North America Power Partners (NAPP) responded today to a notice dated February 25, 2011 from the Federal Energy Regulatory Commission (“FERC”). FERC Office of Enforcement staff made a preliminary determination that certain unauthorized activity of Joseph Polidoro violated the Commission’s Prohibition of Electric Energy Market Manipulation, 18 CFR § 1c.2 (2010). Prior to December 2008, when his employment was terminated, Mr. Polidoro was NAPP’s former Senior Vice President of Operations. Polidoro has not been involved in NAPP’s operations since that time. NAPP has cooperated fully with FERC enforcement staff since becoming aware of Mr. Polidoro’s unauthorized trading activities, In October 2010, NAPP agreed to disgorge all profits it received as a result of those activities.

North America Power Partners is a leading provider of Demand Response services in the US since 2006. NAPP provides reliability and energy resources in the capacity, energy and reserves markets of the PJM market (the largest wholesale electric market in the US). NAPP also operates in the NY ISO market, NE ISO market and in California.

NAPP is fully committed to complying with all applicable ISO and FERC rules and regulations. NAPP has been operating uninterrupted in the PJM market since 2007 and has PJM’s support as a valuable market participant in demand response. NAPP has taken measures to prevent fraudulent or improper activity and to ensure that these types of activities do not occur in the future. NAPP has been, and continues to be, a member in good standing with PJM.

According to NAPP’s President and founder, Laurie Wiegand-Jackson, “NAPP takes its obligation to comply with all rules and regulations in the markets in which we participate very seriously. NAPP’s commitment to compliance with FERC and the ISO rules and regulations is a critical objective of the company. We have developed a corporate compliance program that establishes us as a leader in this area, incorporating internal auditing, internal controls and effective management oversight of our market operations.”

Demand Response is a developing program that has been implemented in some US electric wholesale markets since the early 2000’s. It is the temporary reduction or change in electric demand in response to an emergency call event or high price signal. NAPP develops and manages the Demand Response capabilities of its commercial and industrial customers in wholesale electric markets. NAPP’s customers obtain a revenue stream for being an available resource for the electric grid. These customers reduce their use of electricity when called upon by NAPP and receive similar payments to the generators and transmission operators that provide electricity to the grid. As an emerging resource, the market rules and regulations have developed over time and continue to change in response to increased experience and related technology advancements. NAPP supports FERC’s efforts to include Demand Response as a viable and critical resource, to enforce its established market rules and fulfill its quest for transparent and fair markets.