The regional RTOs were established primarily to enable short-term and long-term reliability within their respective territories. This is accomplished through certain functions including measuring and monitoring of activity, the balancing of supply and demand, coordination of maintenance, and oversight of the long-term growth strategy of the network. The RTOs themselves do not own or operate any of the transmission assets. Instead they work directly with the transmission owners operating within their jurisdiction. Those entities which are users of the transmission grid or are impacted by its performance include power generation companies and retail distributors as well as investor entities which choose to trade on aspects of the power market.

Transmission owners are required to comply with RTO and FERC regulations when offering transmission services to their customers. Utilities receive regulatory approval for their Open Access Transmission Tariff (OATT), which represents the services available and terms established for all contractual arrangements involving use of the grid. The OATT also sets the pricing for the services provided. The OATT rate is determined based on the expected total cost, both direct and indirect, of moving electricity between generating plants and substations, plus an approved return on equity. Transmission operators are typically regulated public utilities and therefore, accounting for transmission tariffs (billing, collection, cost deferral, etc.) may qualify for application of the guidance in ASC 980. The facts and circumstances of the respective arrangements however, must be considered before applying the standard.