FERC on Thursday approved MISO’s proposal to bar participants from its market when it identifies evidence of default, manipulation or unreasonable risk. The new procedures took effect Saturday (ER20-877).

The Tariff changes allow MISO to request additional collateral when it perceives an unreasonable credit risk from a market participant. The new rules will also allow the RTO to reject applications from new market participants and from former market participants that have an uncured financial default in its markets and attempt to rejoin under a different name.

Finally, the RTO will ask prospective and current market participants for more specifics on their annual certifications. It will inquire about past defaults, bankruptcies, dissolutions, mergers or acquisitions and any investigations. (See MISO Looks Beyond FTRs for Market Protections.)

“The proposed revisions will allow MISO to improve the protection of its market participants from financial losses that result from unreasonable credit risks and defaults while also providing additional clarity and transparency to market participants,” FERC said.

The commission also pointed out that MISO has pledged to “preserve in writing” any decision it makes to reject or suspend a market participant from participation. FERC said the RTO’s written reasoning could “form a record before a commission proceeding if necessary.”

FERC said MISO made the filing “in light of significant credit events in other” RTOs/ISOs, referencing GreenHat Energy’s record default in PJM’s financial transmission rights market in June 2018. PJM last week approved tightened credit requirements to prevent future defaults. (See related story, PJM Members OK Tighter Credit Rules.)

The revisions are an extension of stepped-up requirements in MISO’s FTR market. The RTO received FERC permission in November to apply higher collateral requirements to the market (ER20-73).

— Amanda Durish Cook