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* FERC says bank does not have right to privacy
* Barclays said was wrongly targeted by regulator
* Ruling should shape fight over $470 million fine
WASHINGTON, Feb 26 (Reuters) - Details of Barclays' fightwith the U.S. energy regulator over alleged power marketmanipulation will be made public now that officials haverejected the investment bank's claim the probe is a publicitystunt.
Barclays Plc had said the Federal Regulatory EnergyCommission was pursuing a case against the bank "to garneradditional publicity for its own enforcement activities whileseeking to portray Barclays negatively," according to an Augustfiling from the bank that has just been made public.
The regulator found that Barclays manipulated the Californiapower market from late 2006 to 2008 and should pay $470 millionin fines.
According to the FERC, the British bank and four of itstraders used losses in physical markets to make gains infinancial markets and they knew their activity was unlawful.
Barclays has challenged the regulator's finding in a seriesof filings and sought "confidential" treatment of some elementsof its defense.
Two weeks ago, the FERC rejected Barclays bid forconfidentiality and about a dozen briefs were made public on theregulator's website late on Monday.
The battle over the record fine is becoming a test of theFERC's authority to protect consumers and investors fromwrongdoing in energy markets.
Among other things, the FERC investigation uncovered traderbanter that the British bank has termed "unfortunate." The fourtraders boasted in emails and instant messages about how "fun"it was to "crap on" physical power prices on the West Coast.
Bank defenders argue that more trades add healthy liquidityto the market and are in the interests of consumers.
Congress in 2005 expanded the FERC's powers in the wake ofthe Enron electricity manipulation scandals in the westernUnited States earlier in the decade.
If Barclays continues to fight and there is no settlement,the dispute is expected to land in federal court.
Officials at Barclays declined to comment.
Barclays was last year fined about $450 million for rigginga key benchmark lending rate.
