
[Federal Register: October 26, 2011 (Volume 76, Number 207)]
[Proposed Rules]               
[Page 66211-66220]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26oc11-21]                         

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 35

[Docket No. RM11-17-000]

 
Enhancement of Electricity Market Surveillance and Analysis 
Through Ongoing Electronic Delivery of Data From Regional Transmission 
Organizations and Independent System Operators

AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: 

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otice of proposed rulemaking.

SUMMARY: The Federal Energy Regulatory Commission (Commission) proposes 
to revise its regulations to require each regional transmission 
organization (RTO) and independent system operator (ISO) to 
electronically deliver to the Commission, on an ongoing basis, data 
related to the markets that it administers. Ongoing electronic delivery 
of data relating to physical and virtual offers and bids, market 
awards, resource outputs, marginal cost estimates, shift factors, 
financial transmission rights, internal bilateral contracts, and 
interchange pricing will facilitate the Commission's development and 
evaluation of its policies and regulations and will enhance Commission 
efforts to detect anti-competitive or manipulative behavior, or 
ineffective market rules, thereby helping to ensure just and reasonable 
rates.

DATES: Comments on the proposed rule are due December 27, 2011.
    Comments, identified by docket number, may be filed in the 
following ways:
     Electronic Filing through http://www.ferc.gov. Documents 
created electronically using word processing software should be filed 
in native applications or print-to-PDF format and not in a scanned 
format.
     Mail/Hand Delivery: Those unable to file electronically 
may mail or hand-deliver comments to: Federal Energy Regulatory 
Commission, Secretary of the Commission, 888 First Street, NE., 
Washington, DC 20426.
    Instructions: For detailed instructions on submitting comments and 
additional information on the rulemaking process, see the Comment 
Procedures Section of this document.

FOR FURTHER INFORMATION CONTACT:

William Sauer (Technical Information), Office of Enforcement, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-6639, william.sauer@ferc.gov.
Christopher Daignault (Legal Information), Office of the General 
Counsel, Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-8286, christopher.daignault@ferc.gov.

SUPPLEMENTARY INFORMATION:

Notice of Proposed Rulemaking

October 20, 2011.
    1. In this Notice of Proposed Rulemaking (NOPR), the Federal Energy 
Regulatory Commission (Commission) proposes, pursuant to sections 
301(b) and 307(a) of the Federal Power Act (FPA),\1\ to amend its 
regulations to require each regional transmission organization (RTO) 
and independent system operator (ISO) to electronically deliver to the 
Commission, on an ongoing basis, data related to the markets that it 
administers. Ongoing electronic delivery of data relating to physical 
and virtual offers and bids, market awards, resource outputs, marginal 
cost estimates, shift factors, financial transmission rights (FTR), 
internal bilateral contracts, and interchange pricing will facilitate 
the Commission's development and evaluation of its policies and 
regulations and will enhance Commission efforts to detect anti-
competitive or manipulative behavior, or ineffective market rules, 
thereby helping to ensure just and reasonable rates.
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    \1\ 16 U.S.C. 825(b), 825f(a).
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I. Background

    2. Wholesale electricity markets have witnessed tremendous change 
in recent years. In the decades after the 1935 enactment of the FPA, 
the industry was characterized by self-sufficient, vertically 
integrated utilities. Most utilities built their own generation, 
transmission, and distribution facilities

[[Page 66212]]

and sold electricity to their own wholesale and retail customers. 
During this time, the Commission regulated jurisdictional entities' 
rates through traditional cost-based ratemaking. Cost-based rate 
regulation ensures that rates are just and reasonable by 
administratively determining an entity's cost of providing service. 
Changes in national policy and other forces led to increased 
coordination and competition in the late 1960s and 1970s,\2\ and the 
enactment of the Public Utility Regulatory Policies Act (PURPA).\3\ The 
1980s and early 1990s experienced an increased adoption of market-based 
ratemaking and wholesale power sales competition to promote efficiency 
and to lower wholesale power prices.\4\
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    \2\ Counted among such forces are the Northeast blackout of 1965 
and the responses to perceived transmission system insufficiencies, 
as well as the subsequent oil crisis of 1973. For a discussion of 
developments following the 1965 blackout, see William F. Fox, Jr., 
Federal Regulation of Energy 749, 755 (1983 & Supp. 1993), and 
Stephen Breyer and Paul W. MacAvoy, The Federal Power Commission and 
the Coordination Problem in the Electrical Power Industry, 46 S. 
Cal. L. Rev. 661, 661 (1973).
    \3\ Public Utility Regulatory Policies Act of 1978, Pub. L. No. 
95-617, 92 Stat. 3117 (1978) (codified as amended in scattered 
sections of 16 U.S.C.); see, e.g., 16 U.S.C. 824a-3, 824i, 824j.
    \4\ See, e.g., Louisville Gas & Elec. Co., 62 FERC ] 61,016, at 
61,143 & n.16, 61,149 (1993) (accepting non-traditional, market-
based rates as consistent with primary regulatory goal of ensuring 
lowest reasonable cost energy to consumers, provided service is 
reliable and the seller demonstrates a lack of market power); Pac. 
Gas & Elec. Co., 38 FERC ] 61,242, at 61,790 (1987) (accepting 
proposed competitive rates because ``competition * * * encourages 
utilities to make efficient decisions with a minimum of regulatory 
intervention [and, u]ltimately, consumers should benefit from lower 
prices as competition improves efficiency.''), modifying on other 
ground, 47 FERC ] 61,121 (1989), modified, 50 FERC ] 61,339 (1990), 
modified sub nom. W. Sys. Power Pool, 55 FERC ] 61,099, at 61,319 
(addressing applicant's failure to eliminate anticompetitive effects 
by mitigating market power), granting stay, 55 FERC ] 61,154, reh'g 
granted in part, 55 FERC ] 61,495 (1991), modified, 59 FERC ] 61,249 
(1992); Pub. Serv. Co. of New Mexico, 25 FERC ] 61,469, at 62,038 
(1983) (averring that ``competition penalizes a seller that is 
inefficient or has an unreasonable pricing strategy[; consequently,] 
consumers * * * benefit because the improvements in efficiency lead 
to lower prices.''); see also Heartland Energy Servs., Inc., 68 FERC 
] 61,223 (1994) (reviewing early Commission decisions granting 
market-based rate authority).
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    3. National policy fostered further market evolution by encouraging 
increased competition among generators through the Energy Policy Act of 
1992 (EPAct 1992).\5\ Specifically, EPAct 1992 eased regulatory 
restrictions so that independent and affiliate generators could more 
easily enter, and compete in, wholesale electricity markets. EPAct 1992 
also expanded the Commission's authority to address undue 
discrimination in transmission access in order to promote wholesale 
competition. In subsequent orders, the Commission found that the 
availability of transmission service enhances competition in power 
markets, by increasing power supply options of buyers and power sales 
options of sellers, and leads to lower rates for consumers.\6\ By the 
mid-1990s, the Commission had determined that additional measures were 
needed to address undue discrimination in transmission access and 
issued Order Nos. 888\7\ and 889,\8\ which required ``open access'' 
transmission service. In doing so, the Commission explained that its 
action ``remove[s] impediments to competition in the wholesale power 
marketplace and * * * bring[s] more efficient, lower cost power to the 
Nation's electricity customers.'' \9\ The Commission subsequently 
issued Order No. 890,\10\ to further remedy undue discrimination and 
thereby remove barriers to competition.
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    \5\ Pub. L. No. 102-486, 106 Stat. 2776 (1992).
    \6\ Fla. Mun. Power Agency v. Fla. Power & Light Co., 65 FERC ] 
61,125, at 61,615, reh'g dismissed, 65 FERC ] 61,372 (1993), final 
order, 67 FERC ] 61,167 (1994), order on reh'g, 74 FERC ] 61,006 
(1996).
    \7\ Promoting Wholesale Competition Through Open Access Non-
Discriminatory Transmission Services by Public Utilities; Recovery 
of Stranded Costs by Public Utilities and Transmitting Utilities, 
Order No. 888, FERC Stats. & Regs. ] 31,036 (1996), order on reh'g, 
Order No. 888-A, FERC Stats. & Regs. ] 31,048, order on reh'g, Order 
No. 888-B, 81 FERC ] 61,248 (1997), order on reh'g, Order No. 888-C, 
82 FERC ] 61,046 (1998), aff'd in relevant part sub nom. 
Transmission Access Policy Study Group v. FERC, 225 F.3d 667 (D.C. 
Cir. 2000), aff'd sub nom. New York v. FERC, 535 U.S. 1 (2002).
    \8\ Open Access Same-Time Information System and Standards of 
Conduct, Order No. 889, FERC Stats. & Regs. ] 31,035 (1996), order 
on reh'g, Order No. 889-A, FERC Stats. & Regs. ] 31,049, reh'g 
denied, Order No. 889-B, 81 FERC ] 61,253 (1997).
    \9\ Order No. 888, FERC Stats. & Regs. ] 31,036 at 31,634.
    \10\ Preventing Undue Discrimination and Preference in 
Transmission Service, Order No. 890, FERC Stats. & Regs. ] 31,241, 
order on reh'g, Order No. 890-A, FERC Stats. & Regs. ] 31,261 
(2007), order on reh'g, Order No. 890-B, 123 FERC ] 61,299 (2008), 
order on reh'g, Order No. 890-C, 126 FERC ] 61,228 (2009), order on 
clarification, Order No. 890-D, 129 FERC ] 61,126 (2009).
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    4. In addition to addressing undue discrimination in transmission 
access, Order No. 888 encouraged the formation of ISOs. The Commission 
posited that ``ISOs have great potential to assist us and the industry 
to help provide regional efficiencies, to facilitate economically 
efficient pricing, and, especially in the context of power pools, to 
remedy undue discrimination and mitigate market power.'' \11\ To 
facilitate ISO formation and foster independent operation of the 
transmission grid, the Commission suggested that utilities should 
voluntarily transfer operating control of their transmission facilities 
to an ISO. Four years later, in Order No. 2000,\12\ the Commission 
encouraged the voluntary formation of RTOs to administer the 
transmission grid on a regional basis. To date, the Commission has 
approved six RTOs and ISOs: PJM Interconnection, L.L.C. (PJM); New York 
Independent System Operator, Inc. (NYISO); Midwest Independent 
Transmission System Operator, Inc. (Midwest ISO); ISO New England Inc. 
(ISO-NE); California Independent System Operator Corporation (CAISO); 
and Southwest Power Pool, Inc. (SPP). Together, these six RTOs and ISOs 
serve more than half of the United States' wholesale electricity 
demand.\13\
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    \11\ Order No. 888, FERC Stats. & Regs. ] 31,036 at 31,652; see 
also id. at 31,730-32.
    \12\ Regional Transmission Organizations, Order No. 2000, 65 FR 
809 (Jan. 6, 2000), FERC Stats. & Regs. ] 31,089 (1999), order on 
reh'g, Order No. 2000-A, FERC Stats. & Regs. ] 31,092 (2000), aff'd 
sub nom. Pub. Util. Dist. No. 1 of Snohomish County, Washington v. 
FERC, 272 F.3d 607 (D.C. Cir. 2001).
    \13\ See ISO/RTO Council, Progress of Organized Wholesale 
Electriciy Markets in North America 1 (2007), http://www.isorto.org/
atf/cf/%7B5B4E85C6-7EAC-40A0-8DC3-003829518EBD%7D/IRC_State_of_
the_Markets_Report_103007.pdf.
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    5. The wholesale electricity markets operated by Commission-
approved RTOs/ISOs have evolved since their inception and will likely 
continue to do so as advances in technology usher in additional 
competing resources, computational efficiencies, new products, and new 
types of market participants. Today, for example, market participants 
include independent generating resources, storage devices, demand 
response and energy efficiency providers, marketers and traders, 
vertically integrated utilities, power marketing administrations, 
municipalities and cooperatives, among others.
    6. Substantial changes also have occurred with respect to the 
manner in which electricity is bought and sold. For example, when the 
IntercontinentalExchange (ICE) was established in 2000, the vast 
majority of electricity sales transacted on ICE contained requirements 
for physical delivery. Electricity bought or sold without requirements 
for physical delivery is commonly referred to as a financial 
electricity product. Beginning in 2004, the volume of financial 
electricity products bought and sold on ICE eclipsed that of 
electricity bought and sold on ICE with physical delivery requirements. 
The financial electricity product volumes on ICE also surpassed 
electricity volumes reported to the Commission through Electric 
Quarterly

[[Page 66213]]

Reports (EQR) in several markets.\14\ Given that financial electricity 
products commonly settle using published prices from Commission-
jurisdictional markets, changes in the prices of physical electricity 
products impact the values of both physical and financial electricity 
products.
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    \14\ See Federal Energy Regulatory Commission, 2008 State of the 
Markets Report (2009), available at http://www.ferc.gov/market-
oversight/st-mkt-ovr/2008-som-final.pdf. We also note that financial 
electricity products may be transacted (1) Through exchanges besides 
ICE (e.g., NYMEX and Nodal Exchange), (2) by voice brokers, (3) 
bilaterally, or (4) by using other means.
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    7. Recognizing the importance of information relating to market 
trading and market oversight, the Commission issued Order No. 2001 \15\ 
and Order No. 697,\16\ establishing reporting requirements for entities 
selling under market-based rates. As one keen observer stated, in this 
regard, ``[i]nformation is the key to a viable electricity market and 
to preventing market manipulation.'' \17\ In addition, the Energy 
Policy Act of 2005 (EPAct 2005) \18\ gave the Commission expanded 
authority to address market manipulation,\19\ including the ability to 
assess civil fines and seek criminal penalties.\20\
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    \15\ Revised Public Utility Filing Requirements, Order No. 2001, 
FERC Stats. & Regs. ] 31,127, reh'g denied, Order No. 2001-A, 100 
FERC ] 61,074, reh'g denied, Order No. 2001-B, 100 FERC ] 61,342, 
order directing filing, Order No. 2001-C, 101 FERC ] 61,314 (2002), 
order directing filing, Order No. 2001-D, 102 FERC ] 61,334, order 
refining filing requirements, Order No. 2001-E, 105 FERC ] 61,352 
(2003), order on clarification, Order No. 2001-F, 106 FERC ] 61,060 
(2004), order revising filing requirements, Order No. 2001-G, 120 
FERC ] 61,270, order on reh'g and clarification, Order No. 2001-H, 
121 FERC ] 61,289 (2007), order revising filing requirements, Order 
No. 2001-I, FERC Stats. & Regs. ] 31,282 (2008).
    \16\ Market-Based Rates for Wholesale Sales of Electric Energy, 
Capacity and Ancillary Services by Public Utilities, Order No. 697, 
FERC Stats. & Regs. ] 31,252, clarified, 121 FERC ] 61,260 (2007), 
order on reh'g, Order No. 697-A, FERC Stats. & Regs. ] 31,268, 
clarified, 124 FERC ] 61,055, order on reh'g, Order No. 697-B, FERC 
Stats. & Regs. ] 31,285 (2008), order on reh'g, Order No. 697-C, 
FERC Stats. & Regs. ] 31,291 (2009), order on reh'g, Order No. 697-
D, FERC Stats. & Regs. ] 31,305 (2010), aff'd sub nom. Montana 
Consumer Counsel v. FERC, No. 08-71827, 2011 U.S. App. LEXIS 20724 
(9th Cir. Oct. 13, 2011). In its decision upholding Order No. 697, 
the Ninth Circuit Court of Appeals noted that monitoring must be 
accompanied by enforcement because ``[w]ithout enforcement, there is 
little reason to believe that sellers will police themselves.'' 
Montana Consumer Counsel, 2011 U.S. App. LEXIS 20724 at *19 n.5.
    \17\ Charles H. Koch, Jr., Collaborative Governance: Lessons for 
Europe from U.S. Electricity Restructuring, 61 Admin. L. Rev. 71, 97 
(2009).
    \18\ Public Law No. 109-58, 119 Stat. 594 (2005).
    \19\ See, e.g., 16 U.S.C. 824v.
    \20\ See 16 U.S.C. 825o (criminal penalties); 16 U.S.C. 825o-1 
(civil fines).
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    8. Independent market monitoring by RTO/ISO market monitoring units 
(MMU) is an important means to evaluate market developments and to 
identify and deter market abuses and manipulation. In Order No. 2000, 
the Commission identified market monitoring as a basic function of an 
RTO.\21\ The Commission refined its approach to MMUs in a 2005 policy 
statement and in Order No. 719.\22\ In the 2005 Policy Statement, the 
Commission outlined tasks for MMUs to perform in order to enhance the 
competitive structure of RTO/ISO markets.\23\ Subsequently, in Order 
No. 719, the Commission further clarified requirements for MMU 
functions, independence, and information sharing.\24\
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    \21\ Prior to this first generic consideration of MMUs in Order 
No. 2000, the Commission addressed market monitoring in connection 
with individual RTO/ISO proposals. See Pac. Gas & Elec. Co., 77 FERC 
] 61,265 (1996), order on reh'g, 81 FERC ] 61,122 (1997), order on 
clarification, 83 FERC ] 61,033 (1998) (requiring the ISO to file a 
detailed monitoring plan and listing minimum elements for such a 
plan); Pennsylvania-New Jersey-Maryland Interconnection, 81 FERC ] 
61,257 (1997) (requiring PJM Interconnection, L.L.C. to develop a 
market monitoring program to evaluate market power and market design 
flaws).
    \22\ Market Monitoring Units in Regional Transmission 
Organizations and Independent System Operators, 111 FERC ] 61,267 
(2005) (2005 Policy Statement); Wholesale Competition in Regions 
with Organized Electric Markets, Order No. 719, FERC Stats. & Regs. 
] 31,281 (2008), order on reh'g, Order No. 719-A, FERC Stats. & 
Regs. ] 31,292 (2009), order on reh'g, Order No. 719-B, 129 FERC ] 
61,252 (2009).
    \23\ 2005 Policy Statement, 111 FERC ] 61,267 at P 2.
    \24\ Specifically, MMU functions consist of evaluating existing 
and proposed market rules, tariff provisions, and market design 
elements and recommending changes, if applicable; reviewing and 
reporting on the performance of wholesale markets; and identifying 
and notifying the Commission of behavior that may require 
investigation. See Order No. 719, FERC Stats. & Regs. ] 31,281 at P 
354.
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    9. The Commission has acknowledged that MMUs perform a vital and 
necessary function in market oversight \25\ but that they do not 
supplant the Commission's authority.\26\ Rather, MMUs are designed to 
provide the Commission with an additional means of detecting market 
power abuses, market design flaws, and opportunities for improvements 
in market efficiency.\27\
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    \25\ See, e.g., Order No. 719, FERC Stats. & Regs. ] 31,281 at P 
314.
    \26\ Order No. 2000, FERC Stats. & Regs. ] 31,089 at 31,156-57.
    \27\ Id.
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II. Discussion

    10. In this NOPR, the Commission proposes to revise its regulations 
to require each RTO and ISO to electronically deliver to the 
Commission, on an ongoing, non-public basis, data related to the 
markets that it administers; namely, data relating to physical and 
virtual offers and bids, market awards, resource outputs, marginal cost 
estimates, shift factors, FTRs, internal bilateral contracts, and 
interchange pricing. To facilitate such ongoing, electronic delivery, 
the Commission proposes that each RTO and ISO use automated electronic 
procedures to provide this data.
    11. The Commission is statutorily obligated to ensure that sales of 
electricity in wholesale markets are made at just and reasonable 
rates,\28\ and to address market manipulation in connection with the 
purchase or sale of electricity subject to the Commission's 
jurisdiction.\29\ Toward that end, section 301(b) of the FPA provides 
that the Commission shall at all times have access to and the right to 
inspect and examine all accounts and records of public utilities.\30\ 
In this NOPR, and pursuant to its authority under section 301(b), the 
Commission proposes to seek ongoing electronic delivery of data 
including accounts and records of the RTOs/ISOs, which are public 
utilities.
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    \28\ See 16 U.S.C. 824d, 824e.
    \29\ See 16 U.S.C. 824v.
    \30\ 16 U.S.C. 825(b).
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    12. Moreover, the Commission also has authority pursuant to section 
307(a) of the FPA to investigate any facts, conditions, practices, or 
matters it may deem necessary or proper to determine whether any 
person, electric utility, transmitting utility, or other entity may 
have violated or might violate the FPA or the Commission's regulations, 
or to aid in the enforcement of the FPA or the Commission regulations, 
or to obtain information about wholesale power sales or the 
transmission of power in interstate commerce.\31\
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    \31\ 16 U.S.C. 825f(a).
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    13. As markets continue to evolve with increased levels of 
sophistication, the Commission must continue to evaluate the type of 
data necessary to ensure just and reasonable rates. The Commission's 
market monitoring and surveillance capabilities and associated data 
requirements must keep pace with market developments and evolve along 
with the markets. Further, the Commission's evaluation of the market 
rules, regulations, and policies should be informed by the data 
collection proposed herein. Electronic delivery of the types of data 
proposed herein will help to bring the Commission's access to RTO/ISO 
data in sync with the types and levels of activity in those markets and 
help to ensure that rates are just and reasonable.
    14. Most of the data discussed in this NOPR are already collected 
and stored by the RTOs/ISOs in order to administer

[[Page 66214]]

their markets. To the extent that an RTO/ISO does not already collect 
specific data, the Commission is not proposing to require either the 
collection of such data from market participants or its electronic 
delivery to the Commission. The Commission also proposes that key 
identifiers and other descriptive details necessary to understand the 
data be included in the data electronically delivered to the 
Commission. Finally, the Commission proposes that each RTO/ISO 
electronically deliver the data to the Commission using a common 
transfer method and format (i.e., Secure File Transfer Protocol and 
XML), which are described below. The Commission is not proposing that 
each RTO/ISO aggregate or materially modify the data prior to 
electronic delivery to the Commission.\32\
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    \32\ The Commission is currently considering providing an XML 
Schema Definition (XSD) that describes the structure of the XML 
document to be electronically delivered to the Commission. XSD 
defines those elements, attributes, data types, and any default or 
fixed values in the XML. Depending on how the requested data is 
stored by each RTO/ISO, some data transformation may be required to 
prepare XML that is consistent with the XSD. For example, one RTO/
ISO might store dates in MM-DD-YYYY format while the rest use YYYY-
MM-DD format. As such, an XSD might specify that dates in the XML be 
electronically delivered to the Commission in YYYY-MM-DD format.
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    15. This NOPR proposes to require an automated data delivery 
process, in part, to minimize any burden on RTOs/ISOs. The Commission 
currently can request this data from individual RTOs and ISOs on an ad 
hoc basis. Such recurrent, periodic data requests may require more 
Commission and RTO/ISO resources than the proposed electronic delivery 
of this data using an automated process.
    16. Although the six RTOs/ISOs have developed different wholesale 
electricity market designs, there are many similarities in the data 
that they use to administer these markets. Generally speaking, market 
participants with their own supply resources or with supply resources 
under contract submit energy supply offers indicating the price at 
which they are willing to supply various quantities of energy. Load-
serving entities submit demand bids indicating the price at which they 
are willing to buy various quantities of energy. The supply offers pass 
through market power screens. These screens are used to determine 
whether the resources can affect the market price and whether the 
offers should be mitigated. If an energy supply offer triggers the 
application of mitigation, it is replaced with a mitigated energy 
supply offer. Generally, mitigated energy supply offers are calculated 
using estimated marginal cost data, which approximate generators' costs 
under different conditions.\33\
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    \33\ The estimated marginal cost data the Commission proposes to 
receive through this NOPR do not include individual generators' 
actual costs, revenues, or profits.
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    17. Similar to the process for submitting energy offers and bids, 
market participants with their own supply resources or with supply 
resources under contract also submit offers to provide ancillary 
services and capacity services.\34\ These offers typically indicate a 
price at which a market participant is willing to provide the service 
and, like the energy supply offers discussed above, are subject to 
mitigation when appropriate.
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    \34\ We note that currently CAISO and SPP do not administer a 
centralized capacity market.
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    18. Entities with or without physical assets or load obligations 
may also submit ``virtual'' supply offers and demand bids in the RTO/
ISO day-ahead markets. These virtual offers and bids contribute to 
price formation in RTO/ISO markets. Further, entities located outside 
of the RTO/ISO footprint may submit supply offers and demand bids in 
the form of interchange offers and bids.
    19. The RTOs/ISOs match the above-described inputs through an 
intricate process designed to use the lowest-cost resources to meet 
demand.\35\ This process yields pricing signals through locational 
marginal pricing (LMP) that determine which supply offers and demand 
bids are selected (and which would also inform long-term planning, 
e.g., decisions on whether to enter and exit markets). Supply offers 
that are selected are required to provide a specific amount of service. 
For example, resources that are selected in the day-ahead energy market 
will be given an energy market award that specifies the amount of 
energy a particular resource is financially obligated to supply. These 
market awards are determined by each resource's supply offer and the 
corresponding day-ahead LMP. Finally, the RTO/ISO provides dispatch 
instructions for resources in real time. Real-time compensation is 
determined by the dispatch instructions, metered output, and the 
corresponding LMP.
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    \35\ We note that other inputs, including generation 
capabilities and other system costs, inter alia, are used by RTOs/
ISOs to arrive at the lowest-cost solution.
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    20. LMP is comprised of three components: The system-wide price of 
energy, transmission line losses, and the congestion charge. The 
congestion charge component of LMP is calculated using shift factors 
when modeled flows are above the intended physical capability of given 
transmission facilities. A shift factor reflects the positive or 
negative percentage effect that a one-megawatt change in generation 
output or demand will have on an identified constraint. These shift 
factors are used to create a dispatch strategy that is consistent with 
physical and other reliability constraints. In other words, shift 
factors allow RTOs/ISOs to manage transmission constraints through 
congestion charge price signals that relate to a generator's or load's 
influence on a specific constraint.
    21. Prices in the RTO/ISO day-ahead markets and real-time balancing 
markets can be volatile depending on market conditions. Products 
designed to hedge RTO/ISO price volatility have provided valuable tools 
for RTO/ISO market participants to secure predictable revenue streams 
or reduce price risk associated with generation costs. These price 
hedging tools have evolved concurrently with changes in wholesale 
electricity markets.
    22. In the RTO/ISO markets, market participants can limit price 
risk using several tools, notably, virtual offers and bids, FTRs, and 
internal bilateral contracts. Virtual offers and bids (collectively, 
virtuals) allow market participants the opportunity, among other 
things, to transfer price risk between day-ahead and real-time markets 
within an RTO/ISO. When virtuals are scheduled in the day-ahead market, 
the financial commitment is established at published day-ahead prices, 
and virtuals are automatically liquidated with the opposite buy/sell 
position, in most cases at real-time prices. Virtuals are not backed by 
physical assets. If a load-serving entity determines that it might need 
to purchase supply from real-time markets,\36\ the load-serving entity 
could use virtuals to ``lock-in'' a day-ahead price.
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    \36\ A load-serving entity might determine such a need to 
purchase supply, for example, because of potential weather-related 
events or generator malfunction.
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    23. FTRs provide market participants with a mechanism to hedge 
transmission costs under LMP-based market designs. In general, load-
serving entities in RTOs/ISOs are allocated either FTRs or transmission 
rights convertible into FTRs. This allocation is often based on usage 
during an historical period. Allocated FTRs are limited to load-serving 
entities and to those who funded construction of specific transmission 
facilities. Other FTRs are auctioned, and such FTRs generally can be 
purchased by creditworthy entities. Moreover, FTRs

[[Page 66215]]

can be resold outside of the RTO/ISO auction and allocation procedures. 
Transactions occurring outside of the RTO/ISO allocation and auction 
procedures are commonly referred to as secondary market transactions.
    24. Finally, internal bilateral contracts allow market participants 
to hedge energy costs under LMP-based market designs. In RTOs/ISOs, 
market participants can enter into bilateral agreements and use the 
RTO/ISO to perform settlement functions. These internal bilateral 
contracts typically rely on a bilaterally negotiated price rather than 
the potentially more volatile RTO/ISO LMP-based energy price, and they 
allow market participants the opportunity to transfer risks relating to 
energy costs among market participants. Thus, a load-serving entity may 
enter into an internal bilateral contract with a supplier to settle its 
energy costs at a predetermined rate rather than at the applicable LMP. 
If the market participant reports this internal bilateral contract to 
the RTO/ISO, the RTO/ISO would then account for this agreement in its 
settlement process.
    25. RTO/ISO price-hedging products have been created outside of the 
RTO/ISO markets as well. Electricity futures were first traded on NYMEX 
in March 1996.\37\ Electricity futures, which are traded on organized 
exchanges, and electricity forwards, which are traded outside of 
organized exchanges, are transactions that typically specify a quantity 
of physical electricity to be delivered at a specific time and place in 
the future at an agreed-upon price.\38\ A generation owner can sell 
output from its facility at a pre-determined price by entering into 
futures or forward transactions even as the RTO/ISO price varies.
---------------------------------------------------------------------------

    \37\ S.J. Deng and S.S. Oren, Electricity derivatives and risk 
management, 31 Energy 940, 943 (2006), available at http://
www.sciencedirect.com.
    \38\ See id. at 942-43.
---------------------------------------------------------------------------

    26. In recent years, other products for hedging RTO/ISO prices have 
developed, such as electricity swaps. Swaps are similar to electricity 
futures and forwards, but swaps are financial transactions that do not 
require physical delivery. Electricity swaps can be bought or sold at a 
given ``fixed'' price and subsequently settle at a ``floating'' 
published daily electricity price; this is typically referred to as a 
``fixed-for-floating'' swap. Swaps can act as a hedge when used 
alongside physical electricity sales, by guaranteeing the generation 
owner an agreed upon price, notwithstanding fluctuation in the 
published electricity price. Specifically, if the published daily 
electricity price is higher than the agreed upon price, the generation 
owner pays the difference to the counter-party to the swap but still 
receives the agreed upon price.\39\ This effectively guarantees a 
predictable revenue stream to the generation owner. RTO/ISO posted 
prices are one of the commonly referenced settlement values used in 
electricity swaps.
---------------------------------------------------------------------------

    \39\ For example, Generator sells to the RTO/ISO at a market-
based rate, which varies according to the market. As a hedge, 
Generator sells a financial swap to Counter-party at $30/MWh. If the 
published electricity price that Generator receives on day one is 
$20/MWh, Counter-party pays Generator the difference, i.e., $10 ($30 
minus $20). Thus, Generator receives the agreed upon price of $30/
MWh. Conversely, if the published electricity price that Generator 
receives on day two is $45/MWh, Generator owes Counter-party the 
difference, i.e., $15 ($45 minus $30). Thus, Generator again 
receives the agreed upon price of $30/MWh.
---------------------------------------------------------------------------

    27. To the extent that any market participant is willing to 
manipulate the market, that market participant would have an incentive 
to manipulate RTO/ISO prices that are used to settle values for 
electricity products, including financial products such as electricity 
swaps. The likelihood of an attempt at market manipulation can be 
reduced if the perceived cost of manipulation exceeds the perceived 
benefit. For example, a market participant may wish to drive up an RTO/
ISO price because that market participant also holds an electricity 
swap that benefits from a higher RTO/ISO price. In that vein, the 
market participant may offer supply into the RTO/ISO market at levels 
above its own marginal costs, driving up an RTO/ISO price by requiring 
a higher-priced unit to be selected. That market participant would 
receive less revenue from the RTO/ISO due to the lost sales opportunity 
from its own higher-priced offer not being selected. However, in this 
example, the market participant may be able to more than offset the 
reduction in revenue through the benefit of its electricity swap 
associated with the higher RTO/ISO price.
    28. Given the history of electricity markets it regulates, the 
Commission expects that such markets will continue to evolve, that new 
physical and financial products will be formed, and that increasingly 
complex manipulative or other anti-competitive strategies may be 
created.

A. Market Monitoring and Surveillance

    29. To keep pace with market developments, the Commission is 
proposing to establish ongoing, electronic delivery of data from each 
RTO and ISO to enhance its market monitoring and surveillance efforts. 
By seeking electronic delivery of the data outlined in this NOPR, the 
Commission does not seek to displace or modify any of the existing 
market monitoring functions performed by MMUs. Nor do we intend our 
proposal to be perceived as an implicit criticism of the MMUs' 
performance. Instead, this data will help the Commission detect anti-
competitive or manipulative behavior, or ineffective market rules, and 
thus help ensure just and reasonable rates.
    30. Among other objectives, the Commission will use the data it 
proposes to receive as part of automated screens and other analyses 
designed to detect attempts to manipulate RTO/ISO pricing for the 
purpose of benefiting products that settle using RTO/ISO pricing and to 
detect abuses involving interchange transactions. Supply offer, demand 
bid, virtual, and FTR data will assist the Commission in understanding 
how market participants are positioning themselves in RTO/ISO markets. 
For example, market participants attempting to move RTO/ISO settlement 
pricing might offer supply into the RTO/ISO market at uncompetitive 
prices. Likewise, market participants could target specific LMP prices 
using virtual offers and bids. Because congestion impacts are often 
spread across many price nodes (and result in many different LMPs) 
through shift factors, these virtual offers and bids need not be placed 
at the specific price node for which a market participant might be 
attempting to move the LMP. Estimated marginal cost and shift factor 
data will enhance the Commission's ability to identify such behavior 
that may be designed to impact RTO/ISO pricing. Moreover, interchange 
pricing data will assist the Commission's efforts to identify anomalous 
or uneconomic electricity interchange schedules; electricity schedules 
between markets that are not consistent with pricing signals could be a 
source of market inefficiency or raise other anti-competitive concerns.
    31. Securing data concerning the markets that the RTOs/ISOs 
administer is part of the Commission's broader effort to enhance its 
market monitoring and surveillance capabilities. Specifically, in a 
recently issued NOPR on Commission access to electronic tag (e-Tag) 
data,\40\ the Commission proposed to make e-Tag data available to the 
Commission to assist in monitoring the market and preventing 
manipulation, among other things. In yet another NOPR, the Commission 
proposed to require additional contract and transaction data from those 
who file

[[Page 66216]]

EQRs and to extend the EQR filing requirements to wholesale market 
participants which fall outside the Commission's FPA section 205 
jurisdiction.\41\ The Commission stated that these proposals would 
strengthen the Commission's ability to identify potential exercises of 
market power or manipulation. We believe that the same is true here.
---------------------------------------------------------------------------

    \40\ Availability of E-Tag Information to Commission Staff, 
Notice of Proposed Rulemaking, FERC Stats. & Regs. ] 32,675 (2011).
    \41\ Electricity Market Transparency Provisions of Section 220 
of The Federal Power Act, Notice of Proposed Rulemaking, FERC Stats. 
& Regs. ] 32,676 (2011).
---------------------------------------------------------------------------

    32. Utilizing the data the Commission proposes to receive in this 
NOPR and the two NOPRs addressed above could greatly enhance the 
Commission's market monitoring and surveillance capabilities. The data 
will permit the Commission to improve its screening of market 
participants for illicit behavior, making such conduct more difficult 
to mask. In addition, the data the Commission proposes to collect in 
these NOPRs could provide a better picture of legitimate market 
activity and lessen the possibility that market monitoring and 
surveillance screens will result in error.

B. Commission Policies and Regulations

    33. In overseeing wholesale electricity markets, the Commission 
evaluates, in response to submissions or on its own motion, existing 
market designs and the effectiveness of market rules. The Commission 
proposes to use RTO/ISO market data to more effectively carry out these 
functions. Electronic delivery of this data will enable the Commission 
to better identify ineffective market rules and better inform 
Commission policies and decision-making, and thus help prevent anti-
competitive behavior and ensure just and reasonable rates.
    34. We believe that electronic delivery of RTO/ISO market data will 
provide the Commission with empirical information that will augment 
ongoing industry outreach in determining the effectiveness of the 
Commission-approved market rules and the efficiency of existing market 
designs in producing just and reasonable rates. Electronic delivery of 
the market data sought would allow the Commission to perform better 
ongoing analysis as markets evolve and new resources begin 
participating in these markets. For example, the market data sought 
should enable the Commission to assess both the scheduling practices of 
renewable resources and how renewable energy schedules compare with 
actual real-time performance. Because of its unique position, the 
Commission will be able to perform such analysis across the RTO/ISO 
markets. This cross-market analysis will enhance the Commission's 
ongoing efforts to assess the performance of different market designs 
and rules.
    35. In seeking electronic delivery of this data, the Commission 
emphasizes that it does not seek to displace existing MMU efforts to 
evaluate market rules and market designs nor is it proposing to modify 
any of the market monitoring functions performed by MMUs. Rather, the 
Commission is seeking to augment the assessments currently being 
performed by MMUs, thus strengthening the Commission's regulatory 
capabilities through the ongoing electronic delivery of RTO/ISO market 
data.

C. Requested Data

    36. As part of this rulemaking, the Commission proposes to require 
ongoing electronic delivery of, the data (e.g., the information to be 
included in the datasets) described below. The Commission invites 
comment on these data requirements:
    1. Supply offers and demand bids for energy and ancillary 
services--The Commission is proposing that RTOs/ISOs provide their data 
on supply offers and demand bids submitted to RTO/ISO markets. This 
dataset would include all offers and bids for energy and ancillary 
services. This dataset would also include offers and bids submitted for 
interchange transactions, as well as those submitted without economic 
consideration, i.e., self schedules.
    2. Virtual offers and bids--The Commission is proposing that RTOs/
ISOs provide their data on virtual supply offers and virtual demand 
bids submitted to RTO/ISO markets.
    3. Energy/ancillary service awards--The Commission is proposing 
that RTOs/ISOs provide their data on market awards for energy and 
ancillary services. This dataset would include the quantity and price 
of all market awards for energy and ancillary services. The dataset 
would also identify resources that are self-scheduled.
    4. Capacity market offers, designations, and prices--For RTOs/ISOs 
with centralized capacity markets, the Commission is proposing to 
require RTOs/ISOs to provide their data on capacity offers as well as 
capacity market outcomes or designations. This dataset would identify 
capacity resources, the amount of procured capacity, and the applicable 
capacity market price.
    5. Resource output--The Commission is proposing that RTOs/ISOs 
provide their data on resource output data used in market settlements. 
This dataset would include details used in market settlements, 
including RTO/ISO dispatch instructions (i.e., the output that a 
dispatched resource is expected to produce in real-time) for energy or 
ancillary services, or whether resources are operating at self-
scheduled output levels, and measured output levels.
    6. Marginal cost estimates--The Commission is proposing that RTOs/
ISOs provide their data on marginal cost estimates; such estimates are 
typically generated for the potential replacement of supply offers in 
market power mitigation procedures. This dataset would include all 
marginal cost estimates that have been developed, and not just those 
estimates that were used to generate mitigated supply offers. The 
Commission is seeking just the resulting marginal cost estimates 
themselves, however, and is not proposing that RTOs/ISOs provide the 
inputs that allow for calculation of those estimates. Further, the 
Commission is not seeking other operating information regarding 
individual generators' actual costs, revenues, or profits.
    7. Day-ahead shift factors--The Commission is proposing that RTOs/
ISOs provide their data on shift factors calculated for use in the day-
ahead market. This would include generation shift factors, which are 
factors to be applied to a generator's expected change in output to 
determine the amount of flow contribution that that change in output 
will impose on an identified transmission facility or flowgate, and 
load shift factors, which are factors to be applied to a load's 
expected change in demand to determine the amount of flow contribution 
that that change in demand will impose on an identified transmission 
facility or flowgate. This dataset would not be limited to binding 
constraints, but should also include all shift factors calculated to 
address non-binding constraints.
    8. FTR data--The Commission is proposing that RTOs/ISOs provide 
their data on FTR transactions that may not be publicly posted in all 
RTO/ISO markets. Specifically, the Commission is proposing that RTOs/
ISOs provide data detailing how all FTRs and allocated rights were 
acquired, either through RTO/ISO allocation or auction procedures; data 
detailing whether the acquired allocation positions were converted from 
positions that collect auction revenue into positions that collect 
congestion revenue; and data detailing secondary market transactions to 
the extent that they are available to the RTO/ISO.
    9. Internal Bilateral Contracts--The Commission is proposing that 
RTOs/ISOs provide their data on the settlement of internal bilateral 
contracts for energy.

[[Page 66217]]

    10. Pricing data for interchange transactions--The Commission is 
proposing that RTOs/ISOs provide their data on pricing information for 
scheduled interchanges. Scheduled interchanges include any transaction 
between two or more Balancing Authority Areas. To enhance the 
Commission's market monitoring and surveillance efforts, the Commission 
is proposing that eTag IDs be included, when applicable, in addition to 
other interchange pricing details and transaction identification.
    37. The data that the Commission is proposing to receive 
electronically in this NOPR are limited to physical and virtual offers 
and bids, market awards, resource outputs, marginal cost estimates, 
shift factors, FTRs, internal bilateral contracts, and interchange 
pricing. These datasets would include descriptive information such as 
market participant names, unique identifiers, pricing points, and other 
information that the Commission considers necessary and appropriate to 
understand and analyze the data described in this NOPR. Markets are not 
static, however, and, as markets continue to evolve, the Commission may 
initiate a new rulemaking process in the future to reassess the data 
necessary for its market monitoring and surveillance efforts and for 
its policy and decision-making needs.
    38. The Commission proposes that RTOs/ISOs be required to 
electronically deliver the data discussed in this NOPR to the 
Commission within seven days after each RTO/ISO creates the datasets in 
a market run or otherwise. For example, day-ahead offers and bids, 
market awards, resource outputs, day-ahead shift factors, internal 
bilateral contracts, and day-ahead interchange pricing data would be 
required to be electronically delivered within seven days after the 
completion of each day-ahead market run. Real-time offers and bids and 
real-time interchange pricing data would be required to be 
electronically delivered within seven days after the completion of each 
real-time market run. For data that are updated less frequently, 
including capacity market results, estimated marginal costs, and FTR 
data, each RTO/ISO would be expected to electronically deliver that 
data within seven days after it is created or updated by the RTO/ISO. 
For the initial delivery of data under this proposal, however, the 
Commission proposes that each RTO/ISO would be required to 
electronically deliver all such data forty-five days after the 
effective date of any final rule in this proceeding. Finally, if the 
RTO/ISO makes later corrections to the data (after they have been 
delivered to the Commission), the RTO/ISO would be expected to 
electronically deliver the corrected data to the Commission within 
seven days after the correction has been made. The Commission invites 
comments with respect to the timeframe in which the data described in 
this NOPR should be electronically delivered to the Commission.
    39. The Commission proposes to locate the requirement to 
electronically deliver this data on an ongoing basis within section 
35.28(g) of our regulations. Further, the Commission proposes to direct 
each RTO/ISO to submit a compliance filing amending its open access 
transmission tariff to reflect this requirement within forty-five days 
after the effective date of any final rule in this proceeding.

D. Data Formatting and Web-Based Delivery

    40. In order to facilitate the Commission's efforts described 
above, the Commission is proposing to require each RTO and ISO to use 
consistent formatting and delivery methods to electronically deliver 
the data described in this NOPR to the Commission. Consistent 
formatting and delivery methods will enable the Commission to develop 
routine data procedures to link RTO/ISO and other market data, thus 
enabling automated analytic techniques.
    41. In regard to data formatting, the Commission is proposing to 
require that any data outlined in this NOPR be in an XML format that is 
consistent for all RTOs/ISOs when electronically delivered to the 
Commission. As stated above, the Commission is not proposing that each 
RTO/ISO materially modify the data prior to electronic delivery to the 
Commission.\42\
---------------------------------------------------------------------------

    \42\ See supra P 14.
---------------------------------------------------------------------------

    42. In Order No. 714,\43\ the Commission adopted XML format for 
entities to use when making tariff related filings, based upon industry 
agreement.\44\ XML is also commonly used by RTOs/ISOs to deliver data 
to market participants through Open Access Same-Time Information 
Systems (OASIS) and other purposes. Data not formatted in XML may also 
be extracted directly from a database into an XML-formatted file using 
automated procedures. However, the Commission also recognizes that XML, 
which was adopted by the industry as the most effective format to use 
when electronically filing tariffs, may not be the preferred format to 
use when electronically delivering RTO/ISO data. Accordingly, we seek 
comment on this issue.
---------------------------------------------------------------------------

    \43\ Electronic Tariff Filings, Order No. 714, 73 FR 57515, FERC 
Stats. & Regs. ] 31,276 (2008).
    \44\ Order No. 714, FERC Stats. & Regs. ] 31,276 at P 30.
---------------------------------------------------------------------------

    43. In regard to the data delivery method, the Commission is 
proposing that each RTO and ISO use a secure data delivery method to 
provide data to the Commission due to the commercially-sensitive nature 
of the market data described in this NOPR. Specifically, the Commission 
is proposing that any RTO/ISO market data be electronically delivered 
using the Secure File Transfer Protocol (SFTP). Delivery by SFTP is 
similar to delivery by File Transfer Protocol or ``FTP,'' a widely-used 
file-sharing protocol; except that all communications transmitted using 
SFTP are encrypted. Access to the server where the data is 
electronically delivered will only be granted to each applicable RTO 
and ISO and to the Commission.
    44. Accordingly, and as part of our consideration of the range of 
possible formats and delivery methods that RTOs/ISOs may use to 
electronically deliver data to the Commission, the Commission invites 
comments with respect to efficient and secure ways to provide the 
Commission with RTO/ISO data. The Commission also invites comment on 
the time and resources that may be needed by RTOs/ISOs for the initial 
implementation and ongoing compliance with the proposed requirements of 
this rule. Finally, the Commission invites comment on whether a phased 
implementation approach should be undertaken, and, if so, what a 
potential phased approach should entail.

E. Non-Public Data

    45. Much of the information that the Commission expects to receive 
in this proposal is, by its nature, commercially-sensitive.\45\ 
Disclosure of such information could result in competitive harm to 
market participants and the market as a whole.\46\ Accordingly, the

[[Page 66218]]

Commission proposes that the data sought in this proceeding is to be 
kept non-public and not be made publicly available,\47\ except as may 
be directed by the Commission, or a court with appropriate 
jurisdiction.\48\
---------------------------------------------------------------------------

    \45\ In the past, the Commission has granted requests for 
privileged or confidential treatment of similar non-public data. 
See, e.g., N.Y. Indep. Sys. Operator, Inc., 131 FERC ] 61,169, at P 
15 (2010) (granting such treatment for data relating to specific 
generator or other equipment details, transmission system 
information, bidding strategies, generator reference levels, 
generator costs, guarantee payments, and the associated relevant 
time periods); see also So. Cal. Edison Co., 135 FERC ] 61,201, at P 
20; Hydrogen Energy Cal. LLC, 135 FERC ] 61,068, at P 25 (2011); 
N.Y. Indep. Sys. Operator, Inc., 130 FERC ] 61,029, at P 3 (2010).
    \46\ Section 301(b) of the FPA, 16 U.S.C. 825(b), provides that 
no member, officer, or employee of the Commission may divulge any 
fact or information that may come to his knowledge during the course 
of examination of books or other accounts, except as may be directed 
by the Commission or by a court.
    \47\ We note that, notwithstanding that the Commission may have 
data available to it, complainants still must bear the burden of 
making a prima facie case; complainants must do more than make 
unsubstantiated allegations. Interstate Power & Light Co. v. ITC 
Midwest, LLC, 135 FERC ] 61,162, at P 18 (2011); see also UNITIL 
Power Corp. v. Pub. Serv. Co. of N.H., 62 FERC P 61,055, at 61,287 
(1993) (``The question we must answer at this stage of the 
proceeding is whether UNITIL has presented sufficient evidence of 
PSNH's costs so that we may assess whether a trial-type, evidentiary 
hearing is warranted.''); Houlton Water Co. v. Me. Pub. Serv. Co., 
55 FERC P 61,037, at 61,110 (1991) (``Maine Public correctly states 
that a customer seeking a section 206 investigation of existing 
rates must provide some basis to question the reasonableness of the 
overall rate level, taking into account changes in all cost 
components and not just [the item being challenged].'').
    \48\ We note that the Freedom of Information Act (FOIA) allows 
persons to file requests to obtain data from the Commission. 
However, commercially-sensitive data, like that described in this 
NOPR, is covered by exemption 4 of FOIA, which protects ``trade 
secrets and commercial or financial information obtained from a 
person [that is] privileged or confidential.'' 5 U.S.C. 552(b)(4) 
(2006), amended by OPEN Government Act of 2007, Pub. L. No. 110-175, 
121 Stat. 2524 (2007); accord 18 CFR 388.107(d).
---------------------------------------------------------------------------

    46. To the extent the data collected pursuant to this rulemaking 
are used, for example, to support proposed market rule changes, the 
analysis relied upon by the Commission will be publicly available 
except that confidential market information and other protected or 
confidential information will remain non-public. Also, the Commission 
may direct its staff to publicly issue a staff report outside of a 
rulemaking proceeding with similar protections for confidential or 
otherwise protected information.

III. Information Collection Statement

    47. The collections of information contained in this proposed rule 
have been submitted to the Office of Management and Budget (OMB) for 
review under section 3507(d) of the Paperwork Reduction Act of 1995, 44 
U.S.C. 3507(d). The Commission solicits comments on the Commission's 
need for this information, whether the information will have practical 
utility, the accuracy of the provided burden estimates, ways to enhance 
the quality, utility, and clarity of the information to be collected, 
and any suggested methods for minimizing respondents' burden, including 
the use of automated information techniques. Respondents subject to the 
filing requirements of this rule will not be penalized for failing to 
respond to these collections of information unless the collections of 
information display a valid OMB Control number.
    48. The proposed rule does not require market participants other 
than the RTOs/ISOs to report information to the Commission.
    49. The Commission's estimated reporting burden related to the 
proposed rule in Docket RM11-17-000 follow.

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                Implementing burden         Annual recurring operating         Average annual burden
                                                         --------------------------------             burden              (implementation cost  averaged
                                                                                         --------------------------------          over 3 yrs.)
   Data collection, proposed FERC-921        Number of                                                                   -------------------------------
                                            respondents     Burden hrs.      Cost per       Burden hrs.      Cost per       Burden hrs.
                                                          per respondent    respondent    per respondent    respondent        for all      Cost for all
                                                                                                                            respondents     respondents
--------------------------------------------------------------------------------------------------------------------------------------------------------
Compliance filing.......................               6               7          $1,750  ..............  ..............              14          $3,500
Web-Based Delivery......................               6           1,040         100,864              40          $3,879           2,320         225,003
                                         ---------------------------------------------------------------------------------------------------------------
    Grand Total, Average Annual                        6  ..............  ..............  ..............  ..............           2,334         228,503
     Estimates..........................
--------------------------------------------------------------------------------------------------------------------------------------------------------

    50. The Commission recognizes that there will be an initial 
implementation burden associated with providing the Commission with 
RTO/ISO data. This includes submitting a compliance filing to the 
Commission, which the Commission estimates as a burden of 7 hours per 
RTO/ISO, and implementing a process to automatically upload data to an 
SFTP site for Commission use (including development, testing and 
production). The Commission estimates a burden of 1040 hours per RTO/
ISO for the development, testing and production of an automated process 
to provide the Commission with the data described in this NOPR. In this 
regard, though, RTO/ISO markets have already developed capabilities 
necessary to handle RTO/ISO data in an automated manner. For instance, 
through their Open Access Same-time Information Systems (OASIS), RTOs/
ISOs already make certain market data publically available in XML 
format using automated procedures. Likewise, some RTOs/ISOs have 
developed procedures similar to those proposed in this NOPR to deliver 
data to their MMUs.
    51. For the recurring effort involved in electronically delivering 
RTO/ISO data to the Commission, the Commission anticipates that the 
additional burden associated with this rule will be minimal. Any 
recurring burden would be associated with addressing updates to RTO/ISO 
data as the data that they process changes and due to occasional errors 
in the data handling or data upload process.

[[Page 66219]]

    Information Collection Costs: The Commission has estimated the cost 
of compliance per RTO/ISO to be $102,614 in the initial year of 
implementation and $3,879 in subsequent years. The Commission expects 
that the compliance filing will be completed by RTO/ISO legal staff and 
has estimated an hourly rate at $250/hour. The Commission estimates 
that a variety of staff, including legal, database administrators and 
IT and information security specialists, will be required to 
electronically deliver to the Commission the RTO/ISO data described in 
this NOPR. The Commission estimated the average hourly cost for this 
task to be $96.98/hour (including legal staff at $250/hour, information 
systems manager at $105.35/hour, database administrator at $55.61/hour, 
and information security analyst at $57.67/hour).\49\
---------------------------------------------------------------------------

    \49\ Hourly average wage is an average and was calculated using 
Bureau of Labor Statistics (BLS), Occupational Employment Statistics 
data for May 2010 (at http://www.bls.gov/oes/) for the database 
administrator and information security analysts. The average hourly 
figure for legal staff and information systems manager is a 
composite from BLS and other resources. The following weightings 
were applied to estimate the average hourly cost: Legal staff (\1/
6\), information systems manager (\1/6\), database administrator 
(\1/3\), and information security analyst (\1/3\).
---------------------------------------------------------------------------

    Title: Proposed FERC-921.\50\.
---------------------------------------------------------------------------

    \50\ OATT compliance filings (like the one-time compliance 
filing here) are normally included under FERC-516 (OMB Control No. 
1902-0096). However, the reporting requirements (including the 
compliance filing) contained in this proposed rule in Docket No. 
RM11-17 will be covered by a proposed FERC-921.
---------------------------------------------------------------------------

    Action: Proposed collection.
    OMB Control No.: To be determined.
    Respondents for this Rulemaking: RTOs and ISOs.
    Frequency of Information: Initial implementation, compliance 
filing, and automated daily updates.
    52. Necessity of Information: As wholesale electricity markets 
continue to develop and evolve, new opportunities arise for anti-
competitive or manipulative behavior. The Commission's market 
monitoring and surveillance capabilities and associated data 
requirements must keep pace with market developments and evolve along 
with the markets. The data discussed in this NOPR will allow the 
Commission to more effectively identify and address such behavior; to 
identify ineffective market rules; to better inform Commission policies 
and regulations; and thus to help ensure just and reasonable rates.
    53. Internal Review: The Commission has made a preliminary 
determination that the proposed revisions are necessary to keep pace 
with ever-changing possibilities for anti-competitive or manipulative 
behavior and to better inform Commission policies and regulations, and 
thus to ensure that rates are just and reasonable. The Commission has 
assured itself, by means of its internal review, that there is 
specific, objective support for the burden estimate associated with the 
information requirements.
    54. Interested persons may obtain information on the reporting 
requirements by contacting the Federal Energy Regulatory Commission, 
Office of the Executive Director, 888 First Street, NE., Washington, DC 
20426 [Attention: Ellen Brown, e-mail: DataClearance@ferc.gov, phone: 
(202) 502-8663, fax: (202) 273-0873].
    55. Comments concerning the information collections proposed in 
this NOPR and the associated burden estimates, should be sent to the 
Commission in this docket and may also be sent to the Office of 
Management and Budget, Office of Information and Regulatory Affairs, 
Washington, DC 20503 [Attention: Desk Officer for the Federal Energy 
Regulatory Commission]. For security reasons, comments should be sent 
by e-mail to OMB at the following e-mail address: oira_
submission@omb.eop.gov. Please reference FERC-921 and the docket number 
of this proposed rulemaking (Docket No. RM11-17-000) in your 
submission.

IV. Environmental Analysis

    56. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\51\ The 
Commission has categorically excluded certain actions from these 
requirements as not having a significant effect on the human 
environment.\52\ The actions proposed here fall within a categorical 
exclusion in the Commission's regulations, i.e., they involve 
information gathering, analysis, and dissemination.\53\ Therefore, 
environmental analysis is unnecessary and has not been performed.
---------------------------------------------------------------------------

    \51\ Regulations Implementing the National Environmental Policy 
Act, Order No. 486, 52 FR 47,897 (Dec. 17, 1987), FERC Stats. & 
Regs. ] 30,783 (1987).
    \52\ 18 CFR 380.4.
    \53\ See 18 CFR 380.4(a)(5).
---------------------------------------------------------------------------

V. Regulatory Flexibility Act Certification

    57. The Regulatory Flexibility Act of 1980 (RFA) \54\ generally 
requires a description and analysis of final rules that will have 
significant economic impact on a substantial number of small entities. 
The RFA mandates consideration of regulatory alternatives that 
accomplish the stated objectives of a rule and that minimize any 
significant economic impact on a substantial number of small entities. 
The Small Business Administration's (SBA) Office of Size Standards is 
responsible for the definition of a small business.\55\ The SBA has 
established a size standard for utilities, stating that a firm is small 
if, including its affiliates, it is primarily engaged in the 
transmission, generation and/or distribution of electric energy for 
sale and its total electric output for the preceding twelve months did 
not exceed four million megawatt hours.\56\ RTOs and ISOs are not small 
entities, and they are the only entities impacted directly by this 
proposed rule.
---------------------------------------------------------------------------

    \54\ 5 U.S.C. 601-612.
    \55\ 13 CFR 121.101.
    \56\ 13 CFR 121.201 (Sector 22, Utilities).
---------------------------------------------------------------------------

    58. CAISO is a nonprofit organization with over 54,000 megawatts of 
capacity and over 25,000 circuit miles of transmission lines.
    59. NYISO is a nonprofit organization that oversees wholesale 
electricity markets serving 19.2 million customers. NYISO manages a 
nearly 11,000-mile network of high-voltage transmission lines.
    60. PJM is comprised of more than 700 members including power 
generators, transmission owners, electricity distributers, power 
marketers, and large industrial customers and serves 13 states and the 
District of Columbia.
    61. SPP is comprised of 63 members serving 6.2 million households 
in nine states and has 48,930 miles of transmission lines.
    62. Midwest ISO is a nonprofit organization with over 145,000 
megawatts of installed generation. Midwest ISO has over 57,600 miles of 
transmission lines and serves 13 states and one Canadian province.
    63. ISO-NE is a regional transmission organization serving six 
states in New England. The system is comprised of more than 8,000 miles 
of high-voltage transmission lines and over 300 generators.
    64. The Commission believes this proposed rule will not have a 
significant economic impact on a substantial number of small entities, 
and therefore no regulatory flexibility analysis is required.

VI. Comment Procedures

    65. The Commission invites interested persons to submit comments on 
the matters and issues proposed in this

[[Page 66220]]

notice to be adopted, including any related matters or alternative 
proposals that commenters may wish to discuss. Comments are due 
December 27, 2011. Comments must refer to Docket No. RM11-17-000, and 
must include the commenter's name, the organization they represent, if 
applicable, and their address.
    66. The Commission encourages comments to be filed electronically 
via the eFiling link on the Commission's Web site at http://
www.ferc.gov. The Commission accepts most standard word processing 
formats. Documents created electronically using word processing 
software should be filed in native applications or print-to-PDF format 
and not in a scanned format. Commenters filing electronically do not 
need to make a paper filing.
    67. Commenters that are not able to file comments electronically 
must send an original copy of their comments to: Federal Energy 
Regulatory Commission, Secretary of the Commission, 888 First Street, 
NE., Washington, DC 20426.
    68. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely as described in the 
Document Availability section below. Commenters on this proposal are 
not required to serve copies of their comments on other commenters.

VII. Document Availability

    69. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through the Commission's Home Page (http://www.ferc.gov) and 
in the Commission's Public Reference Room during normal business hours 
(8:30 a.m. to 5 p.m. Eastern time) at 888 First Street, NE., Room 2A, 
Washington, DC 20426.
    70. From the Commission's Home Page on the Internet, this 
information is available on eLibrary. The full text of this document is 
available on eLibrary both in PDF and Microsoft Word format for 
viewing, printing, and/or downloading. To access this document in 
eLibrary, type the docket number excluding the last three digits of 
this document in the docket number field.
    71. User assistance is available for eLibrary and the Commission's 
Web site during normal business hours from the Commission's Online 
Support at 202-502-6652 (toll free at 1-866-208-3676) or e-mail at 
ferconlinesupport@ferc.gov, or the Public Reference Room at 202-502-
8371, TTY 202-502-8659. E-mail the Public Reference Room at 
public.referenceroom@ferc.gov.

List of Subjects in 18 CFR Part 35

    Electric power rates, Electric utilities, Reporting and 
recordkeeping requirements.

    By direction of the Commission. Commissioner Spitzer is not 
participating.

Nathaniel J. Davis, Sr.,
Deputy Secretary.

    In consideration of the foregoing, the Commission proposes to 
revise Chapter I, Title 18 of the Code of Federal Regulations to read 
as follows:

PART 35--FILING OF RATE SCHEDULES AND TARIFFS

    1. The authority for part 35 continues to read as follows:

    Authority: 16 U.S.C. 791a-825r, 2601-2645; 31 U.S.C. 9701; 42 
U.S.C. 7101-7352.

    2. In Sec.  35.28, paragraphs (g)(4) through (g)(6) are 
redesignated as paragraphs (g)(5) through (g)(7) and a new paragraph 
(g)(4) is added to read as follows:


Sec.  35.28.  Non-discriminatory open access transmission tariff.

* * * * *
    (g) Tariffs and operations of Commission-approved independent 
system operators and regional transmission organizations.
* * * * *
    (4) Electronic delivery of data. Each Commission-approved regional 
transmission organization and independent system operator must 
electronically deliver to the Commission, on an ongoing basis and in a 
form and manner acceptable to the Commission, data related to the 
markets that the regional transmission organization or independent 
system operator administers.
* * * * *
[FR Doc. 2011-27626 Filed 10-25-11; 8:45 am]
BILLING CODE 6717-01-P

