Walwyn Ruling Adopting Amended Protective Order and Severing an Issue for Hearing

CMW/k47 1/14/2004

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Order Instituting Rulemaking to Establish Policies and Cost Recovery Mechanisms for Generation Procurement and Renewable Resource Development.

Rulemaking 01-10-024

ADMINISTRATIVE LAW JUDGE'S RULING

ADOPTING AMENDED PROTECTIVE ORDER

AND SEVERING AN ISSUE FOR HEARING

This Ruling adopts an Amended Protective Order pursuant to the undersigned's Ruling of December 1, 2003, which directed the parties to comment on, and which directed San Diego Gas & Electric Company (SDG&E) to provide a draft revised Protective Order, consistent with the Amended Protective Order that the Federal Energy Regulatory Commission's (FERC) Administrative Law Judge (ALJ) McCartney issued in FERC Docket Nos. EL02-60-003 and EL02-62-003, which would allow attorneys and/or outside experts, who are not competitive duty personnel for their clients, to gain access to Protected Materials in this case that are relevant to the SDG&E Request for Proposals (RFP).

This Ruling also severs from the evidentiary hearing on SDG&E's RFP, which is scheduled to commence in the above-entitled matter on February 9, 2004, the issue of SDG&E's request for reallocation of the Sunrise contract as a condition of the approval of the Calpine Purchase Power Agreement (PPA).

Amended Protective Order

In the undersigned's December 1, 2003 Ruling on SDG&E's Motion to Amend Protective Order (December 1 Ruling), SDG&E was directed within 10 days of the filing of that Ruling to provide a draft revised Protective Order, incorporating the concepts embodied in the Amended Protective Order that the FERC ALJ McCartney issued in FERC Docket Nos. EL02-60-003 and EL02-62-003, so as to allow attorneys and/or outside experts, who are not competitive duty personnel for their clients, to gain access to Protected Materials in this case that are relevant to the SDG&E RFP. The December 1 Ruling also directed the parties to submit comments, within 15 days of the filing of the Ruling, on how the concepts embodied in the FERC Amended Protective Order could best be incorporated into the Protective Order that until now has been in effect in this proceeding in order to allow attorneys and/or outside experts, who are not competitive duty personnel for their clients, to gain access to Protected Materials in this case that are relevant to the SDG&E RFP, and to confer on, and coordinate in, the preparation of the revised version of the Protective Order to be submitted by SDG&E.

On December 5, 2003, SDG&E circulated to the parties via e-mail a draft of a revised version of the Protective Order to reflect the revision required by the December 1 Ruling. In SDG&E's view, the proposed revisions to the Protective Order captured the spirit and intent of the December 1 Ruling "...to allow attorneys and/or consultants to a MPP who do not perform any competitive duties ... to have access to Protected Materials relevant to the SDG&E RFP." In this e-mail, SDG&E requested the parties to inform it if any further revisions were necessary to comply with the December 1 Ruling, and informed the parties that this draft revision was being reviewed internally within SDG&E, and that any substantial changes triggered by that internal review would be circulated a.s.a.p. for further comment.

SDG&E received a few responses to its December 5 e-mail, and incorporated some of the recommended changes into the proposed Amended Protective Order that it submitted on December 11, 2003. SDG&E did not incorporate other suggested revisions, because, in SDG&E's view, they did not seem necessary. The proposed Amended Protective Order that SDG&E submitted on December 11, 2003 did not wholly rewrite the then-applicable Protective Order to track the FERC order, although it did provide the access to Protected Materials in this case that are relevant to the SDG&E RFP to attorneys and/or outside experts, who are not competitive duty personnel for their clients. Thus, the proposed Amended Protective Order that SDG&E submitted on December 11, 2003 did accomplish the purpose that the December 1 Ruling sought to be achieved and will accordingly be adopted in this Ruling.

A number of the parties commented in writing on SDG&E's December 11 proposed Amended Protective Order.

PG&E and Southern California Edison Company (SCE) urged that a "FERC Model" Protective Order under which market participants would be able to obtain access to protected materials no be adopted, although Pacific Gas and Electric Company (PG&E) agreed that the guidelines proposed by SDG&E in its December 11 submittal were "reasonable." For the reasons articulated in the December 1 Ruling, we decline to accommodate PG&E's and SCE's requests that a "FERC Model" Protective Order not be adopted for the purposes of review by the parties of SDG&E's RFP.

By contrast, the Independent Energy Producers Association (IEP) and The Cogeneration Association of California and The Energy Producers and Users Coalition (CAC/EPUC) criticize SDG&E's proposed Amended Protective Order for not going far enough to allow for "meaningful participation in this proceeding by Market Participants," and they suggest concepts and/or language that, in their view, would achieve this purpose. However, we disagree that the revisions suggested by IEP and CAC/EPUC are necessary to achieve the requisite degree of openness and transparency to enable the Market Participating Parties to have reasonable access to the Protected Materials contained in SDG&E's RFP filing. To the contrary, SDG&E's proposed Amended Protective Order provides to the Reviewing Representatives of the Market Participating Parties effectively the same degree of access to such materials as is granted to the Reviewing Representatives of the Non-Market Participating Parties.

IEP and CAC/EPUC should recognize that the adoption of SDG&E's proposed Amended Protective Order will give them all of the insight into the results of SDG&E's RFP process that are under review in this proceeding that they need in order to be on an effectively equal footing with the non-market parties that are participating in this review. More than this, they should not expect, or demand.