The Commodity Futures Trading Commission (CFTC) Monday was rewarded for its years of lobbying when the Obama administration proposed a major hike in the annual budget of the agency that oversees the energy futures markets. However, the Obama administration’s requested budget increase for another regulator, the Federal Energy Regulatory Commission (FERC), was more modest.

President Obama proposed a budget of $261 million for the CFTC for fiscal year (FY) 2011 — a 55% hike ($93 million) over the budget of $168.8 million in the current FY. ‘The president’s budget request provides a much-needed funding increase to better enable the CFTC to regulate the markets and protect the American public,” said CFTC Chairman Gary Gensler.

The CFTC for years has been calling on the administration and Congress to give the agency a greater “infusion of human and fiscal capital” to regulate the futures and options markets, which have grown exponentially over the years (see Daily GPI, March 16, 2009).

The Obama administration requested $315.6 million for FERC in FY 2011, an increase of 5.9% ($17.5 million) over the current FY. The budget calls for 1,539 full-time employees (FTE) — an additional 11 FTEs to carry out FERC’s reliability and critical infrastructure protection standards development and compliance processes; enforcement efforts; and policy reforms related to renewable resources and advanced technologies.

The bulk of FERC’s proposed budget is earmarked for electric power ($167.76 million), while $77.52 million will be allocated for natural gas and oil pipelines, and $70.5 million for hydropower. Likewise, the majority of the FTEs (832) will be devoted to electric power, while 379 FTEs will work on natural gas and oil pipeline issues, and 328 FTEs on hydropower issues.

FERC recovers the full cost of its operations through annual charges and filing fees assessed on the industries it regulates.

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