The Federal Energy Regulatory Commission issued an order to show cause against Maxim Power yesterday, telling the Canadian independent power producer to explain why it shouldn’t have to pay a $5 million fine for allegedly misrepresenting the output of three of its generators in ISO-NE (IN15-4).

FERC says that in July and August of 2010, when asked about the company’s offers on the day-ahead market, Maxim employee Kyle Mitton told ISO-NE’s Market Monitor that the generators were unable to procure gas, so it was forced to burn more expensive oil.

FERC says, however, that Maxim purchased large quantities of gas before submitting its offers at the price of oil the same day. FERC assessed Mitton a $50,000 proposed penalty separately from the company.

FERC’s Office of Enforcement issued a Notice of Alleged Violations in November. (See FERC Staff Accuses Maxim Power of Cheating ISO-NE.) The notice included two other alleged schemes by Maxim: gaming ISO-NE market mitigation rules in 2012 to 2013, and boosting its generators’ outputs during testing using “extraordinary measures” in order to collect inflated capacity payments from 2010 to 2013. The order to show cause does not mention these allegations.

Commissioner Tony Clark dissented, saying he did not think the Enforcement staff report and Maxim’s responses justified the order. “Nonetheless, in the next phase of the proceeding, both FERC Enforcement staff and the respondents will have an opportunity to more fully develop the record,” he wrote. “As such, I make no prejudgment as to the final disposition of this case.”

Commissioner Norman Bay, who headed the Office of Enforcement during most of the investigation, did not participate in the decision.