Sens. Joseph Lieberman (D-CT) and Jean Carnahan (D-MO) have called on the General Accounting Office (GAO) to keep a close eye on FERC’s performance in monitoring the energy industry over the next year.

The senators’ request came on the heels of GAO’s unflattering report that said the Federal Energy Regulatory Commission lacked the “enforcement bite” to effectively police the energy industry. It concluded the agency needed greater authority from Congress to issue civil penalties against market abusers, more market-savvy employees, a bigger budget and a more aggressive monitoring presence in the natural gas and electricity industries, if it is to become effective in the future. The GAO conducted its 10-month review of FERC at the urging of both senators.

“The agency’s record, as documented by GAO, indicates that FERC has failed to take even the most basic steps” toward monitoring competitive energy markets, wrote Lieberman, chairman of the Senate Governmental Affairs Committee, in a letter to Comptroller General David M. Walker following the release of the GAO report in late June.

Consequently, “we are requesting that [the] GAO monitor and report to us within the next 12 months” on the Commission’s implementation of the various recommendations in the GAO report, and on FERC’s progress in establishing an effective market oversight and enforcement capability, including, but not limited to, the creation of the agency’s new Office of Market Oversight and Investigation.

“We hope that FERC will heed the GAO’s recommendations and move expeditiously to correct this egregious situation,” Lieberman said.

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