On 21 April 2011 the Federal Energy Regulatory Commission (FERC) proposed a rule that would require publicly owned utilities (e.g., electric cooperatives and municipally-owned electric utilities) to file electric quarterly reports (EQRs). The Notice of Proposed Rulemaking (NOPR) also proposes certain revisions to the existing EQR filing requirements, which would apply to all market participants filing EQRs.
The NOPR follows a related Notice of Inquiry (NOI) issued on 21 January 2010 which resulted in the submission of 40 comments, many of which were submitted by power companies and electric cooperatives questioning FERC's authority and rationale behind imposing EQR filing requirements on public power. Comments on the NOPR will be due by approximately the end of June, 60 days after publication in the Federal Register.
New reporting requirements for public power
Currently, public utilities are required to electronically file EQRs summarizing transaction information for short-term and long-term cost-based sales and market based rate sales and the contractual terms and conditions in their agreements for all jurisdictional services. This requirement presently excludes public power entities outside of FERC's jurisdiction under section 205 of the Federal Power Act (i.e., public utilities). Under price transparency authority granted under Section 220 of the Federal Power Act, FERC proposes in the NOPR to expand these requirements to non-public utilities with more than a de minimis market presence in wholesale markets. The NOPR proposes to set the de minimis threshold at 4 million MWh of annual wholesale sales for a non-public utility, or 1 million MWh of annual wholesale sales for a non-public utility balancing authority (defined as the responsible entity that integrates resource plans ahead of time, maintains load-interchange-generation balance within a Balancing Authority Area, and supports Interconnection frequency in real time). Both amounts are calculated based on an average of wholesale sales made by the utility in the preceding three years.
Citing data made available in the 2009 U.S. Energy Information Administration's Annual Electric Power Industry Report, FERC noted that non-public utilities account for significant volumes of the 3.2 billion MWh of total annual wholesale electricity sales made within the 48 contiguous states (excluding ERCOT). In particular, about 29 per cent of those wholesale sales are made by non-public utilities. Additionally, non-public utilities account for 60 and 70 per cent of wholesale sales within the Western Electric Coordinating Council and SERC Reliability Corporation regions, respectively, and about 80 per cent of all wholesale sales that occur within the Florida Reliability Coordinating Council. Using this data, FERC concluded that, given non-public utilities' significant presence in national and regional wholesale electricity markets, obtaining this additional information will assist in providing greater price transparency, promoting competition, and providing a better means to detect and discourage discriminatory practices. To help alleviate the burden of filing EQRs, FERC has in place a system that allows EQRs to be filed electronically via the internet. FERC also stated that it will make every effort to provide technical assistance to non-public utilities prior to the implementation of the EQR filing requirements.
New data requirements for all filers
In addition to the proposal that non-public utilities be required to file EQRs, the NOPR revises the EQR filing requirements for all filers.
These revisions include the addition of new fields for:
- reporting the transaction date and time and the type of rate prospectively from the time the requirements are implemented;
- indicating whether the sales transaction was reported to an index publisher;
- identifying the broker or exchange used for a sales transaction, if applicable; and
- reporting electronic tag (e-Tag) ID data (we note that a proposed rule requiring e-Tags to be made available to FERC Staff was released concurrently with this NOPR).
The NOPR also proposes certain changes to the EQR data fields currently required:
- eliminate the time zone from the contract section;
- eliminate the Data Universal Numbering System (DUNS) data requirement; and
- standardize the unit for reporting energy and capacity transactions so that energy transactions will be reported as $/MWh and capacity transactions will be reported as $/MWh-month.
FERC issued this NOPR concurrently with a separate proposal to give FERC Staff access to e-Tag data that is submitted to NERC. Combined, the two proposals will greatly enhance FERC's market oversight and enforcement capabilities.