FEC Questions Derivative Use

Fortnightly Magazine - February 15 1995
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The Federal Energy Regulatory Commission (FERC) will allow Aquila Power Corp., a power marketing subsidiary of UtiliCorp United Inc., to sell electricity at market-based rates, and has approved open-access transmission tariffs for UtiliCorp (Docket Nos. ER95-203-000 and ER95-216-000). Commissioner William L. Massey used the case as an opportunity to state on the record that the FERC needs a better understanding of derivatives and their use in financial management.

Aquila had asked the FERC to say that it lacks jurisdiction over risk-management transactions by power marketers. But the FERC said it intends to consider risk-management transactions in another order in the future.

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