corteggiano in the Eastern District of California on January 6, 2020.

Associated Files:
20240104-186FERC61008-IN14-4-000-Vitol Inc et al-Settlement Agreement

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 200 generating facilities establish and maintain NERC Compliance Programs. We manage the entire NERC compliance program for 80+ registered entities in the US, Canada, and Mexico 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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