WASHINGTON, July 31, 2012 /PRNewswire/ -- More companies are self-reporting possible inappropriate behavior by traders to the U.S. Federal Energy Regulatory Commission (FERC) because of the agency's increased focus on preventing manipulation of the electricity and natural gas markets, FERC Chairman Jon Wellinghoff said Tuesday at a Platts Energy Podium.
Speaking to reporters at the Washington, D.C., event, Wellinghoff said the activities of FERC's new analytics and surveillance division are a "huge deterrent" to market manipulation.
"We are starting to get something that we've never gotten before, that's self reports," he said.
In more than one instance, Wellinghoff said, a senior company executive has told FERC, "We found a trader doing something that we thought you may view as inappropriate."
The trend "tells me our enforcement efforts are very effective," he added.
FERC's enforcement staff is examining any attempts to manipulate electricity and gas markets.
"I've told the office to go in those areas that are the most productive," Wellinghoff said.
Wellinghoff also offered his views on gas-electricity coordination, a topic that pipeline companies, generators, grid operators and other experts will discuss at a series of FERC technical conferences in August.
The commission is "taking in ideas," which include changes in gas tariffs, scheduling and nominations, Wellinghoff said, noting that he was "still open to regulatory solutions" if they are needed to prevent power outages due to inadequate supplies of the fuel.
Any rule or policy changes by FERC would need to recognize key local differences, such as the fact that New England "is a peninsula in the pipeline system," he said. Other regions are served by more than one network of gas pipelines, the chairman said.
Turning to transmission, Wellinghoff said staff and commissioners are starting to float proposals internally for changing FERC's policy for awarding developers of interstate lines incentives such as higher base rates of return on equity.
While FERC has no regulatory role in responding to the massive power outage in India, the chairman said the commission is studying the event closely for any lessons for the stability of the U.S. grid.
"I think we have a good handle on reliability, but we're certainly looking at India to see if there is something larger we can learn," Wellinghoff said.
A Democrat, Wellinghoff was first appointed as a commissioner in 2006 by President George W. Bush and was named chairman in 2009 by President Barack Obama. Prior to joining FERC, he was in private practice, focusing on regulatory, consumer and commercial law.
A recording of the Jon Wellinghoff session is available via podcast at this link: : http://plts.co/PEP0731
Sponsored by Platts, a leading global energy, petrochemicals and metals information provider, Platts Energy Podium provides an ongoing forum for prominent newsmakers and the press to address important energy and environmental issues.
For more information on energy and energy policy, visit the Platts website at www.platts.com.
About Platts: Founded in 1909, Platts is a leading global provider of energy, petrochemicals and metals information and a premier source of benchmark prices for the physical and futures markets. Platts' news, pricing, analytics, commentary and conferences help customers make better-informed trading and business decisions and help the markets operate with greater transparency and efficiency. Customers in more than 150 countries benefit from Platts' coverage of the carbon emissions, coal, electricity, oil, natural gas, metals, nuclear power, petrochemical, and shipping markets. A division of The McGraw-Hill Companies (NYSE: MHP), Platts is headquartered in New York with approximately 900 employees in more than 15 offices worldwide. Additional information is available at http://www.platts.com.
About The McGraw-Hill Companies: McGraw-Hill announced on September 12, 2011, its intention to separate into two public companies: McGraw-Hill Financial, a leading provider of content and analytics to global financial markets, and McGraw-Hill Education, a leading education company focused on digital learning and education services worldwide. McGraw-Hill Financial's leading brands include Standard & Poor's Ratings Services, S&P Capital IQ, S&P Indices, Platts energy information services and J.D. Power and Associates. With sales of $6.2 billion in 2010, the Corporation has approximately 21,000 employees across more than 280 offices in 40 countries. Additional information is available at http://www.mcgraw-hill.com/.