FERC staff has offered the industry and price developers another opportunity to comment on the current state of natural gas and electricity price formation and to say whether there has been any increase in confidence in natural gas and electric price indices.

The staff request for comments (PL03-3, AD03-7) issued Friday noted that in addition a second detailed survey of buyers and sellers in the industry as to their reporting practices would be issued soon.

The current notice, however, asks more general questions. For instance, price reporting entities are asked whether the Policy Statement safe harbor for good faith reporting has influenced their decision on reporting of price transaction data, and whether they have more confidence in price indices today than before issuance of the Policy Statement.

Companies also are asked whether they have adopted standards for reporting set out in the Policy Statement. And they are asked to comment on their view of the operations of the price developers or survey publishers.

In that regard FERC wants to know whether “changes by price index developers materially improved the transparency of information contained in price indices,” and whether “price index developers provide enough information about the level of trading activity at locations for which index prices are provided.”

Regarding the clarity of the published information, market participants are asked whether the price developers make clear when information is simply ‘market price indications’ rather than indexes prepared using their stated methodology.

They also are asked to detail any specific concerns they might have regarding the quality of price indices.

Price developers or the publishers of indexes are asked to update their previous filings regarding codes of conduct, confidentiality, methodologies, volume and transaction indicators, procedures for data verification, error correction and monitoring, audit procedures, and accessibility to the Commission in the event of suspected bad faith reporting or potential manipulation.

The publishers also are asked to discuss any increases in reporting entities and fixed price transactions reported since their last response to the Commission in January. (NGI’s initial response was filed in PL03-3 Jan. 14. A copy is available here on its website.)

When it issued it Policy Statement last year, FERC said it would hold off further action for an interim period, through the winter, and after that would reassess the situation. The Commission has threatened to impose mandatory price reporting if it does not believe the voluntary system is working.

Last week Chairman Pat Wood warned that a new survey would be going out to companies by the end of the month and told reporters “I think it’s real helpful for people that if they’re thinking about reporting their fixed price trade price surveys that they hurry up and do so before they get the questionnaire from us.” FERC would “really like to see a real high participation rate there” (see Daily GPI, March 4).

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