D0705032 - Appendix A - Order Modifying D0606066
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Decision 07-05-032 May 3, 2007

Before The Public Utilities Commission Of The State Of California

Order Instituting Rulemaking to Implement Senate Bill No. 1488 (2004 Cal. Stats., Ch. 690 (Sept. 22, 2004)) Relating to Confidentiality of Information.

Rulemaking 05-06-040

(Filed June 30, 2005)




By this order, we address the applications for rehearing of Decision (D.) 06-06-066, filed jointly by the Cogeneration Association of California and the Energy Producers and Users Coalition (collectively, "CAC/EPUC"), and The Utility Reform Network ("TURN").

D.06-06-066 is an interim decision in Phase I of Rulemaking (R.) 05-06-040, the Order Instituting Rulemaking to Implement Senate Bill (SB) No. 1488 Relating to Confidentiality of Information.1 The Legislature in SB 1488 directed us to examine our practices with respect to the requirements of the California Public Records Act ("CPRA") and Public Utilities Code sections 454.5(g) and 583.2

Section 583 is one of the foundational statutes concerning the Commission and is a procedural means for utilities to claim confidentiality of information provided to the Commission. Section 454.5 was enacted in 2002, in the aftermath of the 2000-2002 energy crisis and following the collapse of the state's Power Exchange ("PX"). It requires electric corporations to file their procurement plans with the Commission. The CPRA, enacted in 1968, mandates that all records maintained at public agencies are public records and provides a process to facilitate the public's access to those records. (Gov. Code § 6250, et seq.) Though records filed with the Commission may be public, the CPRA grants us discretionary authority to exempt numerous records from public disclosure. The Legislature's directive to us in section 454.5(g) is to ensure the confidentiality of market sensitive information, and is an expression of the public interest in nondisclosure of confidential market sensitive information.

D.06-06-066 clarifies that the burden is on the entity claiming confidentiality of information submitted to the Commission to prove why such information should not be disclosed to the public. Among other things, D.06-06-066 adopts a matrix process that establishes a procedure in accordance with section 454.5(g), for determining whether information is entitled to confidential treatment because it is market sensitive.3 Under D.06-06-066 market sensitive information that is confidential will remain protected from public disclosure generally for up to three years. D.06-06-066 establishes a process whereby non-market participant intervenors may obtain access to confidential market sensitive information provided they first enter into a confidentiality agreement and/or submit to a protective order.

Cogeneration Association of California and the Energy Producers and Users Coalition (jointly, "CAC/EPUC") and The Utility Reform Network ("TURN") timely filed applications for rehearing of D.06-06-066.

In their joint rehearing application, CAC/EPUC contend D.06-06-066 errs: (1) by concluding that section 454.5 mandates a distinction in treatment of market and non-market participants regarding access to confidential market sensitive information; (2) by failing to make any findings of fact or conclusions of law or to cite any record evidence that disclosure of confidential information to market participants has caused or will cause harm to ratepayers; (3) by denying all "stakeholders" affected by a Commission decision access to the information upon which the decision is based; (4) by disregarding and conflicting with the Public Utility Regulatory Policies Act ("PURPA") of 1978, Title16 United States Code section 824a-3 and the regulations promulgated there under regarding public inspection of utilities' avoided costs; and (5) by failing to appropriately balance "meaningful participation" and open decision-making with use of protective procedures for confidential information that provide all "stakeholders" with the ability to meaningfully participate in the decision-making process and result in open decision-making. CAC/EPUC do not challenge the Commission's use and protection of confidential information. Rather they challenge the absolute prohibition of access to market sensitive information that the Commission will use in reaching a decision in electric procurement proceedings by those deemed to be "market participants," as well as denial of a process provided to other "stakeholders," regardless of whether they are parties or a segment of the public.

TURN takes issue with the investor owned utilities ("IOU") matrix established by D.06-06-066, arguing that sections B and E of Part VII of it are inconsistent and unlawful. TURN contends that these portions of the IOU matrix are unlawful under section 454.5(g) because they require utilities to make their proposed or executed power purchase agreements public three years after the start of delivery even if delivery under the contract is still occurring. In addition, TURN argues that requiring contract summaries to be made public immediately would provide market participants with a means of determining a utility's net short position and thus create conflict with sections VI, subsections A and B of the matrix which provide that the bundled service net short for capacity and energy will not be publicly disclosed for three years, rendering the decision arbitrary and capricious.

San Diego Gas & Electric Company ("SDG&E") filed a response (in the form of "comments") opposing CAC/EPUC's application. SDG&E also supports TURN's application for rehearing. CAC/EPUC filed a joint response opposing TURN's application.

We have carefully reviewed the arguments raised by TURN and are of the opinion that good cause has not been established for granting rehearing. We have also carefully reviewed the arguments raised by CAC/EPUC and are of the opinion that some of the language in D.06-06-066 may be causing some confusion and by this order we have modified D.06-06-066 accordingly; however, we are of the opinion that good cause has not been established for granting CAC/EPUC's application for rehearing of D.06-06-066 as modified herein. Accordingly, the applications for rehearing of D.06-06-066 as modified by this decision are denied.

1 SB 1488, passed in September 2004, provides: "The Public Utilities Commission shall initiate a proceeding to examine its practices under [s]ections 454.5 and 583 of the Public Utilities Code and the California Public Records Act (Chapter 3.5 (commencing with [s]ection 6250) of Division 7 of Title 1 of the Government Code) to ensure that the [C]ommission's practices under these laws provide for meaningful public participation and open decisionmaking." (2004 Cal.Stats., Ch. 690, § 1 (Sept. 22, 2004), emphasis added.)

We note that we recently issued D.06-12-030 in R.05-06-040. Rehearing applications challenging this decision are pending. We note that today's decision in no way disposes of or prejudges those applications for rehearing of D.06-12-030, which this Commission will subsequently be disposing of.

2 All statutory references are to the Public Utilities Code unless otherwise indicated.

3 In order to be considered to be "market sensitive information" it "must have the potential to materially affect an electricity buyer's market price for electricity." (D.06-06-066 at p. 41.) "Information is material if it affects the market price an energy buyer pays for electricity." (D.06-06-066 at p. 42.)

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