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EEI Testifies on the Future of the CFTC
Edison Electric Institute (EEI) Vice President of Energy Supply and Finance Richard McMahon testified today at a hearing before the House Agriculture Committee’s Subcommittee on General Farm Commodities and Risk Management on “The Future of the CFTC: End-User Perspectives.”
 
Passed in 2011, the Dodd-Frank Act provides certain exemptions for non-financial end-users, such as electric utilities, recognizing that they are not the entities posing systemic risk to the financial system.  EEI has been working with the Commodity Futures Trading Commission as the Dodd-Frank Act is implemented to ensure that the congressional intent of exempting non-financial end-users remains intact. EEI’s members use derivatives swaps and futures contracts to limit risk and help insulate their customers from price volatility in wholesale electricity and natural gas markets.
 
“Our members support the Dodd-Frank Act’s primary goals of protecting the financial system against systemic risk and increasing transparency in derivatives markets,” said McMahon. “We believe, however, that there are areas where Congress should consider minor adjustments to ensure the Dodd-Frank Act achieves its purpose while not inadvertently impeding end-users’ ability to hedge.”