The Federal Energy Regulatory Commission took action to ensure consumer protection in transparent wholesale electric markets last month when it issued a Notice of Inquiry into whether to broaden its oversight of transactions by market participants that are excluded from FERC jurisdiction under section 205 of the Federal Power Act (FPA).

FERC-regulated utilities now file quarterly reports of transaction information that help ensure that consumers and FERC can monitor power sales for indications of market power. These Electric Quarterly Reports summarize contract terms and conditions in agreements for all jurisdictional power sales. 

This inquiry seeks public comment on whether FERC should extend the filing requirements to market participants that are excluded from FERC jurisdiction under Section 205 of the FPA. Those include publicly owned utilities, municipal utilities, public utility districts, rural cooperatives and federal entities.

The U.S. Energy Information Administration estimated in 2007 that these publicly owned electric utilities made 29 percent of electric utility sales. Obtaining certain information from the quarterly reports from such entities will help improve FERC’s ability to effectively examine and monitor price formation, the number of sales and the market concentration occurring in electric markets where these market participants play a large role, FERC said.

The Energy Policy Act of 2005 expanded FERC’s authority to protect consumers by ensuring transparency in natural gas and electric markets. In natural gas markets, FERC in 2008 extended the interstate pipelines’ transaction reporting requirements to certain intrastate pipelines. The Commission at the time declined to take similar action in wholesale electric markets because it was evaluating transparency issues in other proceedings. Because those proceedings did not specifically address price transparency in electric markets, FERC now is asking whether the quarterly report requirements should be expanded.

Also as part of the inquiry, FERC is seeking comments on whether it should consider other refinements to the existing quarterly report filing requirements.

Comments on the Notice of Inquiry, Electricity Market Transparency Provisions of Section 220 of the Federal Power Act, are due 60 days after publication in the National Register.