Regulated energy sector entities routinely submit confidential and proprietary business information to Texas state agencies, including the Railroad Commission (Texas’s incongruously named oil and gas regulator), the General Land Office, the Public Utility Commission, and the Electric Reliability Council of Texas (“ERCOT”), often assuming it is “for regulators’ eyes only.” But Texas agencies have limited power to prevent the disclosure of information sought pursuant to the Public Information Act (“PIA”).
The PIA, codified in Chapter 552 of the Texas Government Code, is heavily weighted toward public disclosure, perhaps even more so than the federal Freedom of Information Act. Under the PIA, all information held by governmental bodies in Texas is presumed to be public. Even if a governmental body determines that requested information should be withheld to protect the privacy or property interests of a third party, it must seek an opinion from the Attorney General’s office. If the Attorney General disagrees with the agency’s assessment, the agency will typically release the information, and the burden will remain with the third party whose interests are implicated to file suit against the Attorney General to stop the disclosure (assuming jurisdictional requirements are otherwise satisfied.)
The PIA’s broad scope presents several challenges for energy businesses seeking to protect their confidential information. It is thus essential for energy sector businesses to (1) retain experienced counsel to monitor state agency notifications regarding PIA requests, and (2) timely file objections to disclosure requests.
The PIA defines “public information” broadly as “information that is written, produced, collected, assembled, or maintained under a law or ordinance or in connection with the transaction of official business:
- by a governmental body;
- for a governmental body and the governmental body:
- owns the information;
- has a right of access to the information; or
- spends or contributes public money for the purpose of writing, producing, collecting, assembling, or maintaining the information; or
- by an individual officer or employee of a governmental body in the officer’s or employee’s official capacity and the information pertains to official business of the governmental body.”
Tex. Gov. Code § 552.002(a). “Official business,” in turn, means “any matter over which a governmental body has any authority, administrative duties, or advisory duties.” Id. §552.003(2-a).
The PIA applies to all Texas entities that are supported in whole or in part by public funds; accordingly, all the Texas regulatory agencies impacting the energy sector are covered by the PIA, with the notable exception of ERCOT. The Attorney General has opined that ERCOT does not fall within the scope of the PIA due to ERCOT’s unique structure as an independent, membership-based, non-profit organization subject to the direct regulatory oversight of the Public Utility Commission. See OAG Letter Ruling OR2021-13253. (Nevertheless, the Public Utility Commission has established specific information disclosure regulations that ERCOT must follow—energy sector businesses that submit data to ERCOT would be wise to consult them.)
Members of the public face few procedural hurdles to filing a PIA request for energy company-specific regulatory information. Accordingly, most energy sector regulatory submissions are likely to be fair game for requestors.
Given the PIA’s broad scope, the potential for exposure of energy companies’ sensitive business information is far from trivial. The PIA sets forth several exceptions to disclosure, however, that a company may invoke in seeking to protect its confidential information. Among the most cited ones by energy companies are:
- Section 552.101: information made confidential by other law, e.g., common law of privacy, attorney-client privilege, attorney work product, and applicable federal and state constitutional provisions, statutes, and regulations.
- Section 552.110(b): information that constitutes a trade secret.
- Section 552.110(c): commercial/financial information the disclosure of which would cause substantial competitive harm to the person from whom the information was obtained.
- Section 552.1101: confidential proprietary information of a vendor or contractor that, if disclosed, would give advantage to a competitor or would reveal an individual approach to work, organizational structure, staffing, internal operations, processes, or pricing methodology.
- Section 552.113: geological or geophysical information, including well logs, maps, and related information (unless filed in connection with an application or proceeding before an agency).
- Section 552.131: information related to economic development negotiations involving a governmental body and a business prospect.
- Section 552.133: information relating to a public power utility’s competitive activity.
Energy companies seeking to invoke any of the above-mentioned exceptions must pay close attention to the PIA’s multiple deadlines. The PIA sets forth a multi-step process that agencies must follow when they receive a request that implicates a third party’s proprietary information. First, the agency must disclose information promptly in response to a PIA request. If the disclosure will take more than 10 business days, the entity must so certify to the requestor.
If the agency believes that any responsive information should be withheld from disclosure, it must request a ruling from the Attorney General within 10 business days and state the exceptions that may apply. Within 10 business days of its ruling request, the agency must provide notice to any third parties with a proprietary interest in the requested information. Within 15 business days of its ruling request, the agency must submit written comments to the Attorney General, along with a copy of the specific information requested or a representative sample of such information.
Within 10 business days of receiving notice from the agency, a third party may submit comments to the Attorney General arguing against disclosure. The Attorney General must issue a letter ruling within 45 business days of receiving a ruling request from an agency. If either a public body or an affected third party disagrees with the Attorney General’s letter ruling, it may sue to block the disclosure within 30 calendar days of receiving the letter ruling (assuming jurisdictional requirements are otherwise satisfied).
The limited exceptions and tight deadlines create challenges for energy companies in developing an effective response to a PIA request. For example, although third parties must receive notice of any PIA request that implicates their proprietary information, they do not necessarily know prior to the response deadline which information the agency has deemed to be responsive.
Given the PIA’s broad scope and strict deadlines, retaining experienced counsel to monitor and respond to PIA notices from state regulatory agencies is the most effective way for energy sector business to prevent erroneous or damaging disclosures of information. Counsel can coordinate with the agency’s legal department as needed and file timely and cogent objections with the Attorney General’s office.