FERC won't rule out mandatory price reporting

WASHINGTON -- The chairman of the Federal Energy Regulatory Commission said recently the agency had not ruled out requiring energy companies to report electricity and natural gas prices.=

Mandatory price reporting is "certainly something people are still kicking around and may be something we ought to consider again," FERC Chairman Pat Wood told reporters at a news briefing.

"We've got to have data we can depend on ... We've got to have some basic standards that apply to everybody."

The FERC has sought to boost confidence in price reporting after the Commodity Futures Trading Commission last year found at least six large traders submitted bogus information to index publishers.

The indexes calculated and published by Platt's and Energy Intelligence Inc. are used to price billions of dollars in supply contracts.

The FERC has urged wholesale suppliers of natural gas and electricity to adopt a set of voluntary guideline issued by the agency last July to improve the accuracy of prices reported to private publishers of price indexes.

Among the FERC suggestions were that companies assign price reporting duties to independent employees who do not trade.

"I don't know that it's inevitable (to move toward mandatory price reporting)," Wood said. "We're going to ask this question again in March."

The energy trading industry has been in chaos with the collapse of Enron Corp., a series of federal investigations into the California energy crisis and heavy debt among trading companies.

A FERC staff report in early 2003 found an "epidemic" of false prices reported to publishers and evidence of market manipulation by some large traders.

Consumer groups have urged the FERC to require companies to report their prices to either index publishers or a central clearinghouse, a move that is opposed by most of the energy industry. Reuters Group Plc, the global information provider, is among the groups that have submitted proposals to the FERC on ways to collect and disseminate market data.

Reuters