While cracking down on market fraud and abuse with tough new penalties, the draft energy bill also seeks to increase transparency in natural gas prices by ordering regulated entities to report prices to the Federal Energy Regulatory Commission and to price publishers.
The transparency provisions would require FERC to issue rules within six months of enactment of the bill, directing jurisdictional entities to report information about the availability and price of natural gas in the wholesale interstate market to the Commission and to price publishers. FERC could not, however, condition access to interstate transmission on compliance with the reporting requirements.
FERC is directed to evaluate the data for adequate price transparency and accuracy, but it may not “compete with, or displace from the marketplace, any price publisher; or regulate price publishers or impose any requirements on the publication of information.”
The Commission could only make aggregated data public and any transaction-specific data that is already required by FERC rules.
Producers selling their own production would be exempt from reporting requirements, as would market participants who have a “de minimis market presence.”
The Commodity Futures Trading Commission could prosecute for “knowingly false or knowingly misleading or knowingly inaccurate” price reports, the bill clarifies, emphasizing the “knowingly”aspect. Penalties for false reporting or attempts to defraud others in the market or for wash trades would be upped from $5,000 to $1 million and from two years in prison to five years.
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