The IESO has proposed a new rule designed to ensure that market participants in Ontario act in ways that are within the spirit of the market rules, not just the letter of the rules. Known as a “general conduct rule,” or GCR, it would establish penalties for behaviours by market participants that are considered inappropriate even if those behaviours are not specifically forbidden in any other market rule. The IESO has initiated a stakeholder engagement process to seek input on its proposal.
APPrO has been active in the consultation and has circulated the following comments:
• APPrO does not take issue with the need to have effective regulation of wholesale market conduct, including penalties for non-compliance.
• The issue for APPrO is how best to supervise, investigate and enforce this market rule.
• The IESO proposes that that the MACD (Market Assessment and Compliance Division) carry out every stage, i.e., investigate an event or conduct, allege a violation, and then unilaterally decide whether it believes a violation has occurred.
• APPrO proposes that enforcement of the GCR should be under the supervision of the Ontario Energy Board so that a market participant who is charged with violating a general conduct rule has the right to defend itself before an independent tribunal.
APPrO has tabled a proposal including the following:
• Reflects the practice in every jurisdiction that the IESO has identified as comparable in its position papers. (None of those jurisdictions use the proposed IESO model);
• Makes use of the OEB’s adjudicative expertise that determines compliance with other conduct rules (such as those for gas and electricity retailers, and distributor/transmitter affiliate relations);
• Can be carried out within the current legislative framework; and
• Can be implemented using current MACD (Market Assessment and Compliance Division) staff resources.
Further information including more detailed papers on the positions of APPrO and other parties are available here: http://www.ieso.ca/imoweb/consult/consult_se112.asp.