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Federal Energy Regulatory Commission




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Division of Energy Market Oversight

Overview
The Division of Energy Market Oversight (Market Oversight) is responsible for monitoring the nationís wholesale natural gas and electric power markets. Market Oversight examines and analyzes the structure and operation of the markets to identify anomalies, inefficient market rules, tariff and rule violations, and other unusual market behavior as well as significant market events and trends. It also analyzes market-based rate transactions to determine whether entities are exercising market power and reports its various analyses and observations to the Commission and, as appropriate, to the public. Market Oversight also collaborates with other Commission offices to develop regulatory strategies, focusing on the competitiveness, fairness, and efficiency of wholesale energy markets. Finally, Market Oversight administers, analyzes, and ensures compliance with the filing requirements of Electric Quarterly Reports (EQRs) and various Commission forms.

Functions

  • Market-Based Rate Ex Post Analysis - Market Oversight develops, refines, and implements tools and algorithmic screens to conduct ongoing analysis of transactional and other market data to detect the presence of market power and ensure that jurisdictional rates remain just and reasonable and not unduly discriminatory or preferential. This ex post analysis evaluates transactions against market fundamentals at the time of execution with the primary goal of identifying outcomes that may be inconsistent with expectations of a competitive market, and thus an indication of an exercise of market power. Once such outcomes are identified, Market Oversight coordinates with other Commission program offices to determine whether to recommend the Commission take action to remedy market power concerns. Market Oversight also uses these tools to analyze applications and filings for market-based rates, public utility mergers, and other docketed proceedings.


  • Market Monitoring - Market Oversight staff examines data from a variety of sources to review market fundamentals and emerging trends and to examine the structure, operation, and interaction of natural gas and electric markets. As developments warrant, Market Oversight staff initiates projects designed to evaluate market trends and to assess participant behavior. Staff also presents analyses at Commission meetings. Such presentations include the Annual State of the Markets Report and Seasonal Market Assessments.


  • Outreach and Communication - Market Oversight makes available to the public its analyses by posting reports on its website and hosting periodic snapshot calls with public utility commissions and state agencies. Staff also briefs visiting industry participants, state and federal officials, and foreign delegations on the Commissionís market monitoring activities. Market Oversight has developed a resource manual entitled Energy Primer: A Handbook of Energy Market Basics, which provides the public with a broad overview of the physical wholesale markets for natural gas and electricity and energy-related financial markets.


  • Forms Administration and Compliance - Market Oversight staff administers and ensures compliance with the Commissionís forms filing requirements for the EQR, as well as forms Nos. 1, 1-F, 2, 2-A, 6, 3-Q, 6-Q, the Form 60 and FERC-61, the Form 549D, the Form 552 and the FERC-730.


  • Agenda Items and Rulemakings - Market Oversight assists the Commission in evaluating the efficacy of certain regulatory policies in light of evolving energy markets and ensures that the Commission has the information needed to administer and monitor the markets effectively. Through its work on docketed proceedings, Market Oversight seeks to enhance market transparency and efficiency while balancing the regulatory burden on market participants.