Heeding calls from wholesale energy market participants, the Federal Energy Regulatory Commission ("FERC") has issued a new notice of proposed rulemaking ("NOPR") concerning the collection of data from market participants with market-based rate ("MBR") authority and other entities that trade virtual products or hold financial transmission rights in organized wholesale electric markets. Virtual products are those that do not end in a physical delivery, while financial transmission rights are financial contracts that can help offset transmission-related costs. The purpose of the NOPR is to improve FERC’s ability to observe the financial and legal connections among market participants and other entities in FERC-jurisdictional markets, as well as to enhance its market analytics and surveillance capabilities. In order to ease the information collection burden on such entities, FERC is requiring the use of a relational database, which will help eliminate duplication of inputs and facilitate access to the data.
While the NOPR proposes a number of new or revised information reporting requirements, a few are summarized here. Under current regulations, market participants with MBR authority are required to provide information on their affiliates and upstream ownership structure. FERC proposes to revise and narrow that requirement to affiliate owners that satisfy certain criteria. Market participants would also be required to provide ownership information concerning ownership or control by a foreign government or an entity controlled by a foreign government. In addition, market participants would be required to affirm the qualifications of passive ownership entities. The NOPR also proposes to require entities with MBR authority, as well as entities that trade virtual products or hold financial transmission rights, to provide connected entity information. That information would be provided directly by the entity to FERC. A connected entity is defined to including the following: (1) an entity that is an affiliate of the market participant that meets certain criteria, (2) the market participant’s traders (as defined in the NOPR) or (3) contracts pertaining to control over a generation asset. The full list of proposed reporting requirements can be found in the NOPR, titled "Data Collection for Analytics and Surveillance and Market-Based Rate Purposes," 156 FERC ¶ 61,045 (2016). Comments on the NOPR are due on September 19, 2016.