On Oct. 19, 2023, the Federal Energy Regulatory Commission (FERC) issued a Notice of Proposed Rulemaking (NOPR) in Docket No. RM23-9-000 to modify filing processes for Electronic Quarterly Reports (EQRs) and revise and eliminate a number of data fields and definitions. Comments will be due 60 days after the proposal’s publication in the Federal Register, Monday, December 26, 2023. The NOPR was published in the Federal Register today, October 27, 2023.
If adopted, FERC’s proposals would be the most significant overhaul to its EQR processes and substantive requirements since 2012, when FERC Order Nos. 768 and 770 adopted substantive changes and established the current process for filing directly through the FERC website.
A final rule in this proceeding would impact all entities that are required to file EQRs, meaning public utilities and nonpublic utilities above a de minimis market presence threshold. The proposed reforms are an extension of FERC’s efforts to modernize form filing processes to use eXtensible Business Reporting Language (XBRL). Following a series of technical conferences beginning in 2020, FERC’s NOPR proposes to streamline the EQR process filing and move to XBRL as it has done for other data submissions, like the FERC Form 1. In the course of those technical conferences, FERC and stakeholders also evaluated the current data fields and their usefulness, and is proposing significant changes to the EQR Data Dictionary and data collection.
Briefly, FERC’s proposals in the NOPR are as follows:
Proposed Procedural Changes (Section III of the NOPR)
- There would be only one method of data submission, and it will use XBRL applied to the existing Comma-Separated Value (CSV) format used by most EQR filers (XBRL-CSV standard).
- Regional Transmission Organizations (RTO) and Independent System Operators (ISO) would be required to produce reports containing market participant transaction data in XBRL-CSV format that adhere to the FERC EQR taxonomies, which sellers could use to prepare their EQR submissions.
- EQR filers’ quarterly filing deadline would be extended to four months after the close of the relevant quarter (rather than the current one-month deadline).
- Sellers would be able to file and supplement data on a rolling basis before the close of the quarter, rather than make a single submission with all required data.
- FERC’s refiling policy would become more burdensome, with corrections to be filed for the prior 20 quarters (i.e., five years) or as far back as the error(s) occurred, depending on which time frame is shorter, versus the current 12-quarter (three-year) look back. In addition, this refiling obligation would extend to entities that made sales without prior market-based rate (MBR) authorization.
Proposed Changes to Required Data (Section IV of the NOPR)
- Sellers would no longer be required to report transmission capacity reassignment information, identify the index price publisher(s) to which they report transactions, or identify which exchange or broker was used to consummate transactions in their EQRs.
- The NOPR proposes a number of changes to data fields and definitions, all described in two attachments to the NOPR: the Modified Data Fields Summary and the Proposed EQR Data Dictionary.
Proposed Filing Process Changes
Streamlining Submission Method to XBRL. The NOPR proposes to streamline data collection by moving to a single option for EQR submission, which would use the XBRL-CSV standard. The use of XBRL is intended to allow industry and other data users to automate submission, extraction and analysis of EQR data.
Use of the new standard will permit sellers to continue using Excel spreadsheets to prepare and review data while adding the flexibility of XBRL and resolving some limitations of the current CSV format, such as Excel spreadsheet line limits. The new system also would allow sellers to submit and supplement data on a rolling basis prior to the filing submission deadline, should they choose to do so, rather than make a single filing with all required data. FERC proposes to provide preformatted templates that would conform with the requirements of the new system. If the changes are adopted, filers would be required to file using the new XBRL-CSV standard. The existing options to file in XML format or manual data entry through the FERC website’s EQR webform would no longer be available.
Mandatory RTO/ISO Transaction Data Obligation. The NOPR proposes to require RTOs and ISOs to produce reports containing market participant transaction data in XBRL-CSV format that adhere to the FERC EQR taxonomies, which sellers can use to prepare their EQR submissions. This change is intended to help sellers prepare and submit their EQR transaction data by reducing the amount of manual data manipulation necessary before submitting transaction data in EQRs, and increase data standardization of RTO/ISO transactions reported in the EQR, particularly for sellers transacting across multiple markets.
Extension of Quarterly Filing Deadline. The NOPR proposes to extend the existing quarterly filing window from the current one month after the close of the quarter, to four months, as shown below:
|Quarter||Reporting Period||Current Deadline||Proposed Deadline|
|First||Jan. 1 – March 31||April 30||July 31|
|Second||April 1 – June 31||July 31||Oct. 31|
|Third||July 1 – Sept. 31||Oct. 31||Jan. 31|
|Fourth||Oct. 1 – Dec. 31||Jan. 31||April 30|
The intent of this change is to promote greater data accuracy, while reducing the number of necessary refilings due to resettled prices. FERC further proposes to allow sellers to file data beginning any time during the reportable quarter, or during the four-month filing period after the close of the quarter, instead of requiring sellers to wait until the reportable quarter ends.
Refiling Policy. FERC historically has required EQR filers that need to correct prior filings to file data for the preceding 12 quarters, or three years. (See “Plan for Retrospective Analysis of Existing Rules” at 4, Docket No. AD12-6-000, Nov. 8, 2011.) The NOPR proposes to extend that obligation to 20 quarters, meaning five years’ worth of data, or as far back as the error(s) occurred, whichever time frame is shorter. FERC also proposes to apply the 20-quarter refiling policy to unauthorized sales where, for example, a seller makes wholesale sales without prior FERC authorization under FPA Section 205 and then must file or refile EQRs to report those sales. FERC’s justification for the change is alignment with its five-year record retention requirement for MBR sellers.
Proposed Revisions to Data Reporting Requirement
Elimination of Certain EQR Reporting Requirements. The NOPR proposes to eliminate the requirements for sellers to submit the following data, finding that it provides limited value or duplicates information provided elsewhere:
- Transmission capacity reassignment transactions.
- Identification of any index price publisher(s) to which an EQR filer reports transactions also reported in the EQR.
- Identification of an exchange or broker used to consummate a reported transaction.
FERC recognizes that each of these eliminations from EQR reporting would make such information unavailable to the public. Therefore, it seeks comment on whether the information is helpful to the public, and if so, how this data is used.
Modified Data Fields and Definitions. The NOPR proposes to add new data fields, delete certain data fields, modify data field names and revise certain definitions and requirements. These proposals are designed to update and streamline the data collection, improve data quality and increase market transparency. A summary of all of the data field changes is detailed in the Modified Data Fields Summary, available on FERC’s EQR website, and revised definitions are shown in the Data Dictionary attached to the NOPR.
Potential Implications for EQR Filers
If adopted, the NOPR proposals would have wide-ranging implications for EQR filers, potentially impacting internal compliance controls, internal or vendor software, and internal data collection. Key considerations include:
- Technical Issues. The NOPR proposes that EQR taxonomies and related documents to implement the XBRL-CSV Standard would be developed after issuance of a final rule and would involve stakeholder outreach and one or more technical conferences. EQR filers will need to evaluate their current filing process and coordinate with internal IT and/or external vendors to develop a path forward.
- Increased EQR Correction Burden. The NOPR’s proposal to increase the three-year refiling look back to a 20-quarter/five-year look back is a significant increased compliance burden should an EQR filer need to make corrections. EQR filers should consider refreshed or increased training for personnel with EQR filing obligations to work to minimize filing and data collection errors.
- Revised Data Fields and Definitions. The NOPR proposes significant changes to currently collected data and definitions. It will be critical to evaluate these changes and internal processes to consider any necessary changes to internal data collection and compilation practices and to ensure that personnel involved in EQR filings understand the substantive changes to definitions.
- Potential Process Enhancements. A number of proposals appear to be beneficial, particularly the increased filing deadline and requirement for RTOs/ISOs to provide transaction data in a particular format. If the proposals are adopted, EQR filers should evaluate and adjust their current internal compliance processes for preparation and submission.
- New Requirement to File Historical EQRs for Unauthorized MBR Sales. The NOPR proposes to require entities to file 20 quarters (five years) of historical data for any unauthorized MBR sales, or as far back as the sales were made, whichever period is shorter. Current practice involves filing for MBR authorization and a refund report, if applicable. This would be an additional and potentially very burdensome requirement that would involve locating and organizing historical data.
For further details, see the full text of the NOPR. The McGuireWoods energy team will continue to monitor this docket and provide further updates as they arise. For more information, please contact the authors.