Last week, Senator Reid introduced S.3268, the Stop Excessive Energy Speculation Act. The bill would amend the Commodity Exchange Act to include coverage of energy commodities defined as petroleum products and natural gas. The bill defines "legitimate hedge trading" as "the conduct of trading that involves transactions by commercial producers and purchasers of actual physical petroleum and energy commodities for future delivery and the direct counterparties to such trades (regardless of whether the counterparties are commercial producers or purchasers)." CFTC would be required to develop rules establishing speculative position limits for persons engaged in "nonlegitimate hedge trading of an energy commodity." CFTC shall exercise oversight of "major market disturbances" (commodity market disruptions impacting liquidity and price discovery) and in response could order liquidation of OTC transactions and setting market position limits on OTC transactions. CFTC would require index traders and swap dealers to provide detailed reporting. A Working Group on Energy Markets comprised of the Secretarys of Energy and Treasury and Chairs of FERC, FTC, SEC, and CFTC and Administrator of EIA would be formed and charged with investigating the effect of speculation in energy commodities on energy prices and the country's energy security. FERC would be required to investigate the role of financial institutions in natural gas markets. The full text of S.3268 is available on the NEM Website.

In conformance with the recently enacted Do Not Call Registry Fee Extension Act, the FTC has updated the fees for access to the DNC registry. Access is still free for the first five areas codes of data for all entities. The annual fee for access to the DNC registry has been reduced to $54 per area code of data (from the current $62 per area code), or $27 per area code of data during the second six months of an entity's annual subscription period. This fee would be capped at a maximum charge for any entity of $14,850 per year (reduced from a maximum of $17,050 per year). The new fees are for the 2009 fiscal year. Subscriptions to the DNC registry purchased before October 1, 2008, will be subject to the current fees, and subscriptions purchased after that date will be subject to the new, lower fees. The full text of the DNC Registry Fee Rule is available on the NEM Website.

NYISO made an "exigent circumstances" filing with the FERC to revise its tariff "because a relatively small number of Market Participants are scheduling transactions over circuitous Scheduling Paths around Lake Erie to take advantage of a 'seam' between the methods that are used by the organized markets in the Eastern Interconnection to price External Transactions." While NYISO says it has not identified a violation of its tariff or market rules, it says that the scheduling is "adversely affecting the operation of the ISO-Administered markets." NYISO proposed tariff changes to preclude the scheduling of External Transactions over eight Scheduling Paths. NYISO requested the Tariff revisions become effective July 22, 2008. NYISO argued the change is necessary to have actual power flows more closely conform to scheduled power flows. It also notes a seam between the method the NYISO and IESO use to price External Transactions and the method that PJM and MISO use to price External Transactions that is causing "increasing levels of inefficient transactions."

Comments on the NYISO proposal are due August 1, 2008. The full text of the NYISO Filing is available on the NEM Website. Please join NEM for a conference call on the NYISO Filing on Monday, July 28, 2008, at 10AM EST. The dial-in is 913-643-5111 and the passcode is 209353.