Power & Pipes

FERC, CFTC, and State Energy Law Developments

On March 15, FERC issued a Notice of Proposed Rulemaking to revise the Electric Quarterly Report (EQR) Data Dictionary so parties can more accurately report simultaneous exchanges.[1] FERC proposed adding “Simultaneous Exchange” to the list of available Product Names in the EQR to enable parties to differentiate simultaneous exchange transactions from transmission service. FERC recently expressed concerns that certain simultaneous exchange transactions could resemble transmission service without the reservation of service on the transmission system. In both situations, a party places power onto the power grid at a delivery point and simultaneously receives power at another point. However, a simultaneous exchange occurs when a pair of wholesale power transactions between the same counterparties are arranged as part of the same negotiations and involve overlapping delivery periods and volumes of power purchased and sold.

FERC proposed the four following amendments:

  • The Product Name “Simultaneous Exchange” should be added to the EQR Data Dictionary.
  • Reporting parties should report only the overlapping portions of a simultaneous exchange transaction as a simultaneous exchange. The non-overlapping portions should be reported as a power sale.
  • The price reported for a simultaneous exchange should be the difference between the prices at the delivery and receipt points (the price spread), instead of the nominal prices assigned to the power.
  • Parties entering into a simultaneous exchange transaction should report both the delivery and receipt points.

In addition to improving the accuracy of reporting simultaneous exchanges, FERC expects the proposed amendments will advance its objectives behind establishing the EQR reporting requirements, which include “providing greater price transparency, promoting competition, instilling confidence in the fairness of the markets, and providing a better means to detect and discourage discriminatory practices.”[2]

Comments on the proposed amendments are due 60 days after publication in the Federal Register.

[1] Revised Public Utility Filing Requirements for Electric Quarterly Reports, 138 FERC ¶ 61,191 (Mar. 15, 2012).

[2] Id. at ¶ 4.