As policymakers continue to assess the damage wrought by devastating blackouts in Texas and neighboring states, the Federal Energy Regulatory Commission on Feb. 22 announced it will look into potential market manipulation as natural gas and electricity prices soared during the days-long event.

And with scientists linking a rare Arctic storm in the U.S. South to climate change, FERC also announced a separate formal proceeding "to examine the threat that climate change and extreme weather events pose to electric reliability."

Natural gas prices in the Western U.S. shot to new highs as much of the Midwest and South was enveloped by a sudden rush of frigid Arctic air last week. On Feb. 16, a day after the Electric Reliability Council Of Texas Inc. ordered rotating blackouts, prices at the Waha Hub in the Texas Permian Basin climbed nearly 50 times higher than normal for gas flows on that date, according to S&P Global Market Intelligence data.

Electricity prices also hovered near ERCOT's $9,000/MWh administrative price cap throughout the cold snap and reached record levels at price hubs within the Southwest Power Pool's 14-state footprint.

With ERCOT at one point reporting roughly one-third of its anticipated thermal generating capacity offline due in part to low pipeline flows, Texas Gov. Greg Abbott issued an executive order requiring natural gas suppliers to offer fuel to gas-fired power plants in Texas before shipping it outside of the state.

Volatility in the natural gas market also prompted the California ISO to submit an emergency compliance filing to FERC seeking to allow electricity suppliers to submit fuel costs where incremental energy bids are above $1,000/MWh.

CAISO explained in a press release that the move was aimed at providing "immediate assurance that suppliers are not at risk due to higher than normal fuel costs and will help provide access to gas resources during these volatile conditions."

In a Feb. 22 news release, FERC said that its Office of Enforcement will pursue any evidence of potential wrongdoing as nonpublic investigations. The examination into potential wrongdoing will occur as part of the office's ongoing surveillance of market participant behavior in wholesale power and natural gas markets, FERC said.

Meanwhile, the launch of a new climate change and grid resilience proceeding comes after FERC voted last week to terminate a separate grid resilience proceeding initiated after the commission in January 2018 unanimously rejected a Trump administration proposal to subsidize at-risk coal and nuclear plants capable of storing fuel on-site.

"The resiliency challenges facing the nation differ dramatically from region to region," Chairman Richard Glick said at the commission's Feb. 18 monthly open meeting. "The only reasonable way to address these different threats is through a region-by-region approach."

Asked how the new climate and resilience proceeding will differ from the Trump-era proceeding, Glick noted in a statement to S&P Global Market Intelligence that it marks "the first time" FERC "will address the urgent threat climate change poses to electric reliability, recognizing that the threats will vary from region to region."

"Any action that may be taken will be on a region-by-region or case-specific basis," Glick added. "In contrast, the previous proceeding grew out of a political effort to bail out certain resources. That proceeding was dormant for years while the threat of extreme weather accelerated."

In its news release, FERC noted that the new proceeding, which does not currently have a docket number, will include a technical conference with additional details to follow.

Commissioner Neil Chatterjee, who dissented from last week's order to terminate the previous grid resilience docket, expressed support for the new proceeding.

"I'm glad @FERC is reopening the #resilience docket, albeit under a new name, to comprehensively explore the nationwide threat climate change and extreme weather events pose to the bulk electric system," Chatterjee wrote on Twitter.