2014 Energy Regulatory Compliance Survey | Deloitte US has been added to your bookmarks.
2014 Energy Compliance Survey Report
Front and center
Regulatory compliance is a significant risk area that needs to be addressed proactively. Relying on a reactive approach can lead to heavy fines, but perhaps even more important, it may require a frenzy of corrective action that distracts the organization from its core business. To avoid problems and last minute fire drills, companies need to stay abreast of changes in the regulatory landscape and take action before risks develop into crises. The findings from this year’s survey provide critical insights about what companies and regulators are focusing on, and what the top compliance priorities should be.
- Entreprise compliance key takeaways
- NERC compliance key takeaways
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Regulatory compliance issues remain front and center for U.S. energy companies. Major shifts in the regulatory landscape are affecting everything from commodity transacting to infrastructure reliability; yet, there is still a lot of uncertainty about the specific requirements and key focus areas for compliance. Regulations and policies continue to evolve, and tools and technologies are not providing the silver bullet that many companies were hoping for. Additionally, there seems to be a growing emphasis on companies conducting their own self-policing and oversight management as regulators look to maximize their impact with limited budgets (which also raises expectations that companies will be more proactive in managing their own compliance obligations).
Entreprise compliance key takeaways
Effective regulatory compliance requires a coordinated effort across the enterprise. While the past few years have seen a steady increase in the number of companies centralizing their compliance operations under a single Chief Compliance Officer, it appears that many energy companies are still using a traditional, siloed approach to compliance.
Some key takeaways from the survey:
- To promote good behavior, look for opportunities to link metrics to compensation—but with a positive spin.
- Use on-the-job performance metrics to adjust the company’s training program from one year to the next.
- Survey operations personnel about what areas they want to receive better training.
- When selecting a GRC system, develop a strong business case that clearly defines what problems you are trying to solve.
- GRC systems are most effective when used to integrate many or most compliance-related activities—including compliance monitoring and reporting, risk management, and financial reporting—across numerous parts of the business.
NERC compliance key takeaways
For most power and utility companies surveyed, satisfying NERC's requirements related to the reliability of the bulk electric system is the biggest reported compliance challenge.
Some key takeaways:
- Don’t underestimate NERC CIP version 5; start planning as soon as possible.
- Consider developing in-house expertise now so that when the detailed implementation work for CIP version 5 begins you will have the right resources in place.
- Although many NERC initiatives are still in progress, there are actions that you can take now to start preparing and avoid a last minute scramble.
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What are energy companies doing to address their compliance challenges, and how can they stay ahead of regulatory trends and requirements without creating unnecessary drag on the business?
This year's survey focused on four main areas:
- Enterprise Compliance
- NERC Compliance
- CFTC Compliance
- FERC Compliance
Key takeaways from some of these sections are highlighted above. For additional insights, download this years survey report to discover how energy leaders talk about the state of their compliance efforts today—and where they need to be tomorrow.