I 

113TH CONGRESS 

1ST SESSION H. R. 1038 

To provide equal treatment for utility special entities using utility operationsrelated swaps, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 11, 2013 

Mr. LAMALFA (for himself, Mr. DENHAM, Mr. LUETKEMEYER, Mr. COSTA, 

and Mr. GARAMENDI) introduced the following bill; which was referred 

to the Committee on Agriculture 

A BILL 

To provide equal treatment for utility special entities using 

utility operations-related swaps, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Public Power Risk 

5 Management Act of 2013’’. 

6 SEC. 2. TRANSACTIONS WITH UTILITY SPECIAL ENTITIES. 

7 Section 1a(49) of the Commodity Exchange Act (7 

8 U.S.C. 1a(49)) is amended by adding at the end the fol9 lowing: 


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1 ‘‘(E) CERTAIN TRANSACTIONS WITH A

2 UTILITY SPECIAL ENTITY.— 

3 ‘‘(i) Transactions in utility operations4 related swaps shall be reported pursuant to 

5 section 4r. 

6 ‘‘(ii) In making a determination to ex7 empt pursuant to subparagraph (D), the 

8 Commission shall treat a utility operations9 related swap entered into with a utility 

10 special entity, as defined in section 

11 4s(h)(2)(D), as if it were entered into with 

12 an entity that is not a special entity, as de13 fined in section 4s(h)(2)(C).’’. 

14 SEC. 3. UTILITY SPECIAL ENTITY DEFINED. 

15 Section 4s(h)(2) of the Commodity Exchange Act (7 

16 U.S.C. 6s(h)(2)) is amended by adding at the end the fol17 lowing: 

18 ‘‘(D) UTILITY SPECIAL ENTITY.—For pur19 poses of this Act, the term ‘utility special enti20 ty’ means a special entity, or any instrumen21 tality, department, or corporation of or estab22 lished by a State or political subdivision of a 

23 State, that— 


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1 ‘‘(i) owns or operates an electric or 

2 natural gas facility or an electric or nat3 ural gas operation; 

4 ‘‘(ii) supplies natural gas and or elec5 tric energy to another utility special entity; 

6 ‘‘(iii) has public service obligations 

7 under Federal, State, or local law or regu8 lation to deliver electric energy or natural 

9 gas service to customers; or 

10 ‘‘(iv) is a Federal power marketing 

11 agency, as defined in section 3 of the Fed12 eral Power Act.’’. 

13 SEC. 4. UTILITY OPERATIONS-RELATED SWAP. 

14 (a) SWAP FURTHER DEFINED.—Section 

15 1a(47)(A)(iii) of the Commodity Exchange Act (7 U.S.C. 

16 1a(47)(A)(iii)) is amended— 

17 (1) by striking ‘‘and’’ at the end of subclause 

18 (XXI); 

19 (2) by adding ‘‘and’’ at the end of subclause 

20 (XXII); and 

21 (3) by adding at the end the following: 

22 ‘‘(XXIII) a utility operations-re23 lated swap;’’. 


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1 (b) UTILITY OPERATIONS-RELATED SWAP DE2 FINED.—Section 1a of such Act (7 U.S.C. 1a) is amended 

3 by adding at the end the following: 

4 ‘‘(52) UTILITY OPERATIONS-RELATED SWAP.— 

5 The term ‘utility operations-related swap’ means a 

6 swap that— 

7 ‘‘(A) is entered into to hedge or mitigate a 

8 commercial risk; 

9 ‘‘(B) is not a contract, agreement, or 

10 transaction based on, derived on, or ref11 erencing— 

12 ‘‘(i) an interest rate, credit, equity, or 

13 currency asset class; or 

14 ‘‘(ii) a metal, agricultural commodity, 

15 or crude oil or gasoline commodity of any 

16 grade, except as used as fuel for electric 

17 energy generation; and 

18 ‘‘(C) is associated with— 

19 ‘‘(i) the generation, production, pur20 chase, or sale of natural gas or electric en21 ergy, the supply of natural gas or electric 

22 energy to a utility, or the delivery of nat23 ural gas or electric energy service to utility 

24 customers; 


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1 ‘‘(ii) all fuel supply for the facilities or 

2 operations of a utility; 

3 ‘‘(iii) compliance with an electric sys4 tem reliability obligation; 

5 ‘‘(iv) compliance with an energy, en6 ergy efficiency, conservation, or renewable 

7 energy or environmental statute, regula8 tion, or government order applicable to a 

9 utility; or 

10 ‘‘(v) any other electric energy or nat11 ural gas swap to which a utility is a 

12 party.’’. 

13 SEC. 5. EFFECTIVE DATE. 

14 The amendments made by this Act take effect as if 

15 enacted on July 21, 2010. 

Æ 


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