Electricity Restructuring: Action Needed to Address Emerging Gaps in Federal Information Collection
Published: 2003-06-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The ongoing transition (or restructuring) of electricity markets from regulated monopolies to competitive markets is one of the largest single industrial reorganizations in the history of the world. While information is becoming more critical for understanding how well restructuring is working, there are troubling indications that some market participants deliberately misreported information to manipulate prices. GAO was asked to describe (1) the electricity information collected, used, and shared by key federal agencies in meeting their primary responsibilities and (2) the effect of restructuring on these federal agencies' collection, use, and sharing of this information.
section_title: What GAO Found
paragraphs: Federal agencies collect, use, and share a wide variety of electricity-related information to carry out their respective missions. Federal agencies have three principal sources of information: (1) routine formal data collection instruments sent to industry participants to report on operations and other industry-related activities, (2) third parties such as energy news services that package federally collected information as well as collect original information some of which reflects current market conditions, and (3) individual companies under investigation. Agencies use the information that they collect to carry out their respective missions--ranging from Federal Energy Regulatory Commission's (FERC) monitoring of electricity markets to Energy Information Administration's dissemination of information about the electricity sector and Environmental Protection Agency's pollution monitoring. Agencies share electricity-related information through a variety of means, such as using the Internet to distribute published reports and access their databases, interagency meetings, and other means. In addition, most federally collected information is made publicly available, although it is sometimes subject to delayed release or released in aggregated form in order to protect business-sensitive information. Restructuring has substantially changed the collection, use, and sharing of electricity information at some agencies and has exposed gaps in the federal government's collection of this information. Restructuring has affected FERC dramatically by changing how FERC performs its mission of assuring just and reasonable prices and by shifting its focus from periodic review of cost information to monitoring current market conditions. To monitor these conditions, FERC needs to access market information on wholesale transactions; however, no federal agency, including FERC, has access to complete and timely information on electricity markets and market participants, exposing gaps in key information. Such information gaps exist primarily because FERC is limited in its authority to collect information for full and effective market oversight and it lacks specific authority to collect current information which may lead to market participants challenging these collection activities. For example, FERC authority does not generally extend to non-jurisdictional entities such as the power marketing administrations, other non-utilities, and North American Electric Reliability Council. As long as these information gaps persist, FERC will be unable to oversee electricity markets in a comprehensive manner. Restructuring's effects on the sharing of electricity information, coupled with recent national security concerns, have highlighted the sensitive nature of some information that federal agencies collect or need. Because of the importance of having timely, reliable, and complete information, we are recommending that FERC take action to resolve its information gaps. As part of this action, we are recommending that FERC present its findings to the Congress because information-related issues--raised by restructuring--may require Congressional action to ultimately resolve.

section_title: Letter
paragraphs: Industry experts have described the ongoing transition (or restructuring)  of electricity markets from regulated monopolies to competitive markets  as one of the largest single industrial reorganizations in the history of  the world. Proponents of restructuring expect it to lead to a range of  benefits for consumers, including lower prices and a wider array of  retail electricity services than had previously been available. However,  opponents have raised concerns about restructuring in light of recent  events, such as the extremely high electricity prices and market  manipulation during the electricity crisis in California in 2000 and 2001.
In this changing and uncertain environment, accurate information on  electricity trading and pricing is becoming more critical for not only  evaluating the potential benefits and risks of restructuring, but also  monitoring market performance and enforcing market rules. Information  on the cost of electricity, for example, is critical in determining whether  restructuring is achieving lower prices. Information on existing and new  generating plants is critical in determining whether electricity supply will  be sufficient to ensure reliable supplies. In addition, information is critical  to monitor emissions and comply with air quality standards in the future.  While information is becoming more critical for understanding how well  restructuring is working, there are troubling indications that the quality of  some information may be suspect. For example, we recently reported  that participants at a Federal Energy Regulatory Commission (FERC)  conference raised concerns about the quality of price information due to  the low volume of trading activity in some markets and to some market  participants making inaccurate information available to the public.
In response to the growing importance of electricity information and  concerns about its quality, you asked us to describe (1) the electricity  information collected, used, and shared by key federal agencies in meeting  their primary responsibilities and (2) the effect of restructuring on these  federal agencies’ collection, use, and sharing of this information. In  addressing these objectives, we primarily examined the information  activities of FERC and the Energy Information Administration (EIA)  within the Department of Energy (DOE). We focused on FERC because  it bears the main responsibility for monitoring electricity markets, is  undergoing major organizational changes caused by restructuring, and  has faced significant challenges in responding to restructuring, as we have  described in previous reports. We focused on EIA because it is the main  U.S. statistical agency with responsibility for providing data and analysis  covering the energy sector. In addition to FERC and EIA, we examined  electricity-related activities at the Office of Fossil Energy within DOE,  the Environmental Protection Agency (EPA), the Rural Utilities Service  (RUS) at the U.S. Department of Agriculture, the Securities and Exchange  Commission (SEC), the Department of Justice, the Federal Trade  Commission, and the Commodity Futures Trading Commission. Due to  limitations in the time frame for our review, we did not perform a detailed  evaluation of these agencies’ missions to determine whether information  and data available to them was sufficient to meet their responsibilities.
subsections: section_title: Background
paragraphs: The overall transition known as “restructuring” in the electricity industry  reflects a shift from a monopolistic to a more competitive industry. The  electric utility industry was considered one of the nation’s most regulated  industries, with states regulating utilities’ retail or intrastate activities  and the federal government regulating utilities wholesale or interstate  transactions. In the past, electricity service providers enjoyed a natural  monopoly, providing electricity generated by their plants, transmitted  over their power lines, and distributed to their customers. Two key factors  led that monopolistic structure to move toward a more competitive  marketplace. First, new technologies reduced the cost and size of  generating electricity effectively. Currently, there is a preference for  small-scale production facilities that can be brought on-line more quickly  and cheaply with fewer regulatory impediments. Second, federal changes  were made in the industry’s regulation. Specifically, the enactment of  the Public Utility Regulatory Policies Act (PURPA) of 1978 initiated the  process for a transition or restructuring to a freer electric power market  by requiring utilities to buy electricity produced by nonutility producers.  Then in 1992, the Energy Policy Act (EPACT) was enacted and removed  several regulatory barriers to entry into electricity generation and  promoted further competition.
Restructuring is underway for wholesale markets, which involve the  sale of electricity for resale. It is also underway for some retail sales to  end users, which include residential, commercial, industrial, and other  consumers. Federally regulated wholesale power markets already provide  market-based prices. States, however, vary greatly in their response to  restructuring: some states have introduced competition to the retail  markets in their states, others have begun to restructure but then  delayed or suspended these efforts, and others still have taken no steps to  restructure their markets. As the industry adapts to restructuring, many  utilities are facing greater competition from nonutilities and other new  entities such as power marketers. The introduction of competition has  considerably expanded the number and types of business arrangements  involving generation and transmission of electricity. In addition, proposals  for new regulatory structures to oversee the new industry are emerging.
FERC and EIA are the two leading entities for the collection, analysis,  and evaluation of electric power information. FERC collects information  to assure just and reasonable rates on the basis of costs. FERC also  collects and obtains information from other federal and nonfederal  sources to monitor and regulate competitive markets for wholesale  electricity to similarly determine if these prices are just and reasonable.  EIA is mandated to collect, assemble, evaluate, analyze, and disseminate  energy data and energy information for the Congress, the federal  government, the states, and the public.
The Federal Power Act (FPA) of 1935, PURPA, and EPACT drive  FERC’s information collection activities. FPA authorizes FERC to collect  and record information to the extent it deems necessary and to prescribe  rules and regulations concerning accounts, records, and memoranda.  In general, FPA provides for federal oversight of interstate transmission  and wholesale sales by public utilities. Forty-three years later, the  Congress enacted PURPA in response to the unstable energy climate of  the late 1970s. PURPA authorizes FERC to collect information on the basic  cost and quality of fuels at electric generating plants. FERC uses such  data to conduct fuel reviews and rate investigations and to track market  changes and trends. In addition, PURPA requires public utilities to  report on electric energy shortages and contingency plans to FERC  and appropriate state agencies. In 1992, the Congress enacted EPACT.  EPACT created a new category of power sellers called exempt wholesale  generators that are not subject to regulation under the Public Utility  Holding Company Act (PUHCA), which governs how utilities can  be legally organized. These power sellers must apply to FERC for  PUHCA exemption.
Legislation created EIA and defined its information collection activities.  In 1974, the Congress enacted the Federal Energy Administration Act that  created the Federal Energy Administration. The act mandated the Federal  Energy Administration to collect, assemble, evaluate, and analyze energy  information for the federal government, state governments, and the public  and provided it with information collection enforcement authority for  gathering information from energy producing and consuming firms. Two  years later, the Energy Conservation and Production Act established the  Office of Energy Information and Analysis, mandating it to operate a  comprehensive National Energy Information System; possess expertise  in energy analysis and forecasting; coordinate information activities with  federal agencies; promptly provide upon request any energy information  to any duly established committee of the Congress; and make periodic  reports on the energy situation and trend to the Congress. In 1977, by  enacting the Department of Energy Organization Act, the Congress  established EIA as the federal authority for energy information. This  act gave EIA independence to collect energy data and report energy  information, including all the provisions of its predecessor, and  established an annual survey to gather and report detailed energy  industry financial data. In 1992, EPACT required EIA to expand its data  gathering and analysis in several areas, including energy consumption,  alternative-fueled vehicles, greenhouse gas emissions, fossil fuel  transportation rates and distribution patterns, electricity production from  renewable energy sources, and foreign purchase and imports of uranium.
Federal agencies’ information collection activities are subject to the  Paperwork Reduction Act. The purpose of the Paperwork Reduction  Act is to minimize the paperwork burden for all individuals and entities  that must report information to the federal government. The Office  of Management and Budget (OMB) oversees governmental initiatives  to reduce the paperwork burden and improve the management of  information resources. The Paperwork Reduction Act requires federal  agencies to submit their data collection tools to OMB for review. OMB is  also responsible for the implementation of the Government Paperwork  Elimination Act, which requires federal agencies, by October 21, 2003, to  allow individuals, or entities that interact with the agencies, the option of  submitting information to agencies electronically, whenever practicable.
The North American Electric Reliability Council (NERC) is one of the  most important nonfederal entities that collect data from the electricity  industry. NERC, formed as a result of a devastating outage in the northeast  during November 1965, was established to promote the reliability of the  interconnected electric power system. NERC membership is voluntary,  consists of representatives from utilities across North America, and  provides a forum for the electric utility industry to develop policies,  standards, and guidelines designed to ensure reliability. One of its key  functions is to collect information from its members, among other things,  on power plant operations and outages. NERC reports information in an  aggregated format to protect information its members consider sensitive.
section_title: Agencies Collect, Use, and Share Electricity-Related Information to Meet Missions
paragraphs: Federal agencies collect three types of electricity-related information  for widely varying purposes in accordance with their different  missions. Some agencies such as FERC, EIA, RUS, SEC, and EPA collect  information on an ongoing, regular basis, using forms or form-like surveys.  However, there is a time differential between the reporting period, when  the information is collected and when an agency reports the information.  As a result, the information usually does not reflect current market  conditions. Restructuring has led to a greater need for a second type of  information, focusing on current activities, for purposes of monitoring by  FERC in particular. Third-party sources, such as Bloomberg’s Professional  Services, provide current and historical information on regional electricity  and gas markets, including spot and future prices, market commentary,  plant outage information, and energy news. Investigations create a need  for a third type of information, when an agency such as the Department of  Justice gathers information mainly in conjunction with specific company  criminal investigations. To meet their missions, agencies collect a wide  variety of electricity-related information. FERC and EIA are the primary  gatherers of such information while other agencies, such as the Federal  Trade Commission, have gathered information only for occasional reports.
As shown in figure 1, FERC, DOE’s EIA and Office of Fossil Energy,  RUS, and EPA specifically collect information related to generation,  transmission, and/or distribution functions of electric power. FERC,  EIA, and RUS collect information related to all three of these functions.  In addition, EIA collects end-user information such as residential,  commercial, and industrial usage. Additionally, DOE’s Office of Fossil  Energy is the only office that collects information related to electricity  imports and exports. Finally, EPA collects emissions information related  to the generation of power. The following graphic depicts federal agency  information collections within these functions.
subsections: section_title: FERC Collects Form-Based and Current Information to Oversee Electricity Markets
paragraphs: FERC, an independent regulatory agency, was established in 1977 as a  successor to the Federal Power Commission. In addition to regulating  and overseeing the interstate transmission and interstate wholesale sales  of natural gas and electricity, FERC regulates the interstate transmission  of oil by pipeline; licenses and inspects private, municipal, and state  hydroelectric projects; and approves site choices as well as decisions  to abandon interstate pipelines and related facilities no longer in use.  In responding to this mission, FERC stated that it chooses regulatory  approaches that foster competitive markets whenever possible, assures  access to reliable service at a reasonable price, and gives full and fair  consideration to environmental and community impacts in assessing the  public interest of energy projects. Among its other duties, it reviews the  rates set by the four federal power marketing administrations. FERC  does not have legislative authority over electricity generation siting,  construction of transmission lines, intrastate transmission, or retail sales,  all of which fall under state or local jurisdiction. FERC also has no direct  authority over system reliability—that is, ensuring that consumers can  obtain electricity from the system, when, and in the amount, they want.  Furthermore, FERC’s jurisdiction extends primarily to investor-owned  utilities. FERC generally does not have jurisdiction over federally owned  utilities, publicly owned utilities, or most cooperatively owned utilities.  In 2000, FERC created the Office of Markets, Tariffs, and Rates, which  was until recently responsible for regulating and overseeing competitive  energy markets. In 2002, FERC created the Office of Market Oversight  and Investigation (OMOI), which is still under development, to actively  monitor developing competitive electricity markets.
FERC collects information from the electricity industry, among  other energy industries. According to a 2002 FERC memorandum  regarding current information collections, FERC has 19 information  collection activities that apply specifically to the electricity industry.  This information generally focuses on activities related to generation  and fuel, transmission, energy sales and purchases, consumption and  distribution, and financial information. In addition, it has three other  information collection activities that relate to all three energy industries  (electric, natural gas, and oil pipeline). These collection activities  generally focus on information needed to conduct financial and  compliance audits, preservation of records, and complaint procedures.
Various legislative authorities authorize FERC’s information collection  activities and compliance is mandatory.
The Office of Markets, Tariffs, and Rates uses the information from these  collection activities to provide historical context and assist it in regulating  and overseeing the terms and conditions for energy transactions regulated  under the traditional cost-of-service basis, and more recently, approval of  electricity company mergers. Additionally, other offices, such as the Office  of Administrative Litigation, which is responsible for litigating or resolving  cases set for hearings, use the information as the basis for hearings.  Traditionally, FERC primarily relied on standardized forms to routinely  collect information, authorized by the statute and/or regulation, from  entities within the electric sector. In the past, most of the information for  these forms was submitted on paper, but FERC is currently moving toward  electronic submissions for all of its information collection activities.  FERC also has established reporting requirements where entities must  make specific information available to it; however, these requirements are  reported using a mix of standardized forms or formats. As with the forms,  reporting requirements are submitted on paper and/or electronically.  (See app. I for a summary of FERC’s forms.)
OMOI uses FERC’s traditional information collection activities, mentioned  above, to provide historical context to assist in understanding company  activities and during investigations of specific companies. However,  in light of evolving electricity markets, OMOI also subscribes to both  commercial and proprietary information services to access information  related to current market activities. Such services provide electricity  market information such as prices on the spot market and futures  contracts, plant outage information, and historical trend analysis. OMOI  uses this information to oversee electricity markets and ensure market  participants are not manipulating these markets. (See app. II for FERC’s  third-party sources of current market information.)
section_title: DOE Organizations Use Forms to Gather a Variety of Electricity Information for Analyses, Forecasts, Dissemination, and Other Purposes
paragraphs: Two organizations within DOE are primarily responsible for collecting  electricity-related information. These organizations, EIA and the Office  of Fossil Energy (Fossil Energy), rely on forms to collect an enormous  amount of information at regular intervals. EIA collects this information  for a wide variety of statistical analyses and may assume responsibility  for gathering the lesser amount of information for which Fossil Energy has  been responsible.
EIA is the principal source of comprehensive energy information for  the Congress, the federal government, the states, and the public.  According to EIA’ s strategic plan, its mission is to provide high quality,  policy-independent energy information to meet the requirements of  government, industry, and the public in a manner that promotes sound  policymaking, efficient markets, and public understanding. The plan  further states that EIA’s sole purpose is to provide reliable and unbiased  energy information. To meet its goal of providing high-quality energy  information, the plan states that EIA will provide comprehensive  information (data, analyses, and forecasts) for all energy types  (including electricity), stages (production, conversion, distribution,  supply, consumption, and price) and impacts (technical, economic,  and environmental).
EIA currently uses about 75 different forms to collect information on  all aspects of energy, but only 9 of these forms focus on electricity.  (See app. I for a summary of these forms.) All EIA forms are mandatory,  with the exception of one part of one specific form as noted in the  appendix. Information is collected annually or monthly. For its monthly  surveys, EIA collects information from a sample of electricity entities,  while the full universe is surveyed annually. In commenting specifically  on its electric power information collection program, EIA notes that  its information can be categorized into four broad information  classes: physical systems, operational statistics, financial statistics,  and organizational information. Physical system information provides  the technical specifications for the generators, boilers, pollution control  equipment, and transmission lines that make up the industry. Operational  statistics provide the monthly and annual details of how the physical  plant is operated to satisfy customer demand. Financial statistics consist  of balance sheets, income statements, and supporting account information  to determine the cost of producing electricity and providing related  service. Organizational information describes the basic characteristics of  the entities that comprise the electric power industry, including ownership  and control, affiliations, and identification and geographical information.
EIA and its customers use the information it collects for a variety of  purposes. These include monitoring of market trends in supply, demand,  and prices; analytical activities such as short- and long-term forecasting;  and inputs to special studies, such as responses to congressional inquiries.  EIA is also responsible for making sure its data are available to the public  in easily accessible and user-friendly formats.
Among its other responsibilities, Fossil Energy is responsible for the  federal international electricity program, which consists of two  elements: (1) granting presidential permits for the construction and  operation of electric transmission lines that cross the U.S international  border and (2) authorizing exports of electric energy to foreign countries.  Fossil Energy collects information on electric power imports and  exports from both presidential permit and authorized export holders.  The mandatory information is used in an annual report that summarizes  the electricity trade between the United States and Mexico or Canada  during each calendar year. A Fossil Energy official told us that EIA will  eventually take over the responsibility of collecting information on  imports and exports of electricity.
section_title: EPA Uses a Form-Like Survey to Collect Information on Emissions for Monitoring Air Quality
paragraphs: EPA’s mission requires it to collect electricity-related information for  regulatory purposes. In this regard, one of EPA’s most important  initiatives is its Acid Rain Program implemented in 1995. The program  specifies that all existing utility units serving generators with an output  capacity of greater than 25 megawatts and all new utility units must  report their emissions. The emissions that must be reported include  sulfur dioxide, nitrogen oxide, and carbon dioxide. While not an  emission, the unit heat input (the caloric value of the fuel burned) must  also be reported. The program’s overall goal is to achieve significant  environmental and public health benefits through reductions in emissions  of sulfur dioxide and nitrogen oxide, the primary causes of acid rain. In  most cases, utility units use a continuous emission monitoring system.  Units report hourly emissions information to EPA on a quarterly basis.  The information for the three types of emissions and the unit heat input  is then recorded in the Emissions Tracking System, which serves as a  repository of information on the utility industry. At the end of each  calendar year, EPA uses this information to compare the tons of actual  emissions reported with each company’s authorized emissions. If a  company exceeds its limits, then it will be penalized in accordance  with the rules of the program. The tracking system is EPA’s primary,  electricity-related database used for regulatory purposes. It represents a  significant commitment of personnel with about 40 full-time-equivalent  staff currently assigned to its maintenance and use.
In addition to the three emissions included in the Emissions Tracking  System, EPA has focused particular attention on mercury emitted by  coal-fired electric utilities. An EPA report in February 1998 identified  mercury emissions from coal-fired plants as the toxic air pollutant of  greatest concern for public health from these sources. This report and  collected data were used to call for additional monitoring of mercury  emissions so that a regulatory control strategy could be developed. Then,  in November 1998, the agency announced its decision to require coal-fired  electricity generating plants to collect and report such information for  1 year. The agency collected detailed information on mercury during 1999.  It obtained information on (1) every coal-fired boiler in the United States,  (2) mercury in samples of coal used by boilers, and (3) actual mercury  emissions from the stacks of a randomly selected group of coal-fired  boilers. The information, which was used to estimate 1999 nationwide  and plant-by-plant mercury emissions from coal-fired boilers, confirmed  that coal-fired plants are the largest source of human-caused mercury  emission in the United States—about 43 tons of mercury each year.  Further, in December 2000, the agency announced its decision to propose  regulations to control mercury emissions from coal- and oil-fired plants by  December 2003.
EPA has also developed the Emissions and Generation Resource  Integrated Database, the first complete database of emissions and  resource mix for virtually every power plant and company that generates  electricity in the United States. The Emissions and Generation Resource  Integrated Database does not collect original information but assembles  information already collected by EPA’s Emissions Tracking System,  EPA’s 1999 mercury study, FERC, and several EIA forms. Taking  advantage of previously confidential information on nonutility generators,  the Emissions and Generation Resource Integrated Database reports its  information for all U.S. power plants, including nonutility plants. The  information, which encompasses more than 4,600 power plants and  nearly 2,000 generating companies, is used to provide plant-specific  analyses of emissions. It can also be aggregated at various levels,  for example, individual states and larger regions, to provide more  comprehensive analyses of issues relating to air quality.
section_title: RUS Uses Forms to Collect Information Relating to Its Loans
paragraphs: RUS officials told us that RUS has a different responsibility from other  agencies that also collect information on electricity. RUS is a lending  agency whereas EIA is a statistical agency and FERC and EPA are  regulatory agencies. For this reason, according to these officials, there  are distinct differences in the nature of the information collected. Because  RUS is a lending agency, it seeks information primarily to determine the  financial status of the entities wanting loans. As part of this effort,  officials are interested in obtaining information on the sale and purchase  of electricity and especially in determining whether their borrowers are  buying and selling power from each other.
RUS officials told us that it provided about $4 billion in loans during  2002 and has a total of about $34 billion in outstanding funds plus new  loans. Potential borrowers have to meet RUS’s criteria as serving rural  consumers and also criteria for financial viability. In reviewing new loan  requests for generating plants, these officials use their database to identify  the need for and viability of each new plant. They analyze the ability of the  prospective borrower to function in competitive markets. They told us that  45 percent or more of the electricity sold by rural electricity cooperatives  comes from outside sources and that, almost without exception, they  depend on transmission from outsiders. Some loans to nonprofit  cooperatives are for facilities that may become part of a transmission  system operated by an independent system operator (ISO) or a regional  transmission organization (RTO).
RUS uses two main forms to collect the relevant information. Both forms  state their purpose as being to review an applicant’s financial situation.  These forms collect information about the financial condition, assets, and  operations of rural cooperatives.
section_title: SEC Uses Forms to Collect Information on Companies to Protect Investors
paragraphs: The SEC was established under the Securities Exchange Act of 1934 as an  independent, nonpartisan, quasi-judicial regulatory agency charged with  administering federal securities laws. SEC’s mission is to protect investors  in securities markets that operate fairly and to ensure that investors have  access to all material information concerning publicly traded securities.  SEC also regulates firms engaged in the purchase or sale of securities,  people who provide investment advice, and investment companies. To  promote the disclosure of important information, enforce securities laws,  and protect investors, SEC requires companies under its jurisdiction to  file transactional, periodic, and annual reports using standardized data  collection forms.
SEC was charged with administering PUHCA, which defines a  holding company as any company that directly or indirectly owns,  controls, or holds with power to vote, 10 percent or more of the  outstanding voting securities of a public-utility company. Intrastate  holdings and holdings meeting certain corporate standards may be  exempted from the requirements of the act. Under the act, SEC regulates  public utility holding companies. As of October 31, 2002, there were  18 electricity-and-gas and 7 electricity-only, registered holding companies.  SEC collects information from exempted and registered public utility  holding companies through its general filing requirements and a set of  forms designed with the sole purpose of enforcing the act. The registered  holding companies engaged, through subsidiaries, in the electric utility  business are subject to more rigorous reviews for transactions that  might affect their financial and corporate structure. The collection of  information from such holding companies registered under PUHCA  ensures that SEC has comprehensive information on holding companies  conducting substantial activities in more than one state.
section_title: Other Agencies Have No Ongoing, Regular Collection of Electricity-Related Information
paragraphs: Other agencies, including the Department of Justice, the Federal Trade  Commission, and the Commodity Futures Trading Commission, do not  collect information on an ongoing, regular basis. Both the Department of  Justice and the Federal Trade Commission have responsibilities to enforce  antitrust laws, among others. According to an official in the Department  of Justice’s Antitrust Division, the Division gathers electricity-related  information for an informal investigation that may evolve into a case or a  formal investigation associated with a specific case. The impetus for these  investigations may come from the trade press and other news sources  reviewed by the Department of Justice, a complaining party (a customer or  competitor, for example), a request by FERC, or congressional inquiries.  Referring to the informal type of investigation, the official said that  reviews of the trade press or other news sources sometimes suggest a  potential problem. If a trend emerges, additional general information is  gathered on the issue. This may lead to a finding that there is no further  ground for concern or to the opening of a formal investigation. The official  added that companies are obligated to file information about transactions  related to mergers or acquisitions subject to premerger notification  requirements. If further information is needed to assess the effects of the  transaction on competition, the Department of Justice can make a second  request for more detailed information.
The Federal Trade Commission is also responsible for enforcing a variety  of federal antitrust and consumer protection laws and seeks to ensure  that the nation’s markets function competitively. According to testimony  provided by one of the Federal Trade Commission Commissioners, the  application of federal antitrust laws can help in this transition to  competition by making sure that mergers do not aggravate market power  problems or shield incumbent companies from new competition. A  Federal Trade Commission assistant general counsel stated, however, that  the Federal Trade Commission’s current involvement with electricity  markets is minimal and that it has no ongoing information collection or  standardized forms to obtain information on electricity markets. He also  noted that the agency’s activity was largely confined to two reports and  some comments on other federal and state agencies’ proposed  rulemakings. The first report focused on features of competition in  electricity markets that would benefit consumers, and the second updated  the first with a greater focus on retail competition. In preparing the  second report, the Federal Trade Commission issued a notice seeking  comments and looked at 10 representative states for which information  was obtained from state Web sites and state regulatory commission  personnel. The second report identified “trouble spots” in developing  competitive markets and recommended steps for states to take in  addressing problems. It also identified the barriers for entry into these  markets by new suppliers and the conditions conducive for new suppliers  to enter into these markets, but it did not conclude that such conditions by  themselves would cause new suppliers to not enter the market. With its  reports completed, the Federal Trade Commission has discontinued its  information collection on electricity markets. In addition, the Federal  Trade Commission’s role in reviewing mergers, including those involving  the electricity industry, has declined. The assistant general counsel  commented that the Federal Trade Commission shares with the  Department of Justice and FERC the responsibility for reviewing  information relating to mergers. According to the official, the Federal  Trade Commission’s role in reviewing such information, however, has  decreased because the rate of mergers has diminished recently.
The Commodity Futures Trading Commission, an independent agency  created by the Congress in 1974, regulates commodity futures and option  markets in the United States. The agency protects market participants  against manipulation, abusive trade practices, and fraud. Initially, agency  officials stated that the agency had essentially no role in collecting  information on electricity at present. An agency official said that, for a  period starting in 1996 and ending in 2000, the agency received  information on trading in electricity futures conducted through the New  York Mercantile Exchange, but this trading was discontinued because its  participants found that electricity futures failed to provide an adequate  “hedge” or protection against intermittent price volatility. However,  according to an agency official, the New York Mercantile Exchange has  since introduced several new electricity contracts, and the Commodity  Futures Trading Commission will obtain information on these contracts.  Such information will include, for example, contract details on prices,  trading volume (purchases and sales), and descriptions of large trades.
section_title: Agencies Share Some of the Information They Collect
paragraphs: Restructuring, which has led to increasingly complex market activities  with greater need for oversight, has highlighted the need for sharing  information. Agencies are increasingly using the Internet and a mix of  other methods to enhance their ability to share information with other  agencies and the public.
In the past, agencies provided paper copies of published reports through  their public reference rooms and upon request. However, since the  advent of the Internet, most federal agencies are using it to allow access  to publicly available documents. For example, EIA regularly publishes  reports providing electricity-related statistics and now uses its Web site to  allow easy access to current and past reports. FERC also makes publicly  available information accessible through its Web site using its Federal  Energy Regulatory Records and Information System, which contains over  20 years of documents submitted to and issued by FERC. Despite the  increased use of the Internet, agencies also maintain public reference  rooms where paper copies of documents are made available.
Although federal agencies make extensive amounts of information  available on their Internet Web pages, they share information using  a combination of other methods such as meetings, investigations,  conferences, and workshops. Specifically, a FERC official stated that  FERC currently holds quarterly meetings with the Federal Trade  Commission and the Department of Justice to discuss overlapping  issues, specifically focusing on antitrust and market manipulation  practices. The official added that FERC has met with EIA to coordinate  and share information on information collection issues. Another FERC  official stated that FERC does not have formal protocols to interact with  other agencies such as SEC, the Commodity Futures Trading Commission,  and the Federal Bureau of Investigations; however, FERC also interacts  with these agencies on an ad hoc basis to assist them with their  information needs and use “shared access letters” to request information  from other agencies’ files. For example, FERC staff coordinated closely  with the Department of Justice, SEC, the Commodity Futures Trading  Commission, and the Department of Labor during their investigation  of Enron. Recently, FERC cosponsored a technical conference with the  Commodity Futures Trading Commission to discuss energy market credit  issues and potential solutions to problems and their implementation. Some  agencies, such as Justice and the Federal Trade Commission, use formal  approaches such as interagency agreements and established protocols to  coordinate their work and share information.
section_title: Restructuring Has Exposed Gaps in Agencies’ Electricity Information and Has Affected How This Information Is Shared
paragraphs: Of the eight federal agencies included in our review, we found that  restructuring has significantly affected FERC while other agencies  were affected to a lesser extent. To respond to competitive markets,  FERC has made important changes, for example, creating a new office  to actively monitor markets to ensure they are competitive. These  changes have affected its organizational structure and information  collection activities. However, FERC is limited in the information it is  allowed to collect, primarily because of limitations in its authority. To  diminish gaps in its information, FERC relies on information from  third-party sources, some of which is suspect. Although less affected than  FERC by restructuring, EIA has also made some changes to its information  collection activities. For example, it has increased the number of entities  it reports on and the amount of information collected and changed how it  uses this information. Restructuring has affected other agencies’ collection  of electricity information to a more limited extent but has raised other  issues that affect how they share information.
subsections: section_title: FERC’s Changing Information Needs Have Affected Its Collection and Use of Electricity Information, but Gaps Remain
paragraphs: Over the past year, FERC has changed the way it performs market  oversight from one that reacts to electricity market events to one that  monitors markets on a day-to-day basis. This change has caused FERC to  reassess the information it needs to monitor these markets. During 2002,  FERC created a new office to actively monitor competitive electricity  markets and undertook efforts to identify sources of market information  and better understand its own information needs. Nonetheless, we found  that FERC has gaps in the information it is allowed to collect, primarily  because of limitations in authority. Consequently, FERC has increased its  reliance on information from third-party sources in order to supplement  the information it collects. However, this third-party information also  has gaps, and we question the reliability of some of this information, as  have others. Additionally, FERC plans to have RTOs and ISOs assist it  by monitoring and routinely collecting information on electricity markets,  but the formation of these organizations remains in question.
section_title: FERC Is Reorganizing and Assessing Its Information Needs
paragraphs: In response to the evolving electricity markets, FERC realized that it  needed to reorganize and created OMOI in fiscal year 2002 to monitor  increasingly competitive electricity markets. OMOI’s mission is to  guide the evolution and operation of energy markets to ensure effective  regulation and consumer protection through understanding markets and  their regulation, timely identification and remediation of market problems,  and compliance with FERC rules and regulations.
To carry out its monitoring mission, OMOI uses its Market Monitoring  Center that was patterned after market operation centers or rooms of ISOs  and major energy trading companies. The Market Monitoring Center relies  on computers and various software packages to make large amounts of  information on electricity available in a usable format. The center uses  both commercial and proprietary information services to access current  market activities. Electricity market information provided by these  services includes prices on the spot market and futures contracts,  plant outage, and historical information for trend analysis. FERC also  subscribes to another new service provider that offers current information  on the status and output of some generating units. OMOI also uses the  historical information from the traditional FERC data collection activities  to assist in its work. For example, during investigations, FERC’s forms for  routine information collection provide historical baseline information  that may be critical in determining possible market manipulations and/or  unjustified prices. Appendix II contains information on the commercial  and proprietary information services FERC uses and descriptions of the  types of information provided.
In fiscal year 2002, FERC completed studies to take stock of the  agency’s current and future market information needs. As a part of this  effort, FERC formed teams that were to identify information that FERC  currently collects and additional information that it might need. The study  on current information needs identified 19 active information collection  and reporting requirements for the electric energy sector and three that  relate to all three energy sectors (electric, natural gas, and oil pipeline).  The study on future information needs identified a core body of  information FERC must know to adequately understand how it might  exercise its oversight authority and information needs to accommodate  a range of regulatory approaches. The core body of information includes  eight categories and the specific data elements, descriptions, and potential  sources of this information. The categories are demand for electric power,  supply, operations and congestion management, market participants,  transmission transactional information, market design and rules, and  traditional regulatory functions. FERC’s intention was to make the  information catalogues a “wish list” of every conceivable type of  information FERC might ever want or need.
According to OMOI, it is using the information from these two studies as a  baseline to assess FERC’s overall market information needs. OMOI hired  an energy industry analyst to continue with the information assessment  project. The project’s mission statement focuses on information needs  both in the near term and long term. The near-term objective is to ensure  FERC has the information most necessary to perform its duties in  restructured energy markets.
section_title: FERC Has Information Gaps Primarily because of Limitations in Authority
paragraphs: FERC’s current information collection activities do not provide sufficient  information to fully monitor electricity markets. First, the historical  information FERC collects has deteriorated in quality, in part, because  of declines in power plant information reporting. Specifically, FERC has  found that some of the data fields that companies are required to fill out  are left blank in some cases. To improve data quality, FERC officials stated  that FERC recently improved its error checking capability for one of its  recently developed electronic reports. In addition, some companies have  aggregated sales transactions data on the forms in a way that makes it  impossible to determine specific prices and quantities sold. Further,  FERC’s coverage of power plant operational information has diminished  because some plants formerly owned by utilities are now owned by  nonutilities that are not required to report to FERC. Prior to restructuring,  FERC specifically used the information reported on power plant fuel costs  and quality as a factor to determine electricity rates. Under restructuring,  FERC uses power plant information to understand power production and  available capacity in specific markets, and to understand what is normal  or anomalous. According to FERC, power outages could be used as  strategies to reduce supply and thereby raise market prices. In June 2002,  we reported that California power supplier behavior described in other  studies we reviewed was consistent with the exercise of market power,  because the prices charged did not reflect the marginal costs of generating  additional megawatt-hours of electricity. Rather, the behavior reflected an  ability to charge higher prices by waiting to commit the generation to a  time when buyers were willing to pay more.
Second, according to FERC and as we previously reported, FERC  generally has no jurisdiction over power sales by federally owned  entities, publicly owned utilities, and most cooperatively owned utilities.  These nonjurisdictional utilities own 27 percent of the U.S. electric  transmission system and are also smaller than investor-owned utilities;  however, they serve large areas of the country and provide service in  conjunction with about 25 percent of the nation’s demand for electricity.  FERC officials note that they have little data and information on these  areas of the country. However, according to FERC officials, information  about the operations of these nonjurisdictional entities is important to  understand these entities’ impact on generation and transmission activities  in a given market. For example, the Tennessee Valley Authority operates a  large power system and serves many nonjurisdictional entities covering a  large geographical area across the southeastern United States located  between several FERC jurisdictional entities. According to FERC, the  lack of detailed information about the operations of the Tennessee Valley  Authority system limits its ability to assess the performance of the markets  surrounding this network. Similarly, FERC officials noted that they also  need information on electricity imports from neighboring countries,  particularly Canada, because they participate in and affect prices of  electricity in U.S. markets.
Third, according to FERC officials, they have limited up-to-the-minute  market information needed to monitor electricity markets. FERC does  not collect price information, for example, on up-to-the-minute electricity  prices, fuel costs, and spot and futures contract prices. In June 2002,  we reported that the Market Monitoring Center did not include detailed  information about energy prices on “exempt” commercial markets,  including the Intercontinental Exchange, a “multilateral” electronic  trader, which invites and matches buy and sell orders for other customers.  According to FERC, it now has access to Intercontinental Exchange but  no longer has access to other Internet-based trading systems such as  UBS Warburg and Dynegydirect, both of which were “bilateral”  electronic traders because they have ceased operations. Such systems  have and continue to provide an important market for both physical  energy (electricity and gas products) as well as energy derivatives to be  bought and sold. In commenting on a draft of this report, FERC stated that  because its authority is ambiguous relative to the trade of electricity-based  derivatives, its ability to collect information on this part of the market  is limited. Additionally, FERC officials said that they have limited  operational information, such as power plant outages and availability  of capacity on transmission lines. Price and transaction information, as  well as operational information, is important in order for FERC to be  able to detect changes in the market, determine the legitimacy of market  outcomes, and if needed, take corrective action.
Finally, FERC officials told us that FERC cannot access other nonfederal  information it needs to assess reliability of the power grid and monitor  overall electricity market performance. Specifically, NERC collects  current electricity market information such as operations of power plants,  flows on key transmission lines, transmission between two parties, and  system frequency (that is, a measure of how well the system is balancing  electricity demand and supply and other reliability information). FERC  officials pointed out that because market performance and electricity  system reliability are mutually dependent, such reliability information  would help them to determine whether market participants are behaving  in an anticompetitive manner. While NERC officials agreed that this  information might be valuable to FERC in determining whether power  plant outages are justifiable, they stated that NERC is prohibited from  disseminating such information without obtaining the companies’  permission—which companies are reluctant to grant due to the  business-sensitive nature of the information. Further, NERC officials  told us that their database is deteriorating in quality because companies  are increasingly concerned about sharing detailed information, for fear  that competitors may gain an undue advantage. In particular, many new  market entrants to the electricity generating industry have not joined  NERC or provided NERC with information about their plant operations.  In commenting on a draft of this report, FERC stated that language in  proposed legislation creating FERC jurisdiction over a designated electric  reliability organization should assist in addressing issues related to access  to NERC information.
As we previously reported, FERC lacks authority to gather all the  information it needs from all segments of wholesale electricity markets  primarily because it derives much of its legislative authority from  mandates that were enacted over 75 years ago—when the industry was  structured as regulated monopolies and rates were based on the cost of  service. Further, we reported, FERC lacks regulatory authority over all  entities in wholesale electricity markets and is therefore unable to gather  all of the information it needs to understand markets across the nation.  Specifically, section 309 of the Federal Power Act provides FERC with the  authority to prescribe the forms of all reports to be filed with it and the  information to be reported. This authority does not generally extend to  nonjurisdictional entities such as the power marketing administrations,  other nonutilities, and NERC. For example, FERC has identified problems  in getting data on individual power plant operations that it needs in order  to evaluate the functioning of the transmission system. Information on  nonjurisdictional entities is important because they also participate in the  same electricity markets as jurisdictional entities and directly influence  market activities, including prices. Senior FERC officials told us that, in  general, FERC’s authority to collect information from nonjurisdictional  market participants is predicated on developing a specific legal argument  that the information supports a specific investigation, rather than for  more general monitoring of market performance. Furthermore, regarding  entities within FERC’s jurisdiction, FERC does not have specific authority  to collect up-to-the-minute detailed information on market activities.  While long-standing general authority may enable FERC to collect the  information it needs, the lack of specific authority for obtaining this  information may lead to challenges from market participants. In this  same vein, FERC officials added that FERC also faces challenges  related to the Paperwork Reduction Act in terms of the long lead time  and the level of effort necessary to obtain OMB’s approval for additional  information collections.
Additionally, FERC’s legislative framework does not allow it to levy  a meaningful range of penalties against companies that choose to  intentionally underreport or misreport required information. Although  the Federal Power Act allows FERC to levy criminal fines and civil  penalties against market participants, they are insufficient to discourage  underreporting or misreporting information. Thus, FERC’s traditional  legislative authority may no longer be in sync with today’s developing  competitive electricity markets. In competitive energy markets, adequate  and reliable information is important to FERC’s ability to fulfill its  regulatory mandate and ensure the market participants are not engaging  in anticompetitive behavior. In commenting on a draft of this report,  FERC stated that market transparency provisions in proposed legislation  prohibits the filing of false information and increases FERC’s criminal  penalty authority for noncompliance.
section_title: FERC Increasingly Relies on Third-Party Information, but Gaps Remain and Some Information Is Suspect
paragraphs: FERC increasingly relies on third-party information to help offset its  limited authority to collect all of the information it needs to monitor  electricity markets. OMOI subscribes to several energy-related services  to increase its access to current markets and make key decisions related  to market performance. (See app. II for a complete listing and description  of information that third parties provide to FERC to assist its monitoring  of electricity markets.) While these third-party sources fill some of  FERC’s information gaps, they do not have full or complete coverage  of the information FERC needs but lacks. For example, while Genscape  measures power plant operations for some power plants, it does not have  full coverage of the electricity system. Moreover, OMOI does not have  access to a third-party source for price or quantity information on most  bilateral transactions of wholesale electricity. In addition, FERC and  others have raised concerns about the quality of the published price  information these third parties provide. Specifically, FERC reported  that published prices are subject to manipulation and cannot be  independently validated. FERC surveyed reporting firms for both natural  gas and electricity and found that these firms lacked formal verification  or corroboration and sufficient internal controls to ensure information  reported to them was reliable. FERC also found that these entities relied  instead on traders or bid/ask prices reported by traders and other market  participants. As a result, FERC reported that this lack of verification  allowed an opportunity for entities to deliberately misreport information  in order to manipulate prices and/or volumes in electricity.
In at least one recent instance, FERC used such third-party information  as a basis of a key decision regarding California’s electricity market—the  information, however, later turned out to be inaccurate. Specifically, in  2002, FERC instructed an administrative law judge, who was considering  a request for refunds related to the western electricity crisis, to use a  methodology that relied on third-party data for natural gas prices. The  methodology, developed by FERC staff, was intended to set a proxy for  market prices that would have been produced had the western market  been competitive. The methodology estimated the cost of producing  electricity for key generators based on operating cost, including fuel.  Using this methodology, the judge ordered refunds of about $1.8 billion  to the state of California. Subsequent to the order, FERC found, in  August 2002, that the natural gas prices underlying the methodology had  been subject to erroneous reporting and manipulation. In March 2003,  FERC presented an alternative methodology for determining refunds,  which is expected to substantially increase the previous award.
In commenting on a draft of this report, FERC stated that it is working  on options--based on staff recommendations and through a docket  proceeding--to improve third-party data. FERC added that market  transparency provisions in proposed legislation allow for establishing an  electronic system that provides information about prices in electricity  markets, in addition to the prohibition for filing false information and  increased criminal penalty authority noted in the previous section.
section_title: FERC Plans to Use RTO/ISO Information, but RTO Formation Remains Incomplete
paragraphs: In addition to the third-party information, FERC plans to rely extensively  on RTOs and ISOs to assist in its monitoring efforts. FERC plans to use  the market monitors, created as part of ISOs, to perform up-to-the-minute  market monitoring activities and routinely collect information on their  electricity markets. FERC officials stated that the market monitors have a  better ability to understand and observe market changes, can react more  quickly to changing market conditions, and can take stronger corrective  action than FERC. In addition, as part of the rules sanctioning these  entities, FERC officials said they expect to have access to all the data  collected by the market monitors, which FERC views as considerable.  According to FERC, it currently obtains timely information from some  existing RTO and ISO monitors to help support its market oversight  processes. However, FERC officials said that, relative to the Paperwork  Reduction Act, they are not sure whether the market monitors will be  able to collect information on FERC’s behalf that FERC itself has not  been authorized to collect. In commenting on a draft of this report,  FERC stated that it is mindful of the potential burden imposed by  additional information collections. FERC added that it has been inventive  in developing ways to monitor markets, particularly restructured markets  with RTOs and ISOs, using data generated as an integral part of market  operations.
Further, as we previously reported, several of the market monitors rely on  different methods to evaluate market power, there is a lack of uniformity  in what information is collected, how it is analyzed, and what is reported,  making potential cross-market comparisons difficult at this time. More  importantly, FERC’s effort to expand the number and/or market coverage  of RTOs as well as standardize electricity market rules has met with  resistance from the Congress, state commissions, and others. At present,  according to FERC, two organizations have been approved as RTOs  while five others have been conditionally approved. Overall, even if these  additional RTOs are fully approved, FERC’s coverage will not extend to  markets outside of its jurisdiction. Thus, FERC’s reliance on RTOs to  help it diminish data gaps, particularly in the next several years, will likely  provide only limited help. In commenting on a draft of this report, FERC  believes that market transparency provisions in proposed legislation will  address issues related to jurisdictional entities that do not participate  in RTOs.
section_title: Restructuring Has Affected Other Agencies to a Lesser Extent
paragraphs: Among the other agencies, EIA has been the most affected by  restructuring while the remaining agencies have been affected only  slightly. At EIA, restructuring has led to changes in the number of  entities from which EIA collects data, the volume of data collected on  electricity markets, and the way in which EIA uses the data to complete  its mission of examining the energy sector. EIA officials recognized that  restructuring could affect them and examined the potential implications in  two reports.
According to a senior EIA official, the first, and most important effect of  restructuring on EIA was its revision of its forms to require the same  information from utilities and nonutilities. Historically, nonutilities were  exempt from many of EIA’s reporting requirements. Adding these new  entities has expanded EIA’s database by about 2,000 new sources of  information and has nearly doubled its database. The second effect of  restructuring on EIA is the increase in the volume of information that it  collects and provides because restructuring has significantly expanded the  role of wholesale markets in providing electricity. For example, EIA now  posts electricity prices for several of the largest markets on its Web site  and reports more detailed information about the aggregate activities of  these markets in its publications. The third effect of restructuring on EIA  is to significantly alter the way that EIA examines energy sectors and  electricity in particular. In order to meet one of its missions of examining  and forecasting energy consumption and use, EIA has had to revise its  energy models to accommodate restructuring because of changes in the  way that electricity is supplied and distributed. For example, in March  2003, EIA reported that it reviewed and revised how it collects, estimates,  and reports fuel use for facilities producing electricity. According to EIA,  the review addressed inconsistent reporting of fuels for electric power  by combined heat and power plants and changes in the electric power  marketplace that have been inconsistently represented in various EIA  survey forms and publications. EIA regards these efforts as complex and  substantial and expects them to continue as the electricity sector evolves.
EIA also encountered problems such as maintaining the quality of  information. The Director of EIA’s Electric Power Division said that the  Department of Energy’s Secretary has made the quality of information  one of the department’s top priorities. However, maintaining this quality  at EIA is a challenge because there has been a substantial increase in the  number of sources of information (especially the nonutilities) resulting  from restructuring while EIA has also experienced substantial budget cuts.  The Director estimated that there has been a 50 percent increase in the  overall volume of data. In addition, the Director said that, while omission  of information by companies responding to EIA’s data collection efforts is  not a common problem, in the past, some companies failed to answer a  question about the delivered fuel price on EIA’s Form 423. The Director  added that the companies’ decision not to disclose information about fuel  prices could have been attributed to the sensitive nature of this  particular item.
Restructuring has had little direct effect on SEC’s overall information  collection activities. As such, according to SEC officials, the SEC  continues to carry out its oversight of securities laws and its  administration of PUHCA. However, the Congress is considering  repealing or modifying PUHCA because the emergence of nonutilities  reflects the fact that utilities are no longer the sole source of electricity  energy. FERC and SEC officials acknowledge that since nonutilities are  not covered by PUHCA, registered holding companies may engage in  nonutility activities that are not regulated by the act. SEC has stated that  it supports the repeal of PUHCA as long as repeal is accomplished in a  way that gives FERC and state regulators sufficient authority to protect  utility consumers. FERC has stated that PUHCA, as it currently exists,  may actually impede competitive markets and appropriate competitive  market structures.
Recent events such as the collapse of Enron Corporation have accelerated  reforms affecting SEC that aim at improving the quality and reliability of  financial information. SEC plays a vital role in ensuring that meaningful  and intelligible information is disclosed to investors. Such disclosures are  particularly important as corporate structures of new and old electricity  market participants continue to change. The Sarbanes-Oxley Act of 2002  has established the legal framework to address some of the concerns  related to corporate disclosure, accountability, and transparency.
Restructuring has not had significant effects on the collection of electricity  information by the other agencies included in our review. Some agencies,  such as the Federal Trade Commission and the Commodities Futures  Trading Commission, may become more involved in collecting electricity  information as competitive markets develop. For example, the number  of electricity entity mergers has slowed down, but should these mergers  increase, Justice may need to increase its information collections for  merger investigations accordingly. In addition, a Commodities Futures  Trading Commission official initially told us that electricity futures  trading had been discontinued because the market participants found that  electricity futures failed to provide an adequate hedge against intermittent  price volatility. However, since our initial discussion, the New York  Mercantile Exchange has introduced several new electricity contracts, and  the Commodities Futures Trading Commission has reinstated its practice  of collecting information on these trades.
Despite the more limited impacts of electricity restructuring on many  of these agencies to date, some jurisdictional issues have been raised  about their respective roles in helping to oversee electricity markets more  generally. Events such as the collapse of Enron Corporation bring to light  the importance of clarifying jurisdiction across the federal government  as restructuring progresses. As noted in a recent Senate Governmental  Affairs report and memorandum, and other congressional hearings,  both FERC and SEC have been questioned about their lack of diligence  in following through on Enron’s activities—even though they had  indications of improper conduct. The report commented that effective  coordination between agencies prevents companies from exploiting  the lack of oversight in areas where neither agency may have taken  full responsibility—as Enron did with FERC and SEC in the case of  its investments in wind farms. Officials at both FERC and SEC told us  that they had performed their jobs and had no reason to check with the  other agency about Enron’s actions. However, Enron took advantage of  jurisdictional gaps between the two agencies that enabled it to earn tens  of millions of dollars above what it would have otherwise earned from its  wind farms.
FERC and the Commodity Futures Trading Commission provide a  second example of problems resulting from jurisdictional uncertainties.  The Senate memorandum (noted previously) on FERC pointed out  that FERC did not initially determine whether it had jurisdiction over  on-line trading platforms such as Enron Online, although it was FERC’s  expectation that these electronic trading platforms would become a  dominant way to trade both electricity and gas. Furthermore, this  memorandum concluded that both FERC and the Commodity Futures  Trading Commission had some regulatory responsibility for on-line  trading. Until Enron’s collapse, however, the two agencies did not  participate in meaningful discussions to identify and coordinate their  respective roles. Effective coordination would have helped to clarify the  jurisdictional boundaries between FERC and the Commodity Futures  Trading Commission regarding energy trading activities and products,  including on-line trading, and to define the two agencies’ respective  monitoring responsibilities in these developing markets. Both agencies  have recently taken steps to improve their coordination. Because these  jurisdictional issues remain unresolved, however, it is unclear whether  these problems are limited to a few examples or are potentially  more widespread.
section_title: Changes in Industry Caused by Restructuring and National Security Concerns Have Affected How Information Is Shared
paragraphs: Restructuring has made the issue of confidentiality concerning electricity  information more prominent. On the one hand, the need to access key  information now is greater in evaluating the benefits and risks of  restructuring. On the other hand, the sensitivity of this information,  according to the companies asked to provide it, is also greater because of  fears that other companies could use it to seek competitive advantages.  This dilemma has led to controversy about the electricity information that  is to be made publicly available and shared with other federal agencies.  Both EIA and FERC have procedures regarding restrictions on access  to information and have modified these procedures, as appropriate. For  example, EIA faced considerable protest for its proposal to restrict access  to the information that it collects but updated its procedures to resolve  some of the concerns raised. By contrast, public disclosure laws and  confidentiality pledges to protect information also affect information  sharing and collection of other key information at both federal and  nonfederal levels. For example, NERC’s information collected from  the electricity industry remains unavailable to FERC and other federal  agencies because of its sensitivity. In addition, the quality of the  information being submitted to NERC has declined as companies have  become increasingly concerned about providing it. In addition to the  confidentiality issues, the events of September 11, 2001, have heightened  national security concerns about protecting the nation’s energy.
subsections: section_title: EIA Has Taken Steps to Resolve Confidentiality Issues
paragraphs: In 2001, EIA faced a major controversy over confidentiality of electricity  information, which it was able to resolve. The controversy pitted certain  companies that feared potential competitive harm from the release of  sensitive information, against agency and public interest in maintaining  access to electricity data. Federal agencies and a private sector group  provided extensive comments on EIA’s proposal to broaden the  information it considered confidential. EPA, for example, objected to  EIA’s proposed confidential treatment of fuel consumption, fuel quality,  fuel type, thermal output, and retail sales. EPA officials noted that EPA  makes extensive use of these data elements in monitoring emissions. In  general, it maintained that EIA’s proposal went far beyond what was  reasonably necessary to protect competitors from the release of sensitive  data. The American Public Power Association, which represents the  nation’s 2,000 nonprofit, publicly owned electric utilities, described itself  as “deeply troubled” by EIA’s proposal. It stated that EIA had provided  no evidence that the public availability of specific data items would  harm the filing companies and no evidence on how EIA balanced the  public’s need for information against any potential harm to these  companies. By contrast, the Edison Electric Institute, which represents  shareholder-owned electric companies, cited potential harm to companies,  for example, information in the hands of a competitor that could allow the  competitor unfairly to undercut another company’s bid strategy.
In response to these disagreements over confidentiality, EIA issued a  policy statement that made two general changes to its procedures. First,  it reported that some data elements that were not considered confidential  in the past would now be treated as confidential. Second, it reported that  some data collected from unregulated companies that were formerly  treated as confidential would now be made publicly available. Discussing  the eventual resolution of the controversy, the Director of EIA’s Electric  Power Division told us that EIA adopted two strategies to achieve this  balance. These strategies involve (1) requiring essentially the same  information from all companies, including utilities and nonutilities,  and (2) identifying appropriate time frames for retaining and releasing  sensitive data. The details of the data remaining confidential are presented  in appendix III.
section_title: FERC and Other Nonfederal Sources of Information Face Challenges that Affect Both Information Collection and Sharing
paragraphs: FERC recognizes the need of utilities to compete in the electric market  and understands their desire to keep confidential some of the information  it collects through its forms. However, FERC’s policy requires respondents  who request confidentiality to show that potential harm outweighs the  need for public access to the information. According to FERC, the courts  have, through a considerable body of case law, clearly stated that the  company bears the obligation, in this case the electric utility, to prove  release of information would cause harm. FERC officials told us that  Freedom of Information Act requirements raise concerns among utilities  about FERC’s ability to protect commercially sensitive information. The  act requires FERC to disclose information to the public unless specific  exemption categories are met, which FERC officials told us, is often  difficult to do. According to FERC officials, while FERC may be willing  to share exempted information with state regulatory bodies, states have  similar public disclosure laws that do not always guarantee their ability  to protect this information. FERC officials added that RTOs will also face  similar challenges in sharing commercially sensitive information. While  RTOs could benefit by sharing information about entrants from other  markets who are interested in entering their own markets, protecting the  confidentiality of this information will be an issue. In commenting on a  draft of this report, FERC stated that proposed legislative language  provides a clear confidentiality standard, exempting “from disclosure  information FERC determines would, if disclosed, be detrimental to the  operation of an effective market or jeopardize system security.” Finally,  FERC also faces challenges creating ways to obtain and share information  from Canada and Mexico, since they also affect U.S. electricity markets.
NERC is hesitant to share information with FERC that its members  feel would cause them competitive harm if released in the public  domain. According to a NERC official, companies are increasingly  reluctant to provide commercially sensitive information, causing a  decline in information quality. Therefore, NERC has pledged not to  divulge information on a company-specific basis and will release it only  in aggregate form in hopes of getting the information it needs. NERC  collects current electric market information such as flows on key  transmission lines, transmission between two parties, and system  frequency (an indicator of how well the system is balanced) that  FERC is interested in obtaining from NERC, but, according to both  FERC and NERC officials, confidentiality pledges inhibit this sharing  this information.
section_title: National Security Concerns Affect Information Sharing
paragraphs: Since September 11, 2001, the federal government has taken steps to  protect the nation’s critical infrastructures, including the energy  infrastructure. FERC has taken steps to remove information it considers  to be critical to protecting the nation’s power grid from the public domain.  Specifically, it has removed information such as oversized maps that detail  the specifications of existing and proposed energy facilities that were  once publicly available from its Internet site, public reference rooms, and  databases. For example, FERC removed the information its collects from  the Form 715, Annual Transmission Planning and Evaluation Report,  from the public domain. Additionally, EIA removed power plant latitude  and longitude information from the public domain. While steps have  been taken to better protect information, federal officials at both FERC  and EPA raised concerns about the increasing difficulty of accessing  information on power plant locations and related data.
section_title: Conclusions
paragraphs: Given FERC’s predominant role in overseeing evolving electricity markets,  FERC needs information on a regular basis regarding reliability, supply  and demand, transmission, purchase and sale of electricity commodities,  and market participants—much of the needed information has not  previously been collected. Consequently, FERC is currently missing  some of these key pieces of information or is relying on third parties  such as energy news services for related information to assist in meeting  its market monitoring and oversight responsibilities. Without access  to this key information, FERC will not be able to fully understand the  performance of specific electricity markets across the country. In addition,  FERC will be less prepared to identify potential market manipulation that  may affect competitive markets. FERC’s existing authority is not adequate  to collect all the information it needs, resulting in these gaps of key  information. Moreover, legislation does not allow FERC to levy meaningful  criminal fines and civil penalties against market participants to ensure that  companies report accurate and reliable information, further diminishing  its ability to identify potential market manipulation. For these reasons, the  Congress may need to make decisions regarding the scope of information  collection at FERC and other agencies.
section_title: Recommendations for Executive Action
paragraphs: Given that effective oversight of evolving electricity markets requires the  acquisition of and access to timely, reliable, and complete information,  we recommend that the Chairman, FERC (1) demonstrate what  information FERC needs, (2) describe the limitations resulting from not  having this information, and (3) ask the Congress for sufficient authority  to meet its information collection needs and responsibilities. Additionally,  we recommend that FERC consider the cost and potential reporting  burden associated with additional information collection, since  market participants will incur additional costs and burden hours,  and where possible, explore creative ways to obtain information.
section_title: Agency Comments
paragraphs: We provided a draft of this report to FERC and DOE for their review  and comment. In its written comments, FERC generally agreed with the  report’s conclusions, specifically that its authority to collect information  has not kept pace with the changing electricity market and that its  ability to penalize noncompliance is severely limited. Regarding our  recommendation that FERC take action to resolve its information gaps,  FERC commented that it is in the process of conducting an internal  information assessment and the results will be provided at the end of  2003. This assessment should provide a first step toward implementing  our recommendations. However, in a related point, FERC also noted  that whatever information gaps exist with electricity supply, much  greater deficiencies exist on the demand side of the market, which is  largely beyond its jurisdiction but also important to understanding the  entire market.
FERC also noted that it must be mindful of the potential burden  imposed by additional information collections, and it has been inventive  in developing ways to monitor markets, particularly those operating under  its restructuring rules. FERC also provided several small corrections to the  draft report language and added other clarifications that we incorporated  into the draft where appropriate. The complete text of FERC’s comments  is included in appendix IV.
In its written comments, DOE agreed that the report generally  characterizes the current state of electricity data collection and  dissemination at EIA accurately and that it provides a balanced set of  recommendations on improving the timeliness of data dissemination in  the electricity industry’s restructured environment. DOE also commented  about our characterization of EIA’s mission and how EIA’s information is  used, as well as provided further clarification on the coverage of EIA and  RUS information collections and EIA’s resolution of data quality issues on  its Form 423. We incorporated EIA’s suggested information in these areas  along with previously provided technical corrections into the draft where  appropriate. The complete text of DOE’s written comments is included in  appendix V.
section_title: Objectives, Scope, and Methodology
paragraphs: To determine what electricity information is collected, used, and shared  by key federal agencies in meeting their primary responsibilities, we first  identified federal agencies using specific forms and form-like surveys for  collecting electricity information. These agencies included FERC, EIA and  Fossil Energy within DOE, RUS, SEC, and EPA. We obtained these forms  and form-like surveys and analyzed their contents, as summarized in  appendix I. We also identified third-party sources of information used  by federal agencies. These included the 13 companies identified in  appendix II. We analyzed this third-party information through a review  of Web-based materials and interviewed officials at Genscape, Edison  Electric Institute, and NERC. We also identified federal agencies that  collect, or have collected, electricity information for investigations and  interviewed officials at these agencies that included the Department of  Justice, the Federal Trade Commission, and the Commodity Futures  Trading Commission. For all federal agencies included in our review, we  obtained information on their missions by examining mission statements  on their Web sites. To understand how federal agencies use and share  electricity information, we interviewed federal officials at the federal  agencies mentioned above.
To determine the effect of restructuring on federal agencies’ collection,  use, and sharing of this information, we focused primarily on FERC  because it bears the main responsibility for monitoring electricity markets,  is undergoing major organizational changes caused by restructuring, and  has shown serious deficiencies in responding to restructuring. Within  FERC, we met with officials from OMOI and from its Office of  Markets, Tariffs, and Rates. To understand the gaps in FERC’s electricity  information resulting from restructuring, we interviewed officials at FERC  and NERC, reviewed information from third-party sources, and identified  federal authority contributing to these gaps. Although restructuring has  affected other federal agencies to a lesser extent, we identified the  relevant effects, if any, in these other agencies by interviewing officials  and reviewing pertinent documents. Among these other agencies, EIA has  been the most affected by restructuring. We examined specific impacts  at EIA that included increases in the number of entities from which EIA  collects data and the volume of information collected. We also examined  jurisdictional issues posed about FERC and SEC, and FERC and the  Commodity Futures Trading Commission. To understand how  restructuring has affected the way in which federal agencies share this  information, we examined concerns about confidentiality, particularly as  they related to EIA’s development of its current confidentiality policy and  FERC’s lack of access to NERC information because of NERC’s concerns  about the potential sensitivity of the information. In addressing the second  objective, we also relied on a broad range of our previously issued reports  on electricity restructuring and FERC’s oversight of electricity rates.
We conducted our work from June 2002 to May 2003 in accordance with  generally accepted government auditing standards.
As arranged with your offices, unless you publicly announce its contents  earlier, we plan no further distribution of this report until 14 days after  the date of this letter. At that time, we will send copies to appropriate  congressional committees, the Chairman of the Federal Energy Regulatory  Commission, the Secretary of the Department of Energy, the  Administrator of the Environmental Protection Agency, the Secretary of  the Department of Agriculture, the Chairman of the Securities and  Exchange Commission, the Attorney General of the United States, the  Chairman of the Federal Trade Commission, the Chairman of the  Commodity Futures Trading Commission, the Director of the Office of  Management and Budget, and other interested parties. We will make  copies available to others on request. We will also make copies available  to others upon request. In addition, the report will be available at no  charge on the GAO Web site at http://www.gao.gov.
If you or your staff have any questions about this report, please contact me  at (202) 512-3841. Key contributors to this report are listed in appendix VI.
section_title: Appendix I: Description of Data Collection Forms and Legislation Authorizing Collections for FERC and EIA
subsections: section_title: Federal Power Act (FPA) sections 304 and 309. These sections authorized the Federal Energy Regulatory Commission (FERC):
paragraphs: Used to monitor markets to ensure  that rates are just and reasonable,  and services are offered in a  nondiscriminatory manner.
Generation, transmission,  distribution, and sales of  electric energy from major  electric utilities and  licensees subject to FERC  jurisdiction. to collect and record data to  the extent it deems  necessary and  to prescribe rules and  regulations concerning  accounts, records, and  memoranda.
FERC may prescribe a system  of accounts for jurisdictional  companies and after notice and  opportunity for hearing, may  determine the accounts in  which particular outlays and  receipts will be entered,  changed, or credited.
Department of Energy’s  of each year for the  previous calendar  year. (DOE) Energy Information  Administration publishes  Form 1 data in aggregate  form.
Accountant uses the data in  its audit program and for  continuous review of the  financial conditions of  regulated companies.
The Office of Markets,  Tariffs, and Rates uses the  data in rate proceedings  and supply programs.
Policy and General Counsel  use the data in their  programs.
Data from schedules are  used to compute annual  charges assessed against  public utilities.  commissions use the data  to help satisfy their  reporting requirements for  public utilities and licensees  subject to state jurisdiction.
Same as above.
Same as above.
Same as  above.
Same as above.
FPA sections 205 and 206, as  amended by section 208 of the  Public Utility Regulatory  Policies Act (PURPA) (Public  Law 95-617). FERC is  authorized to collect basic cost  and quality of fuel data at  electric generating plants.
Collects information on the cost  and quality of fossil fuels delivered  to electric generating plants.
Cost, price, and quality of  fuels for generating plants.
FPA section 3 and sections 201  and 210 of PURPA.  These statutes authorize FERC  to encourage cogeneration and  small power production and to  prescribe such rules as  necessary in order to carry out  these statutory directives.
Filed by owners or operators of  small power production or  cogeneration facilities seeking  status as qualifying facility eligible  for benefits under PURPA,  including exemption from certain  corporate, accounting, reporting  and rate regulation requirements;  certain state laws; and where  applicable regulation under FPA.
Information related to the  facility’s ownership and  technical specifications.
Title II, section 211 of PURPA,  which amended part III, section  305, of FPA.  Section 305 defines monitoring  and regulatory operations  concerning interlocking  directorate positions held by  public utility personnel and  possible conflicts of interest.
Collects information from individual  public utility directors and officers  who hold interlocking directorates.
Information on public  utilities’ interlocking  directorates for possible  conflicts of interest.
Publicly available.  No later than 45 days  after the end of the  report month.
FERC uses the data to  conduct authorized fuel  reviews, rate investigations,  and monitor changes and  trends in the electric wholesale  market. Other government  agencies use the data to track  the supply, disposition, and  fuel prices on a regional and  national basis and conduct  environmental assessments.  Others use the data to assess  market competitiveness.
As needed.  FERC uses the information to  time period. determine whether a facility  meets the necessary  requirements and is entitled to  various PURPA benefits.
Publicly available.  On or before April 30th  for each preceding  year.
FERC collects this information  to monitor public utilities’  interlocking directorates for  possible conflicts of interest.
FPA section 305, as amended,  by section 211 of PURPA.
Information on the 20  largest purchasers of  electric energy.
FPA section 205 (f), as  amended, by section 208 of  PURPA.  This section authorizes the  interrogatory established in  Form 580 to take place not less  frequently than every 2 years.
Filed by jurisdictional public utilities  or public utility holding companies  engaged in the generation,  transmission, and sale of electric  power to report 20 of the largest  purchases of electric energy. Lists  customers and their business  addresses if they were 1 of the top  20 largest purchasers of electric  energy, measured in kilowatt hours  sold, for purposes other than  resale, during any of 3 preceding  calendar years.  Collects information from  jurisdictional public utilities that  own or operate power plants  generating 50 megawatts or  greater capacity.
Information on fuel cost and  cost recovery practices  under fuel adjustment  clauses in cost-based rates.
Publicly available.  On March 1 of the  year following the  reporting.
Used to identify large  purchasers of electric energy  and possible conflicts of  interest.
Publicly available.  Filed biennially on  June 1st for preceding  calendar period.
Used to review public  utility’s fuel purchase and  cost recovery practices under  fuel adjustment clauses in  cost-based.  Used to evaluate fuel costs  in individual rate filings, to  supplement periodic utility  audits, and to monitor changes  and trends in the electric  wholesale market.  Used by DOE’s EIA to study  various aspects of coal, oil,  and gas transportation rates.  Used by electric market  participants and the public  to assess the electric  marketplace during the  transition to a competitive  marketplace.
FPA sections 202, 207, 210,  211, 212, and 213, as  amended, and sections 4, 304,  309, and 311 of the same act.
Collects information from any  public utility or group of public  utilities operating as a control area  that has a peak load greater than  200 megawatts based on energy  for load. The information collected  allows FERC to analyze power  system operations in the course of  its regulatory functions. The  purpose of these analyses is to  estimate the effect of changes in  power system operations that  result from the installation of a  new generating unit or plant,  transmission facilities, and energy  transfers between systems and/or  new points of interconnections.  The analyses also serve to  correlate rates and changes;  assess reliability and other  operating attributes in regulatory  proceedings; monitor market  trends and behaviors; and  determine the competitive impacts  of proposed mergers, acquisitions,  and dispositions.
Generating plants included  in the reporting control area;  control area monthly peak  demand; control area net  energy for load and peak  demand sources by month;  adjacent control area  interconnections; control  area scheduled and actual  interchange; planning area  demand and forecast  summer and winter peak  demand and annual net  energy for load; and control  area hourly system lambda  data.
Publicly available.  On or before June 1  of each year for the  preceding calendar  year.
Used to monitor control area  planning hourly demand,  forecast summer and winter  peak demand, and annual net  energy for load.
FPA section 213 (b), as  amended, by the Energy Policy  Act (Public Law 102-486).  Section 213 (b) requires FERC  to collect annually from  transmitting utilities sufficient  information about their  transmission systems to inform  potential transmission  customers, state regulatory  authorities, and the public of  available transmission capacity  and constraints.
Provides information to potential  transmission customers, FERC,  state regulatory authorities, and  the public of potential transmission  capacity and known constraints.
Potential transmission  capacity and known  constraints.
FPA section 205(c).
Provides contract and power sales  data per Order 2001 issued on  April 25, 2002. Public utilities are  required to electronically file  Electric Quarterly Reports  summarizing the contractual terms  and conditions in their agreements  for all jurisdictional services  (including market-based power  sales, cost-based power sales, and  transmission service) and  transaction information for short- term and long-term market-based  power sales and cost-based power  sales during the most recent  calendar quarter.
Lists all contracts in effect  and all power sales made  during the previous quarter.
Data are now  restricted and  designated as  critical energy  infrastructure  information.
On or before April 1 of  each year for the  preceding calendar  year.
FERC uses the information to  facilitate and resolve  transmission disputes brought  before it. State and federal  regulatory agencies use the  information as a part of their  oversight functions. Potential  transmission customers use  the information to determine  transmission availability to or  from wholesale electric power  purchasers and sellers.
Publicly  available.
For the period from  January 1 through  March 31, file by April  30; for the period from  April 1 through June  30, file by July 31; for  the period July 1  through September  30, file by October 31;  and for the period  October 1 through  December 31, file by  January 31.
Information is available to the  public in a variety of formats. It  is used as an electronic  repository of all jurisdictional  contracts, to fulfill the FPA  requirements to have all rates  on file, and to provide price  data for market oversight  purposes.
Federal Energy Administration  Act (Public Law 93-275) and  the DOE Organization Act  (Public Law 95-91).  These two laws require EIA to  carry out a centralized,  comprehensive, and unified  energy information program.  EIA is mandated to collect,  evaluate, assemble, analyze,  and disseminate information on  energy resource reserves,  production, demand,  technology, and related  economic and statistical  information.
Collects information on regional  electricity supply and demand  projections for a 5-year advance  period and provides information on  the transmission system and  supporting facilities. This  information is used to assess the  adequacy of energy resources to  meet near and longer-term  domestic demands.
The information reported  includes (1) peak demand  and energy for the  preceding year and 5 future  years, (2) existing and  planned generating capacity  and the same for demand,  (3) scheduled capacity  purchases and sales,  (4) bulk electric transmission  system maps, and  (5) existing and proposed  transmission lines.
Publicly available,  except for  information on  plant location  (longitude and  latitude) and  tested heat rate.
Each NERC Regional  Council should file by  April 1 and after  review, NERC should  file the Form EIA-411  by June 30.
Used to monitor the current  status and trends of the  electric power industry and to  evaluate the future of the  industry.  Primary publication—Electric  Power Annual  EIA is required to provide  company-specific data to the  Department of Justice, or to  any other federal agency  when requested for official  use, which may include  enforcement of federal law.  The information may also be  made available, upon request,  to another component of DOE,  to any committee of Congress,  the General Accounting Office,  or to congressional agencies  authorized by law to receive  such information. A court of  competent jurisdiction may  obtain this information in  response to an order.
Same as above.
Collects information on accounting,  plant statistics, and transmission  data.
The information reported  includes (1) identification,  (2) electric balance sheet,  (3) electric income  statement, (4) electric plant,  (5) taxes, tax equivalents,  contributions, and services  during year, (6) sales of  electricity for resale,  (7) electric operation and  maintenance expenses,  (8) purchased power and  power exchanges,  (9) electric generating plant  statistics, (10) existing  transmission lines, and  (11) transmission lines  added within last year.
Same as above.
Collects information for DOE to  monitor electric utility system  emergencies.
The information reported  includes the type of  emergency, cause of  incident, and actions taken.
Publicly available,  except for  Schedule 9, lines  9 through 34, for  unregulated  entities.
Accounting data  (Schedules 1 through  8) of the Form EIA-412  to EIA within 4 months  following the end of  the financial reporting  year. All reports,  including Schedules 9  through 11, for the  given calendar year  must be submitted by  April 30.
Used to compile statistics  on the financial status of the  industry and to develop EIA  forecasting models.  Primary publications—Electric  Power Annual, DOE/EIA-0348;  State Energy Price and  Expenditure Report,  DOE/EIA-0376; and  Annual Energy Outlook,  DOE/EIA-0383.  EIA is required to provide  company-specific data to the  Department of Justice, or to  any other federal agency when  requested for official use,  which may include  enforcement of federal law.  The information may also be  made available, upon request,  to another component of DOE,  to any committee of Congress,  the General Accounting Office,  or to congressional agencies  authorized by law to receive  such information. A court of  competent jurisdiction may  obtain this information in  response to an order.
Publicly available,  except for the  information  reported on  Schedule 1, lines  4,5,6,7, and 8.
As needed.
As needed.  DOE uses the information  as the basis for determining  appropriate federal action to  relieve an electrical energy  supply emergency.  Primary publication—Electric  Power Monthly,  DOE/EIA-0226.
Same as above.
Collects information on cost and  quality of fossil fuels delivered to  U.S. electric plants.
Delivered price of fuel by  fossil fuel type and contract,  contract type and end date,  quality of fuel (heat content,  sulfur and ash content), and  volume delivered.
Publicly  available,  except for  fuel cost.
Filing to be  completed within 45  days of the close of  the business month.
Monthly/  annually.
With the exception of a handful  of state agency reports, the  FERC-423 and the EIA-423 are  the only timely public sources of  information of the price of fuel  delivered to electric generating  plants. Public agencies and private  analysts seeking to understand the  current and historical fuel  components of power prices and  generating plant operating costs  use the data widely.  Data from this form and the  FERC 423 appear in the  EIA publications—Electric Power  Monthly, Electric Power Annual,  Monthly Energy Review, and  Annual Energy Review.  EIA is required to provide  company-specific data to the  Department of Justice, or to  any other federal agency when  requested for official use, which  may include enforcement of  federal law.  The information may also be  made available, upon request, to  another component of DOE, to  any committee of Congress, the  General Accounting Office, or to  congressional agencies authorized  by law to receive such information.  A court of competent jurisdiction  may obtain this information in  response to an order.
Same as above.
Collects information on the design  and operations of organic-fueled or  combustible, renewable, steam- electric plants, regardless of  ownership status, which have a  total existing or planned generator  rating of 10 megawatts and above  (excluding nuclear power plants).
The information reported  includes (1) identification,  (2) plant configuration,  (3) plant information  (a) annual byproduct  disposition and useful  thermal output, (b) financial  information, (4) boiler  information (a) fuel  consumption and quality,  (b) air emission standards,  (c) design parameters,  (d) nitrogen oxide emission  controls, (5) generator  information, (6) cooling  system information  (a) annual operations,  (b) design parameters,  (7) flue gas particulate  collector information,  (8) flue gas desulfurization  unit information (a) annual  operations, (b) design  parameters, and (9) stack  and flue information— design parameters.
Publicly  available,  except for  information  relating to  plant  locations  (longitude  and  latitude).
To be submitted no  later than April 30  following the close of  the reporting year.
Data from this form appear in the  EIA publications—Electric Power  Annual, Annual Energy Review,  and Carbon Dioxide Emissions  from the Generation of Electric  Power in the United States.  EIA is required to provide  company-specific data to the  Department of Justice, or to  any other federal agency when  requested for official use, which  may include enforcement of  federal law.  The information may also be  made available, upon request,  to another component of DOE, to  any committee of Congress, the  General Accounting Office, or to  congressional agencies authorized  by law to receive such information.  A court of competent jurisdiction  may obtain this information in  response to an order.
Same as above.
Collects information on the retail  sales and revenue from  approximately 400 utilities and  other energy service providers that  have sales to end-user customers.
Retail sales of electricity by  end-user category, revenue,  megawatt hours, and  numbers of customers.
Same as above.
Collects information on the status  of existing and planned power  plants in the United States,  including those scheduled for initial  commercial operation within 5  years of filing this report. Also  tracks planned upgrades to  existing power plants.
Generating unit name,  ownership, operator,  location, cogeneration  status, and industry  category if a cogenerator,  prime mover type,  nameplate and summer net  generating capacity, initial  commercial operating and  retirement date, current unit  status, tested heat rate, fuel  sources, fuel delivery  transportation mode, and  FERC qualifying facility  information for  cogenerators.
Publicly  available,  excluding  energy  service  provider’s  revenues,  megawatt  hours sold,  and number  of  customers.
Filing should  be completed  by the 10th  working day,  following the  close of the  business  month.
The EIA-826 is the only timely source of  information on the price and volume of power  sold to retail customers in the United States.  Data from this form appear in the EIA  publications—Electric Power Monthly,  Electric Power Annual, Monthly Energy  Review, and Annual Energy Review.  EIA is required to provide company-specific  data to the Department of Justice, or to any  other federal agency when requested for  official use, which may include enforcement  of federal law.  The information may also be made available,  upon request, to another component of DOE,  to any committee of Congress, the General  Accounting Office, or to congressional  agencies authorized by law to receive such  information. A court of competent jurisdiction  may obtain this information in response to  an order.
Publicly  available,  except for  latitude and  longitude of  plant  location and  tested heat  rate.
On or before  February 15  of the  reporting  calendar  year.
The EIA-860 is the primary source of  information on the inventory of power plants  in the United States. As such, it is widely  used by public and private analysts  interested in such topics as adequacy of  power supplies and air pollution emissions.  Data from this form appear in the EIA  publications—Electric Power Annual and  Annual Energy Review.  EIA is required to provide company-specific  data to the Department of Justice, or to any  other federal agency when requested for  official use, which may include enforcement  of federal law.  The information may also be made available,  upon request, to another component of DOE,  to any committee of Congress, the General  Accounting Office, or to congressional  agencies authorized by law to receive such  information. A court of competent jurisdiction  may obtain this information in response to  an order.
Same as above.
Collects annual data from the  universe of U.S. utilities and  nonutility power producers on retail  power sales and energy  distribution.
Collects information  on system peak, net  generation, energy balance,  demand-side management,  and the sales and  distribution of electricity  in the United States.
Publicly  available.
By April 30,  following the  calendar  year.
The EIA-861 is the primary source of data  for public and private analysts seeking  information on electric power sales,  revenues, and average prices.  Data from this form appear in the EIA  publications—Electric Power Monthly,  Monthly Energy Review, Electric Power  Annual, Annual Energy Outlook, Annual  Energy Review, and Financial Statistics for  Major U.S. Publicly Owned Electric Utilities.  EIA is required to provide company-specific  data to the Department of Justice, or to any  other federal agency when requested for  official use, which may include enforcement  of federal law.  The information may also be made available,  upon request, to another component of DOE,  to any committee of Congress, the General  Accounting Office, or to congressional  agencies authorized by law to receive such  information. A court of competent jurisdiction  may obtain this information in response to  an order.
EIA-906—Power Plant Report  Same as above.
Collects information on electric  power generation, useful thermal  output, fuel consumption, the heat  content of fuels, and stocks of  fossil fuels from electric power  plants in the United States.
Data on electric power  generation, fuel  consumption, useful thermal  output, fuel heat contents,  and stocks.
Publicly  available,  excluding  information  on stocks  at end of  reporting  period.
For monthly  respondents,  submission is to be  completed by the  10th working day,  following the close  of the month. For  annual respondents,  submission is to be  completed by the  last working day of  January following  the end of year.
Monthly/  annually.
The EIA-906 is the primary source of  information on power plant generation, fuel  consumption, and fuel stocks. Data are  widely used by industry, state government  agencies, trade associations, and federal  agencies for energy analyses and policy- making decisions.
Data from this form appear in the EIA  publications—Electric Power Monthly,  Electric Power Annual, Monthly Energy  Review, Annual Energy, and Renewable  Energy Annual.
EIA is required to provide company- specific data to the Department of Justice,  or to any other federal agency when  requested for official use, which may  include enforcement of federal law.    The information may also be made  available, upon request, to another  component of DOE, to any committee of  Congress, the General Accounting Office,  or to congressional agencies authorized  by law to receive such information. A court  of competent jurisdiction may obtain this  information in response to an order.
According to EIA’s Electric Power Annual 2001 report, beginning with data collected from the year  2000, the Forms EIA 860A and 860B are obsolete. The infrastructure data collected on those forms  are now collected on the Form EIA-860 and the monthly and annual versions of the Form EIA-906.
section_title: Appendix II: Third-Party Data Sources
paragraphs: Appendix II: Third-Party Data Sources  Description  FriedWire is an energy information provider, specializing in Web-based data  collection and integration. Its Traffic Report is a real-time visual monitoring system  covering electric power grid operations in North America. Its Powersurge is a real- time monitoring system for Northeastern and Canadian electric power markets. Its  WestDesk provides similar information for western electric power markets. Its Analyst  Edge is an on-line energy database created to support the needs of energy market  analysts. Its Data Feed Service and Energy Data Warehouse provide updates of  energy market information and historical information.   Genscape provides current information related to generation and transmission of  some fossil and nuclear power plants in the United States. Genscape guarantees  accuracy of 90 percent or better based on its direct, physical monitoring of power  plant outputs.  Electric Power Research Institute has developed an on-line, Web-based display of  power market transactions and includes information on schedules and congestion.  The data are useful for transmission planning.  Bloomberg’s PowerLines is a trade press publication providing electricity news.  Bloomberg’s Professional Services provides current and historical data on regional  electricity and gas markets, including spot and future prices, market commentary,  plant outage information, and energy news.   NERC provides real-time information on transmission constraints in the northeast. Its  Flow Impacts Study Tool provides information about the real-time flow and expected  flow for the next 36 hours for specific transactions.   Open Access Technology International provides information on electricity  transmission useful for scheduling and meeting electricity deliveries.   EarthSat provides weather forecasts and historical weather data for selected cities.  Energy Argus provides news concerning electricity and gas operations and prices.  InterContinental Exchange provides information on over-the-counter energy  transactions.  PowerWorld Corporation’s Simulator is an interactive package designed to simulate  high voltage power system operation. It gives an analyst a comprehensive look at  issues surrounding electrical power flows in a transmission grid.
Resource Data International Data Resources  via Platt’s:  (1) PowerDat  (2) GasDat  (3) NewGen  (4) PowerMap  (1) Historical data related to electric industry.  (2) Historical data related to gas industry.  (3) Database consists of new proposed generation.  (4) Tool to generate maps, including transmission lines, gas pipelines, and  generation.  Through publications such as Megawatt Daily and Gas Daily, Platt’s provides daily  energy news related to electric and gas issues.  Cambridge Energy Research Associates provides various services related to  regional electric, gas, and transmission issues. These include, for example, its North  American Electric Power Advisory Service, which focuses on the future of the power  sector and the forces affecting the market, prices, and emerging trends and  technology. Other services include its North American Natural Gas Advisory Service,  its Electric Transmission Advisory Service, and its Western North America Energy  Advisory Service.
section_title: Appendix III: EIA Confidentiality Elements
section_title: Appendix IV: Comments from the Federal Energy Regulatory Commission
section_title: Appendix V: Comments from the Department of Energy
section_title: Appendix VI: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Acknowledgments
paragraphs: In addition to the individual named above, Angelia Kelly, Dennis Carroll,  Jose Martinez-Fabre, Jon Ludwigson, Jonathan McMurray, Frank Rusco,  and Barbara Timmerman made key contributions to this report.