FEDERAL ENERGY REGULATORY COMMISSION

Washington, D.C. 20426

In Reply Refer To:

Office of Enforcement 

Docket No. AI14-1-000

February 20, 2014

TO ALL JURISDICTIONAL PUBLIC UTILITIES AND LICENSEES 

Subject: Accounting and Reporting Guidance for New Electric Storage Technologies

In Order No. 784, the Federal Energy Regulatory Commission (FERC or 

Commission) issued a Final Rule revising certain aspects of its current market-based rate 

regulations, ancillary services requirements under the pro forma open-access 

transmission tariff, and accounting and reporting requirements under its Uniform System 

of Accounts (USofA) for public utilities and licensees and forms, statements, and reports, 

contained in FERC Form No. 1, Annual Report of Major Electric Utilities, Licensees and 

Others (Form No. 1), FERC Form No. 1-F, Annual Report for Nonmajor Public Utilities 

and Licensees (Form No. 1-F), and FERC Form No. 3-Q, Quarterly Financial Report of 

Electric Utilities, Licensees, and Natural Gas Companies (Form No. 3-Q, collectively 

FERC Forms).1

 The accounting and reporting revisions in the Final Rule adopted new, 

and revised existing, electric plant accounts and associated Operation and Maintenance 

(O&M) expense accounts, including a purchased power account. In addition, the 

Commission adopted new schedules in the Form Nos. 1 and 1-F and revised existing 

schedules in the FERC Forms. 

The Commission explained in the Final Rule that the newly adopted energy 

storage accounts are necessary to accommodate the increasing availability of new energy 

storage resources for use in public utility operations and to ensure that the activities and 

costs of new energy storage operations are sufficiently transparent to allow effective 

oversight.2

 The Commission also acknowledged that due to software limitations the 

newly adopted and revised schedules in the FERC Forms, that would contain the energy 

storage accounts, will not be available to filers of the forms for use as of the effective 

 

 1 Third-Party Provision of Ancillary Services; Accounting and Financial 

Reporting for New Electric Storage Technologies, Order No. 784, 78 Fed. Reg. 46,178 

(July 30, 2013), FERC Stats. & Regs. ¶ 31,349 (2013) (Final Rule).

2 Final Rule at P5.

20140220-3070 FERC PDF (Unofficial) 02/20/2014
Docket No. AI14-1-000

2

date of the Final Rule.3

 Consequently, the Commission stated that utilities with energy 

storage assets and those that acquire the assets at a later date must continue or begin, as 

appropriate, using the existing schedules in the FERC Forms to report energy storage 

assets pending availability of the new and revised schedules. Furthermore, the 

Commission directed the Chief Accountant to issue interim guidance for utilities to report 

to the Commission the costs of energy storage operations contemplated in the Final Rule 

until the new and revised schedules are available. The following guidance provides the 

appropriate financial reporting and disclosures required for filers with energy storage 

assets and operations that must be implemented until the new and revised schedules in the 

FERC Forms adopted in the Final Rule are available, unless otherwise authorized by the 

Commission. 

Comprehensive disclosure and consistent, comparable accounting for energy 

storage operations are critical facets in the Commission’s and other users’ of the FERC 

Forms ability to transparently review and oversee public utility energy storage operations. 

Because a software platform is not currently available to report data in the new and 

revised form schedules, filers must use the existing accounts to report the cost of energy 

storage assets and operations and must disclose the accounts used and associated costs in 

footnotes to the existing schedules as detailed further below. In addition, filers must 

submit adopted schedule pages 414-416, Energy Storage Operations (Large Plants), and 

419-420, Energy Storage Operations (Small Plants), as part of schedule pages 122-123, 

Notes to Financial Statements, or through the Commission’s eLibrary under this docket 

as detailed further below.

This guidance is for FERC financial accounting and reporting purposes only and is 

without prejudice to the ratemaking practice or treatment that may be afforded the items 

addressed herein.

ACCOUNTING AND REPORTING FOR ENERGY STORAGE OPERATIONS

1. Electric Plant Accounts

Background: In the Final Rule, the Commission adopted new Account 348, Energy 

Storage Equipment-Production, and Account 351, Energy Storage EquipmentTransmission, and revised Account 363, Energy Storage Equipment-Distribution, to 

record the installed cost of energy storage assets based on the function or purpose the 

asset serves. 

 3 Id. at P184.

20140220-3070 FERC PDF (Unofficial) 02/20/2014
Docket No. AI14-1-000

3

Question: How should energy storage costs recorded in the adopted new and revised 

plant accounts be reported within the existing schedules in the FERC Forms? 

Response: The installed cost of energy storage assets must be reported in the existing 

functional plant accounts based on the function or purpose the asset serves. The account 

used and associated cost must be disclosed in a footnote to the account on schedule pages

204-207, Electric Plant in Service. In addition, the filer must include a disclosure (e.g., 

data table) in schedule pages 122-123, Notes to Financial Statements, that identifies the 

account(s) it reports energy storage assets, the installed cost of energy storage assets by 

account, and the applicable energy storage account(s) that the costs would have been 

reported. 

2. Power Purchased Account

Background: In the Final Rule, the Commission adopted Account 555.1, Power 

Purchased for Storage Operations, to report the cost of: (1) power purchased and stored 

for resale; (2) power purchased that will not be resold but instead consumed in operations 

during the provisioning of services; (3) power purchased to sustain a state of charge; and 

(4) power purchased to initially attain a state of charge, with item 4 being capitalized as a 

component cost of initially constructing the asset. 

Question: How should the cost of power purchased for energy storage operations 

recorded in the adopted new power purchase account be reported within the existing 

schedules in the FERC Forms? 

Response: The cost at point of receipt by the utility of electricity purchased for use in 

energy storage operations must be reported in the existing functional operating expense 

account(s) based on the function and purpose of the related asset. The account used and 

associated cost must be disclosed in a footnote to the account on schedule pages 320-323, 

Electric Operations and Maintenance Expenses, and schedule page 324, Electric 

Production, Other Power Supply, Transmission, Regional Market, and Distribution 

Expenses. In addition, the filer must include a disclosure (e.g., data table) in schedule 

pages 122-123, Notes to Financial Statements, that identifies the account(s) that it 

recorded energy storage-related purchased power costs, the associated cost of electricity 

purchased by account, and the applicable energy storage account that the costs would 

have been recorded. 

In existing schedule pages 326-327, Purchased Power (Account 555), megawatt hours 

purchased for energy storage must be reported in column G separate from other power 

20140220-3070 FERC PDF (Unofficial) 02/20/2014
Docket No. AI14-1-000

4

purchased for non-storage operations, and a footnote must be provided disclosing the 

amounts as energy storage-related. In existing schedule page 397, Amounts Included in 

ISO/RTO Settlement Statements, net purchases for energy storage operations must be 

separately reported under Other Items on the schedule, with a description of the item 

(e.g., net purchases for storage) and the account the amounts are reported disclosed in 

column A. In addition, in existing schedule page 401a, Electric Energy Account, 

megawatt hours purchased for energy storage operations must be reported on line 10 with 

other power purchases and the amount related to energy storage operations must be 

disclosed in a footnote. Further, energy stored as of the reporting date of the form must 

be reported in schedule page 401a on line 27 with energy losses and amounts reported on 

the line related to stored energy must be disclosed in a footnote. 

3. Operation and Maintenance Expense Accounts

Background: In the Final Rule, the Commission adopted new Account 548.1, Operation 

of Energy Storage Equipment, and Account 553.1, Maintenance of Energy Storage 

Equipment, to record O&M expenses associated with energy storage plant classified as 

production; Account 562.1, Operation of Energy Storage Equipment, and Account 570.1, 

Maintenance of Energy Storage Equipment, to record O&M expenses associated with 

energy storage plant classified as transmission; and Account 584.1, Operation of Energy 

Storage Equipment, and Account 592.2, Maintenance of Energy Storage Equipment, to 

record O&M expenses associated with energy storage plant classified as distribution, to 

the extent that the existing O&M expense accounts do not adequately support recording 

of the cost. 

Question: How should energy storage O&M expenses recorded in the adopted accounts 

be reported within the existing schedules in the FERC Forms? 

Response: The cost of labor, materials used, and expenses incurred in the operation and 

maintenance of energy storage plant must be reported in the existing functional O&M 

expense account(s) based on the function and purpose of the related asset. The account 

used and associated cost must be disclosed in a footnote to the account on schedule pages 

320-323, Electric Operations and Maintenance Expenses, and schedule page 324, Electric 

Production, Other Power Supply, Transmission, Regional Market, and Distribution 

Expenses. In addition, the filer must include a disclosure (e.g., data table) in schedule 

pages 122-123, Notes to Financial Statements, that identifies the account(s) that it reports 

energy storage-related O&M expenses, the related amounts expensed by account, and the 

applicable energy storage O&M expense account(s) that the costs would have been 

reported. 

20140220-3070 FERC PDF (Unofficial) 02/20/2014
Docket No. AI14-1-000

5

4. Form Nos. 1 and 1-F, Revised Schedule Pages 408-409, Pumped Storage 

Generating Plant Statistics (Large Plants) 

Background: In the Final Rule, the Commission adopted revisions to line 38 of schedule 

pages 408-409, Pumped Storage Generating Plant Statistics (Large Plants), changing the 

description from “Expenses per KWh (line 37/line 9)” to read “Expenses per KWh of 

Generation (line 37/line 9)” and added new line 39, which reads “Expenses per KWh of 

Generation and Pumping (line 37/(line 9 + line 10)).” The revision to line 38 clarifies 

that the calculation provides for reporting the expenses per kilowatt hour of generation. 

The revision to line 38 does not require filers to perform a new calculation or provide 

new previously unreported information on the line. However, adopted line 39 requires 

filers to calculate and report information that was not required prior to adoption of the 

requirement in the Final Rule. 

Question: How should information to be reported on the newly adopted line 39 in 

schedule pages 408-409 be reported within the existing FERC Forms? 

Response: The expenses per kilowatt hour of generation and pumping activities to be 

reported on the newly adopted line 39 must be calculated as directed in the Final Rule 

and disclosed in a footnote to line 38 of existing schedule pages 408-409. 

5. Form Nos. 1 and 1-F, New Schedule Pages 414-416, Energy Storage 

Operations (Large Plants) and Schedule Pages 419-420, Energy Storage 

Operations (Small Plants)

Background: In the Final Rule, the Commission adopted new schedule pages 414-416, 

Energy Storage Operations (Large Plants), and pages 419-420, Energy Storage 

Operations (Small Plants), to provide for reporting operational and statistical information 

on new types of energy storage assets. Filers with energy storage assets having a rated 

capacity of 10,000 kilowatts or more must report operations of the assets on schedule 

pages 414-416, and filers with energy storage assets having a rated capacity of less than 

10,000 kilowatts must report operations of the assets on schedule pages 419-420. 

Question: How should energy storage operational and statistical information to be 

reported in the newly adopted schedule pages 414-416 and 419-420 be submitted to the 

Commission? 

Response: Operational and statistical information to be reported in the newly adopted 

schedule pages 414-416 and 419-420 must be submitted as part of schedule pages 122-

123, Notes to Financial Statements. If filers are unable to submit the required 

20140220-3070 FERC PDF (Unofficial) 02/20/2014
Docket No. AI14-1-000

6

information as part of schedule pages 122-123, they are permitted to submit this 

information through the Commission’s eLibrary system under this docket.4

 The 

information must be formatted and reported as required in the schedules. Filers can copy 

and populate the schedules, which are available on eLibrary in MS Word format in 

Appendix C of the Final Rule, or filers can develop similar schedules using a different 

format (e.g., MS Excel). If the schedules are submitted through eLibrary, the schedules 

are due to be filed on the same date as the Form Nos. 1 and 1-F, on April 18 of each year, 

and must be submitted concomitant with the submittal of the filer’s Form Nos. 1 or 1-F, 

as applicable. In addition, filers must disclose in schedule pages 122-123 that the annual 

financial reports include schedule pages 414-416 and 419-420 separately submitted 

through the Commission’s eLibrary.

The Commission delegated authority to act on this matter to the Director of the 

Office of Enforcement or his designee under 18 C.F.R. § 375.311 (2013). The Director 

has designated this authority to the Chief Accountant. This guidance letter constitutes 

final agency action. Your company may file a request for rehearing with the 

Commission within 30 days of the date of this order under 18 C.F.R. § 385.713 (2013). 

Bryan K. Craig 

Director and Chief Accountant

Division of Audits and Accounting

Office of Enforcement 

 4

 Instructions for e-filing are provided on the Commission’s web site at 

www.ferc.gov/docs-filing/efiling.asp.

20140220-3070 FERC PDF (Unofficial) 02/20/2014
Document Content(s)

Electric Storage Guidance Letter - AI14-1.DOCX........................1-6

20140220-3070 FERC PDF (Unofficial) 02/20/2014