IV. Broad vs. Narrow Definitions
A. Parties' Positions
Parties wanting access to confidential data propose that the term "market participant" be defined narrowly, and that "non-market participant" be defined broadly. Conversely, IOUs, who provide most of the data at issue in this proceeding, wish to limit access to their confidential data.
Edison, for example, proposes that the term "market participant" be defined expansively, and include any party - including Edison itself - which transacts or advises others how to transact in the California energy markets. When in doubt, Edison asserts, the Commission should err in favor of finding that an entity is a market participant. Edison reasons that D.06-06-066 provided that "more data than ever be open to market participants," and that the definition of "'market participant'" should include all those whose awareness of market-sensitive information could result in raising prices above competitive levels."3
By contrast, CAC/EPUC state that the Commission should construe the term "market participant" "so as to maximize the number of stakeholders that have access to confidential information, pursuant to reasonable protections."4
B. Discussion
D.06-06-066 contains a materiality requirement. The decision finds that market sensitive information is not all information with a conceivable impact, no matter how small, on the market for electricity. Rather, the decision states,
there must be a materiality standard attached to the term "market sensitive." Information only has the potential to affect the market if it is material. Immaterial information will have no impact on the market price for energy.5
. . .
Not all procurement plan and related data are market sensitive under § 454.5(g); a subset of such information meets this definition. Such information must have the potential to materially affect the market price for electricity.6
However, we are faced with a different question in this decision: we are defining "market participant," not determining what is "market sensitive." The question before us is whether the term "market participant" includes every entity that participates in the market, or whether there should be limitations. Should "market participant" only include players with the potential to use information in a material way? Should we limit the definition of "market participant" to persons and entities who will use "market sensitive" information to harm ratepayers?7
We believe Senate Bill (SB) 1488 requires that we interpret the term "market participant" narrowly, to only include those persons and entities who could use market sensitive information to cause harm to the market or gain an advantage in the market. SB 1488, which we interpreted in D.06-06-066, states that
The Public Utilities Commission shall initiate a proceeding to examine its practices under Sections 454.5 and 583 of the Public Utilities Code and the California Public Records Act . . . to ensure that the commission's practices under these laws provide for meaningful public participation and open decision making.
In D.06-06-066, we stated that we would "start with a presumption that information should be publicly disclosed and that any party seeking confidentiality bears a strong burden of proof."8
It is consistent with the presumption in D.06-06-066 that we define the term "market participant" narrowly. It makes no sense, for example, to include in the definition every person and entity that buys or sells electricity, since this would include virtually everyone, including residential customers. No one argues that residential customers could, if in possession of "market sensitive" information, use it to harm ratepayers or materially impact the market price of electricity.
In our view, it is illogical to define "market participant" to include every entity that buys or sells power at wholesale (or retail), no matter how de minimis its participation. While such an entity clearly "participates" in the market, we do not believe the Legislature intended to protect "market sensitive" information if its recipient could not use it to interrupt normal market forces. Indeed, Edison concedes this point: "'market participant'" should include all those whose awareness of market-sensitive information could result in raising prices above competitive levels."9
Thus, the following criteria, at a minimum, should apply to any determination of who is and is not a market participant. (We add additional criteria later in this decision and summarize all criteria in the ordering paragraphs.)
Does the person/entity seeking access to market sensitive information have the potential to materially affect the price paid or received for electricity if in possession of such information? An entity will be considered not to have such potential if:
a) the person or entity's participation in the California electricity market is de minimis in nature. In the resource adequacy proceeding (R.05-12-013) it was determined in D.06-06-064 § 3.3.2 that the resource adequacy requirement should be rounded to the nearest megawatt (MW), and load serving entities (LSEs) with local resource adequacy requirements less than 1 MW are not required to make a showing. Therefore, a de minimis amount of energy would be less than 1 MW of capacity per year, and/or an equivalent of energy; and/or
b) the person or entity has no ability to dictate the price of electricity it purchases or sells because such price is set by a process over which the person or entity has no control, i.e., where the prices for power put to the grid are completely overseen by the Commission, such as subject to a standard offer contract or tariff price. A person or entity that currently has no ability to dictate the price of electricity it purchases or sells under this section, but that will have such ability within one year because its contract is expiring or other circumstances are changing, does not meet this exception.
3 Edison opening comments at 1.
4 CAC/EPUC reply comments at 2. See also CMTA opening comments at 2.
5 D.06-06-066, mimeo., p. 40.
6 Id., ordering paragraph 12.
7 As a threshold matter, the fact that "market participant" is not mentioned in § 454.5(g) does not alter our view that we are required to interpret the term and limit access by market participants to market sensitive information. We found in D.06-06-066 that,
The Legislature's concern about protecting the confidentiality of "market sensitive" information logically includes restrictions on access to data for those who operate in that "market." Thus, it is appropriate and lawful under § 454.5(g) to make distinctions between non-market participants and market participants in determining whether to grant access to confidential data.
8 Id., p. 2.
9 Edison opening comments at 1 (emphasis added).
