UNITED STATES OF AMERICA BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION Material Changes in Facts Underlying Waiver of Order No. 889 and Part 358 of the Commission s Regulations Docket Nos. AD09-7-000 TS07-3-000 REPORT TO COMMISSION OF MATERIAL CHANGE IN FACTS AND LAW CONCERNING WAIVER GRANTED TO SOUTHERN CALIFORNIA EDISON COMPANY IN DOCKET TS07-3-000 Pursuant to the Order of the Federal Energy Regulatory Commission ( FERC or Commission issued May 21, 2009 1 in Docket AD09-7-000, Southern California Edison Company ( SCE hereby informs the Commission that SCE no longer qualifies for the partial waiver of Standards of Conduct granted to SCE in Docket TS07-3-000. I. BACKGROUND: 2007 WAIVER REQUEST On February 26, 2007, SCE filed with the Commission a very limited request for partial waiver of the Standards of Conduct as modified by Order 2004 ( Waiver Request. Specifically, SCE requested that the non-affiliated requirement for consenting parties under section 358.5(b(4 of the Order 2004 Standards of Conduct be waived. Then-section 358.5(b(4 stated: 1 Order Clarifying Requirement To Notify Commission Of Material Changes In Facts And Allowing 45-Day Filing Period For Notifications, 127 FERC 61,141 (issued May 21, 2009. See Ordering Paragraph A ( Any public utility that has received a waiver of Order No. 889 or the Standards of Conduct is hereby directed to notify the Commission if there has been a material change in facts that may affect the waiver.. - 1 -
A non-affiliated transmission customer may voluntarily consent, in writing, to allow the Transmission Provider to share the non-affiliated customer s information with a Marketing or Energy Affiliate. If a non-affiliated customer authorizes the Transmission Provider to share its information with a Marketing or Energy Affiliate, the Transmission Provider must post notice on the OASIS or Internet website of that consent along with a statement that it did not provide any preferences, either operational or rate-related, in exchange for that voluntary consent. 2 SCE requested the waiver because one of SCE s affiliates intended to bid into SCE s competitive solicitation ( Request for Offers or RFO. As SCE pointed out in its Waiver Request, SCE had been ordered by the California Public Utilities Commission ( CPUC to conduct the RFO, and in doing so, to evaluate all bids affiliated and unaffiliated on the same basis. 3 Furthermore, the CPUC had set up various safeguards, including requiring utilities to retain an Independent Evaluator to monitor the process when affiliates intended to bid into the RFO. Additionally, at the time SCE was requesting the waiver, FERC had issued a Notice of Proposed Rulemaking 4 that stated an intention of facilitating Integrated Resource Planning, 5 such as was contemplated by the CPUC in requiring the RFO. On June 11, 2007, the Commission granted SCE s request for partial waiver of the Standards of Conduct, 6 finding that [A]llowing affiliated customers the same opportunity [to voluntarily consent to have their information shared with the Marketing Affiliate] does not violate the purpose or spirit of the standards of conduct since express consent is provided and posted. To do otherwise, would put the energy affiliate at a disadvantage with respect to non-affiliated customers as it relates to the RFOs. 7 Thus, SCE was permitted to share affiliated bidders information with the Marketing Affiliate employees conducting the RFO. 2 18 CFR 358.5(b(4 (the Consent Exemption (emphasis added as it existed in February 2007 (pre-order 717. 3 CPUC Decision 06-07-029 (http://162.15.7.24/published/final_decision/58268.htm. 4 Notice of Proposed Rulemaking, 118 FERC 61,031 (2007. 5 Id. at PP 54-60. 6 Order On Request For Partial Exemption From the Standards Of Conduct, 119 FERC 61,270 (2007. 7 Id. at P 8. - 2 -
II. CHANGE IN CIRCUMSTANCES DISQUALIFYING SCE FROM USE OF WAIVER On October 16, 2008, the Commission issued Order 717, 8 which substantially revised the Standards of Conduct in such a way that SCE no longer qualifies for the waiver granted in Docket TS07-3-000. Specifically, Order 717 eliminated the concept of Energy Affiliates, and revised the definition of Marketing Functions such that the SCE employees who conduct RFOs are no longer considered Marketing Function Employees ( MFEs. Therefore, in accordance with the revised Standards, these RFO employees may now have access to both Non-Public Transmission Function Information and customer information. Additionally, the regulatory text of the Standards of Conduct was revised in Order 717 such that the consent exemption previously found in section 358.5(b(4 no longer exists. Therefore, due to the change in the Standards of Conduct themselves and the resultant change in SCE RFO employee classification under the Standards, SCE no longer qualifies for, or requires, the waiver granted by the Commission. III. CONCLUSION Because of the modifications to the Standards of Conduct effected by Order 717, SCE no longer qualifies for the waiver granted by the Commission in Docket TS07-3-000. Furthermore, due to the reclassification of employees under the revised Standards, SCE no longer requires the waiver. 8 Standards of Conduct for Transmission Providers, 125 FERC 61,064 (2008. - 3 -
Respectfully submitted, JENNIFER R. HASBROUCK ERIN K. MOORE By: Erin K. Moore Attorneys for SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California 91770 Telephone: (626 302-6848 Facsimile: (626 302-3540 E-mail: erin.moore@sce.com Dated: July 14, 2009-4 -
CERTIFICATE OF SERVICE I hereby certify that I have this day served the foregoing REPORT TO COMMISSION OF MATERIAL CHANGE IN FACTS AND LAW CONCERNING WAIVER GRANTED TO SOUTHERN CALIFORNIA EDISON COMPANY IN DOCKET TS07-3-000 upon each person designated on the official service list compiled by the Secretary in this proceeding. Dated at Rosemead, California, this 14 th day of July, 2009. Case Analyst SOUTHERN CALIFORNIA EDISON COMPANY 2244 Walnut Grove Avenue Post Office Box 800 Rosemead, California 91770