One of the most significant provisions in the Energy Policy Act of 2005 is the repeal of the Public Utility Holding Company Act of 1935 (PUHCA 1935). The statute was administered by the U.S. Securities and Exchange Commission (SEC). The Energy Policy Act of 2005 repealed PUHCA 1935, thus revoking the SEC's authority to oversee mergers and other transactions of public utility holding companies. PUHCA 2005 expands the authority of the Federal Energy Regulatory Commission (FERC) to oversee transactions and other financial activities of public utility holding companies through grants of access to those companies' books and records. The U.S. Department of Justice (DOJ) and the Federal Trade Commission (FTC) are both charged with enforcing the applicable antitrust statutes, § 7 of the Clayton Act and the pre-merger provisions of the Hart-Scott-Rodino Antitrust Improvements Act of 1976. PUHCA 1935 regulated "holding companies" that had subsidiaries that were electric utility companies or that engaged in the retail distribution of natural gas or manufactured gas. Under the statute, public utility holding companies faced substantial restrictions on their operations. PUHCA 1935 also placed restrictions on many transactions related to public utility corporate structure. Congress repealed the entirety of PUHCA 1935 in the Energy Policy Act of 2005. These important exemptions include passive investors (mutual funds and other collective investment vehicles); broker/dealers, underwriters and fiduciaries who buy and sell securities in the ordinary course of business; utilities that have no captive customers; transactions in which the holding company affirmatively certifies that it will not charge, bill, or allocate to the public utility or natural gas company in its holding company system any costs or expenses and will not engage in financing transactions with the public utility or natural gas company; transactions between or among affiliates that are independent of and do not include a public utility or natural gas company; electric power cooperatives; and local gas distribution companies. The Continuing Regulatory Authority of FERC, FTC, and DOJ

As FERC has stated, the change in PUHCA law granting it new authority to review books and records did not affect the Commission's
... primary means of protecting customers served by jurisdictional companies that are members of holding company systems: the [Federal Power Act (FPA)] and the [Natural Gas Act (NGA)]. As the previous paragraphs describe, although the repeal of PUHCA 1935 removes extensive restrictions on transactions involving public utilities and their holding companies previously enforced by the SEC, it does not affect the regulation of these entities by FERC.
The Public Utility Holding Company Act of 1935 (PUHCA 1935) was repealed in the Energy Policy Act of 2005. Prior to repeal, PUHCA 1935 required "holding companies" (i.e., companies with subsidiaries engaged in the electric utility business or the retail distribution of natural or manufactured gas) to register with the U.S. Securities and Exchange Commission (SEC), satisfy certain disclosure requirements, and comply with strict operational limitations. These operational limitations imposed significant geographic and corporate holdings restrictions upon holding companies and effectively limited ownership of public utilities to a small subset of companies focused specifically on the industry.
Pursuant to the repeal, the SEC no longer has oversight authority for electric and gas holding companies, and many of the procedural and substantive requirements placed upon public utility holding companies by PUHCA 1935 have been repealed. The burden of oversight of the financial transactions of public utility companies, including mergers and acquisitions, now falls more heavily on the Federal Energy Regulatory Commission (FERC). FERC's oversight authority over public utilities, previously established in the Federal Power Act (FPA) and the Natural Gas Act (NGA), was enhanced by the Energy Policy Act of 2005, which included the Public Utility Holding Company Act of 2005. This new legislation requires holding companies and their affiliates to provide the Commission (as well as state regulators) access to their books and records and also grants the Commission additional authority for oversight of holding company transactions.
In addition, the SEC, the U.S. Department of Justice (DOJ), and the Federal Trade Commission (FTC) will continue to enforce generally applicable laws as they apply to public utility holding company transactions. These laws, which were unaffected by the Energy Policy Act of 2005, prevent transactions that would substantially impede competition and can require pre-merger notification.
This report will describe the current state of federal oversight of public utility holding companies and transactions involving public utilities. It will be updated as necessary.