 United States Court of Appeals
         FOR THE DISTRICT OF COLUMBIA CIRCUIT



Argued May 10, 2006                    Decided July 18, 2006

                        No. 02-1367

    CONSTELLATION ENERGY COMMODITIES GROUP, INC.,
                     PETITIONER

                             v.

       FEDERAL ENERGY REGULATORY COMMISSION,
                    RESPONDENT

   CALIFORNIA POWER EXCHANGE CORPORATION, ET AL.,
                    INTERVENORS


                     Consolidated with
                 03-1285, 05-1094, 05-1154


          On Petitions for Review of Orders of the
          Federal Energy Regulatory Commission



    David C. Frederick argued the cause for petitioners
Constellation Energy Commodities Group, Inc., Powerex Corp.,
and supporting intervenors. With him on the briefs were Scott
H. Angstreich, Paul W. Fox, Andrea M. Kearney, Ronald N.
Carroll, John T. Stough, Jr., Kevin M. Downey, Charles V.
Garcia, James C. Beh, Jeffrey M. Jakubiak, Robert C.
McDiarmid, Daniel I. Davidson, and Lisa G. Dowden.
                               2

    Richard L. Roberts argued the cause for petitioner Southern
California Edison Company and intervenor Pacific Gas and
Electric Company. With him on the briefs were Catherine M.
Giovannoni, Melanie J. Teplinsky, Stephen E. Pickett, Michael
D. Mackness, Julie A. Miller, Mark D. Patrizio, Joseph H.
Fagan, and Stan Berman. Paul B. Mohler entered an
appearance.

     Lona T. Perry, Attorney, Federal Energy Regulatory
Commission, argued the cause for respondent. With her on the
brief were John S. Moot, General Counsel, and Robert H.
Solomon, Solicitor.

     David C. Frederick, Scott H. Angstreich, Paul W. Fox,
Andrea M. Kearney, and Ronald N. Carroll were on the brief for
intervenors in support of respondent.

     Richard L. Roberts, Catherine M. Giovannoni, Melanie J.
Teplinsky, Stephen E. Pickett, Michael D. Mackness, Julie A.
Miller, Erik N. Saltmarsh, Mary F. McKenzie, Traci Bone, Mark
D. Patrizio, Joseph H. Fagan, and Stan Berman were on the
brief for intervenors California Electricity Oversight Board, et
al. in support of respondent. Arocles Aguilar, Sean H.
Gallagher, and Victoria S. Kolakowski entered appearances.

    Before: GINSBURG, Chief Judge, and TATEL and GARLAND,
Circuit Judges.

    Opinion for the Court filed by Chief Judge GINSBURG.

     GINSBURG, Chief Judge: The bankruptcy of the California
Power Exchange Corporation (the CalPX or the PX) in March
2001 gave rise to several proceedings before the Federal Energy
Regulatory Commission and to the orders before us today.
Petitioners Constellation Energy Commodities Group, Inc. and
                                3

Powerex Corporation (“the sellers”)* argue the Commission
misinterpreted the CalPX tariff to allow the PX to retain
collateral they had posted with it, and Powerex individually
challenges the Commission’s decision allowing the PX to retain
its so-called “chargeback” payments. Petitioner Southern
California Edison Company and intervenor Pacific Gas and
Electric Company (“the purchasers”) claim the Commission has
not allowed the PX to retain sufficient collateral. Because we
conclude the Commission acted reasonably in all respects, we
deny the petitions for review.

                         I. Background

     We pick up the “long, detailed, and tortured” history of the
California energy crisis in the mid-1990s when, in an attempt to
deregulate its energy markets, the State of California created the
CalPX and the California Independent System Operator
Corporation (CAISO). Bonneville Power Admin. v. FERC, 422
F.3d 908, 911 (9th Cir. 2005). The CAISO is responsible for
managing the flow of electricity on the electric grid across the
State and runs a “spot” market for electricity. The now-defunct
CalPX ran an auction market for electricity in which participants
bought and sold power in “day-ahead” and “day-of” markets
subject to the conditions of the CalPX tariff. In particular, the
CalPx tariff required each participant to maintain with the PX
collateral sufficient to cover its outstanding liabilities from the
time “the liabilities are incurred” until “payment is billed and
settled.” CalPX Tariff § 2.2.

     Beginning in the summer of 2000 many purchasers’
liabilities skyrocketed due to the increased rates they paid for


        *
         Although the parties could both buy and sell power in the
CalPX markets, we use the terms “sellers” and “purchasers” to
describe the petitioners’ roles relevant to this case.
                                4

power. Bonneville, 422 F.3d at 912. San Diego Gas and
Electric Company, a purchaser in the CalPX market, filed a
complaint with the Commission alleging these rates were unjust
and unreasonable, in violation of 16 U.S.C. § 824d(a). See San
Diego Gas & Elec. Co. v. Sellers of Energy & Ancillary Servs.
into Markets Operated by the [CAISO] & the [CalPX], 93
F.E.R.C. ¶ 61,294, at 61,983 (2000). The Commission
investigated, agreed, and “condition[ed] continued approval of
market-based rates on the seller agreeing to refund” any amount
it had charged in excess of the maximum just and reasonable
rate from October 2, 2000 to June 20, 2001 (the refund period).*
Id. at 61,999, 62,010-11; Powerex Corp. v. Cal. Power Exch.
Corp., 102 F.E.R.C. ¶ 61,328, at 62,121 (2003) (Powerex
Order).

     Edison and PG&E were unable, however, under state law,
to pass on to their retail customers the increased rates they had
paid for power purchased through the PX. As a result, the two
companies together defaulted on more than a billion dollars of
debt to the PX and others. Pac. Gas & Elec. Co. v. Cal. Power
Exch. Co., 95 F.E.R.C. ¶ 61,020, at 61,041 (2001) (2001
Chargeback Order). The CalPX then sought to recover the
unpaid amounts under the “chargeback” provision of its tariff,
“an allocation mechanism intended to allow the PX to recover
the uncollected receivables of a defaulting PX debtor” from the
other, non-defaulting participants. Powerex Order, 102
F.E.R.C. at 62,120 n.3.



        *
         The refund period began 60 days after the rates were first
challenged as unjust and unreasonable and ended when the
Commission began “constraining prices” in the power markets. See
San Diego Gas & Elec. Co. v. Sellers of Energy and Ancillary Serv.
into Markets Operated by the [CAISO] & the [CalPX], 96 F.E.R.C. ¶
61,120, at 61,502, 61,504 (2001).
                                5

     Several participants balked at the demand made by the
CalPX and turned to the Commission for relief. In April 2001,
the Commission concluded that charging other participants in
order to satisfy PG&E’s and Edison’s debts would “cause
virtually all PX participants to default.” 2001 Chargeback
Order, 95 F.E.R.C. at 61,045. The Commission therefore
directed the PX to: “(1) rescind all chargeback actions related to
PG&E’s and SoCal Edison’s liabilities; and (2) refrain from
taking any future chargeback action related to” those liabilities
until the Commission had ruled on other complaints related to
the bankruptcy. Id. at 61,046.

     Meanwhile, in March 2001, the CalPX had filed for
bankruptcy protection under Chapter 11 of the Bankruptcy
Code, 11 U.S.C. §§ 101, et seq., and the following month
suspended operations in its markets. Constellation Power
Source, Inc. v. Cal. Power Exch. Corp., 100 F.E.R.C. ¶ 61,124,
at 61,482 (2002) (Constellation Order). In 2002 Constellation
filed a complaint with the Commission seeking release of the
collateral it had posted with the CalPX pursuant to § 2.2 of the
CalPX tariff. Constellation maintained its liabilities to the PX
had been “billed and settled” -- the precondition in § 2.2 for the
release of collateral -- when it paid its last invoice for debts
incurred in the markets that closed in 2001. Allowing the PX to
keep the collateral, Constellation argued, would convert the
collateral “into a guaranty of payment” for any liability the
Commission might assign Constellation as a result of the refund
proceedings, thus contravening both the “CalPX’s tariff and the
Commission policy” against requiring guaranties for refunds.
Id.

     The Commission denied Constellation’s complaint, holding
that, “given the numerous ongoing contested proceedings
regarding the transactions that occurred in the PX markets,” the
“final billing and settlement” of Constellation’s liabilities had
                                  6

“not yet taken place.” Id. at 61,486. The agency reasoned:

      [We are] ... faced with circumstances that were not
      contemplated when the Commission approved the
      ‘billed and settled’ provision of the CalPX tariff. The
      CalPX is no longer operating and therefore cannot
      adjust future bills when outstanding liabilities are
      finally determined ....

      Under these unusual circumstances, the Commission
      finds that retaining the collateral is in the public
      interest because [the Commission is] enforcing the
      terms of the tariff to assure that all market participants
      meet their outstanding obligations and the ultimate
      CalPX creditors are paid.

Id.

     Constellation petitioned for rehearing, reiterating the
arguments raised in its complaint and pointing out the
Commission had not addressed its alternative proposal that the
PX release all but the amount of collateral necessary to cover the
refunds still pending. See Constellation Power Source, Inc. v.
Cal. Power Exch. Corp., 100 F.E.R.C. ¶ 61,380, at 62,697
(2002) (Constellation Rehearing Order). The Commission
accepted Constellation’s alternative proposal and ordered the
CalPX to release all but $10 million of Constellation’s collateral
-- a “conservative estimate” of the amount needed “to cover
[Constellation’s] potential refund liability.” Id.

    Edison and PG&E then each petitioned for further
rehearing. Both argued that, because the CalPX’s accounts were
“subject to many ongoing controversies,” $10 million might not
cover the refunds for which Constellation ultimately could be
found liable. Constellation Power Source, Inc. v. Cal. Power
                               7

Exch. Corp., 111 F.E.R.C. ¶ 61,147, at 61,778 (2005)
(Constellation Second Rehearing Order). The Commission
rejected their petitions, explaining that it had “t[aken] into
account the fact that potential refunds may increase” and “used
the most conservative estimates” before determining that $10
million would be sufficient. Id. at 61,778-79.

     Powerex also joined the fray, filing a complaint with the
Commission seeking from the CalPX (1) the release of its
collateral, and (2) the return of the chargeback payments it had
made when PG&E and Edison defaulted. Powerex Order, 102
F.E.R.C. at 62,121. In March 2003 the Commission concluded,
as it had in the Constellation Order, that Powerex’s liabilities
were not yet “billed and settled” because the refund proceedings
were not complete. Id. at 62,124. In contrast to its decision in
the Constellation Rehearing Order, however, the Commission
refused to order the CalPX to release any of Powerex’s collateral
because it could not determine “whether Powerex’s collateral
exceeds its potential refund liability.” Id. at 62,123.

     As for the chargeback payments, the Commission deferred
consideration of Powerex’s request pending resolution of the
petitions for rehearing of the 2001 Chargeback Order. See id.
at 62,124. In October 2004 it determined the return of all
chargeback funds “should wait until a final computation” in the
refund proceedings: “In the event that there is a shortfall of
payments due from sellers, the shortfall may need to be
allocated such that a seller with chargebacks that are being held
by the PX[] may not be entitled to the entire amount previously
paid.” Pac. Gas & Elec. Co. v. Cal. Power Exch. Corp., 109
F.E.R.C. ¶ 61,027, at 61,114 (2004 Chargeback Order). The
Commission explained that, although some participants had paid
their chargebacks in cash, others had “paid” by accepting
reduced payments of monies due from the CalPX; the latter
group could not be “reimbursed” until the PX’s accounts were
                                 8

settled. Only by waiting until the refund proceedings were
complete, therefore, could the Commission ensure the two
groups “w[ould] be treated similarly.” Id. at 61,114 n.30.

     Powerex petitioned for rehearing. The Commission
rejected its claims but clarified that the chargeback funds would
be retained “only until the individual PX account of the PX
participant that made a chargeback payment is resolved in the
Refund Proceedings”; “the chargeback funds held by the PX are
not to be used to make up any general shortfall” caused by
another participant’s default. Coral Power, L.L.C. v. Cal. Power
Exch., 110 F.E.R.C. ¶ 61,288, at 62,108 (2005) (2005
Chargeback Order). Constellation, Powerex, and Edison each
petition for review of one or more of the Commission’s orders.

                           II. Analysis

     Both sellers argue the Commission’s interpretation of the
CalPX tariff is unreasonable and contrary to precedent; Powerex
also challenges the Commission’s orders denying the release of
its chargeback funds. As intervenors in the case brought by
Edison, the sellers challenge Edison’s standing and defend the
Commission’s release of Constellation’s collateral.

     The purchasers argue the Commission’s decision releasing
all but $10 million of Constellation’s collateral (1) conflicts with
the CalPX tariff, (2) is not supported by substantial evidence,
and (3) conflicts with Commission precedent. As intervenors in
the case brought by the sellers, the purchasers argue the sellers
lack standing and their petitions are moot; the purchasers also
support on their merits the Commission’s decisions allowing the
PX to retain the sellers’ collateral and Powerex’s chargeback
funds.

    The Commission maintains several arguments raised by the
                                 9

sellers are jurisdictionally barred because they were not raised
before the agency. In the alternative, the Commission defends
its orders on their merits.

     As always, we will set aside a decision of the Commission
only if it is arbitrary and capricious or otherwise contrary to law.
Envtl. Action, Inc. v. FERC, 939 F.2d 1057, 1061 (D.C. Cir.
1991). Because we conclude the Commission rationally
interpreted and implemented the CalPX tariff, we do not disturb
the orders under review.

A. Justiciability

    As stated, Edison and the sellers challenge each other’s
standing to petition for review. The facts relevant to standing,
however, are not in dispute; rather, each side impugns the legal
significance of the facts marshaled by the other in support of its
standing.

     First, Edison and PG&E claim that, because the
Commission approved the sellers’ requests to offset against their
eventual refund obligations the costs they incur to keep their
collateral posted with the PX, the sellers’ petitions are moot and
they lack the injury in fact necessary to support their standing,
see Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992).
The sellers reply that the “posting costs are not the only source
of ... injury from the [PX’s] retention of their collateral”;
because “credit pledged in one market cannot be utilized
productively in other markets,” their business opportunities are
limited.

    Our caselaw makes clear the sellers’ claims are justiciable:
A “present injurious effect on [a petitioner’s] business
decisions,” Rio Grande Pipeline Co. v. FERC, 178 F.3d 533,
540 (D.C. Cir. 1999), is a cognizable injury in fact and presents
                                10

a live controversy within the “case or controversy” limitation of
Article III of the Constitution of the United States. See Fund for
Animals, Inc. v. Hogan, 428 F.3d 1059, 1065 (D.C. Cir. 2005).

     For their part, the sellers argue Edison lacks standing
because its alleged injury -- the release of Constellation’s
collateral will “make it more difficult ... to recover refunds from
Constellation” -- is speculative and not imminent. See
Defenders of Wildlife, 504 U.S. at 560 (requiring that injury be
“actual or imminent, not ‘conjectural’ or ‘hypothetical’”).
Edison responds with decisions from two sister circuits holding
the loss of an interest in collateral constitutes an immediate
injury in fact. See In re Paxton, 440 F.3d 233, 236 (5th Cir.
2006); Motorola Credit Corp. v. Uzan, 388 F.3d 39, 55 (2d Cir.
2004).

     We agree with Edison that the increased risk of non-
recovery inherent in the reduction of collateral securing a debt
of uncertain amount is sufficient to support its standing. As
detailed below, Constellation’s ultimate liability to the PX has
not been settled, and Edison claims that, without access to the
released collateral, it lacks the security of repayment guaranteed
to participants by § 2.2 of the CalPX tariff. Cf. Bankers Trust
Co. v. Old Republic Ins. Co., 959 F.2d 677, 682 (7th Cir. 1992)
(victim of “insured’s tort” has “legally protectable interest” in
tortfeasor’s policy even before he has obtained judgment upon
claim). In these circumstances, and considering Edison’s
legitimate interest in obtaining redress for any unjust or
unreasonable rates it paid, we conclude its claimed interest in
the collateral satisfies the standing requirements of Article III.

B. The Sellers’ Petitions

    Section 2.2 of the CalPx tariff, the proper interpretation of
which is in dispute, provides in relevant part:
                                 11

    Each PX Participant shall maintain sufficient collateral
    to cover its aggregate outstanding liabilities in the Day-
    Ahead and Day-Of Markets to and from the PX
    between cash clearing cycles or during the period in
    which the liabilities are incurred and when payment is
    billed and settled.

CalPX Tariff § 2.2. Our review of the Commission’s
interpretation of a filed tariff is analogous to our review of the
agency’s interpretation of a statute it administers. See Chevron,
U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837,
842-43 (1984). First, we determine whether the tariff is
ambiguous; if it is not, then the Commission must adhere to its
plain meaning. FPL Energy Marcus Hook, L.P. v. FERC, 430
F.3d 441, 446 (D.C. Cir. 2005). If the tariff is ambiguous,
however, then we defer to the Commission’s interpretation so
long as it is reasonable, regardless whether it seems to us the
best interpretation. Williams Natural Gas Co. v. FERC, 3 F.3d
1544, 1551 (D.C. Cir. 1993).

1. The plain meaning of the tariff

     The sellers first argue “the plain meaning and structure of
the CalPX tariff unambiguously establish” that the “liabilities”
for which the PX could require collateral per § 2.2 have already
been “billed and settled.” In support of this argument, the
sellers cite various other provisions of the tariff that, they claim,
by putting it in context show the plain meaning of § 2.2. The
Commission, in response, maintains the sellers’ argument is not
properly before the court because in arguing before the
Commission they “never cited ... any other provisions of the PX
tariff now cited in their brief.” See 16 U.S.C. § 825l(b) (“No
objection to the order of the Commission shall be considered by
the court unless such objection shall have been urged before the
Commission in the application for rehearing unless there is
                               12

reasonable ground for failure so to do”).

     The Commission is correct. The sellers did not make this
argument before the agency and in fact never even cited the
sections of the tariff upon which they now rely for the
interpretation of § 2.2. Accordingly, we have before us no
cognizable argument that “the period in which ... payment is
billed and settled” plainly does not remain open until the
Commission determines the sellers’ liability for refunds.

2. A reasonable interpretation

     The sellers next argue the Commission’s interpretation of
the tariff “cannot be sustained because it is unreasonable.”
Specifically, they claim the Commission’s conclusion that their
accounts will not be “billed and settled” until the pending refund
proceedings are complete conflicts with “settled ... precedent”
in which the Commission has refused, absent “extraordinary
circumstances,” to require a party to provide a guaranty for
potential refund obligations. See, e.g., Distrigas of Mass. Corp.,
33 F.E.R.C. ¶ 61,406, at 61,776 (1985).

     The Commission, defending its interpretation as consistent
with precedent, notes that in Distrigas and similar cases it
“denied requests for bond or escrow requirements to secure
refund obligations for rates that had been set for hearing.” Here,
in contrast, it did “not requir[e] a guaranty for the payment of
refunds, but rather enforc[ed] the terms of the PX tariff
regarding retention of collateral.” As the Commission explained
in the order under review, even after the CalPX closed its
markets it continued to issue new invoices to reflect adjustments
to and revisions of transactions dating as far back as August
2000, and “[t]he amount of Constellation’s outstanding liability
[to the CalPX was] not yet known.” Constellation Order, 100
F.E.R.C. at 61,486.
                                  13

     We think the Commission’s position that the sellers’
liabilities have not yet been “billed and settled” is both
reasonable and consistent with precedent: Certainly decisions
such as Distrigas in no way precluded the parties from entering
into an agreement -- more properly from maintaining and
accepting a tariff -- that provides billing and settlement would
not take place, and consequently collateral would be required,
until any refund proceedings were complete.

     Indeed, we believe the Commission reasonably concluded
the parties did just that, with the result that the sellers’ liabilities
for transactions during the refund period will not be “settled”
until the Commission determines the maximum just and
reasonable price at which they could lawfully sell power during
the refund period.            Furthermore, the Commission’s
interpretation, which will help ensure “market participants meet
their outstanding obligations and the ultimate CalPX creditors
are paid,” id., is consistent with both the text of § 2.2, which
nowhere limits which liabilities must be collateralized, and the
general purpose of the provision requiring that market
transactions be secured. In sum, we believe the Commission
reasonably concluded the sellers’ total liabilities to the CalPX
had not yet been “billed and settled”; consequently it did not err
in permitting the PX to retain the sellers’ collateral. See
Williams Natural Gas Co., 3 F.3d at 1551.

3. The CAISO market

     The sellers next argue the Commission, when it refused to
direct the PX to release their collateral, “violated the CalPX
tariff” by considering transactions in the CAISO market with
respect to which the sellers did not use the PX as their
scheduling coordinator. As the sellers note, § 2.2 of the tariff
requires collateral solely for obligations incurred “to and from
the PX,” and the only way in which a seller in the CAISO
                                14

market could incur an obligation “to ... the PX” was to use the
CalPX as its scheduling coordinator.

     The Commission maintains we may not consider this
argument because the sellers failed to raise it before the agency.
Constellation, however, claims it did raise the issue in the
petition for rehearing where it argued for limited liability
“[e]ven if its potential refunds to the ISO are considered (as they
should not be).” Powerex similarly points to a footnote in its
petition for rehearing, in which it asserted that “collateral held
by the CalPX never was intended ... to operate as security for
participation in markets outside of the CalPX, such as markets
operated by the CAISO.”

     Each quoted passage states a conclusion; neither makes an
argument. Parties are required to present their arguments to the
Commission in such a way that the Commission knows
“specifically ... the ground on which rehearing [i]s being
sought.” Intermountain Mun. Gas Agency v. FERC, 326 F.3d
1281, 1285 (D.C. Cir. 2003). Although each seller mentioned
the CAISO, neither claimed, either as a matter of fact or of law,
that it had not incurred liability to the PX with respect to any
transaction in the CAISO market. Absent such a claim, the
Commission had no reason to disregard the sellers’ transactions
in the CAISO market, and we cannot entertain the sellers’
belated argument to the contrary. See 16 U.S.C. § 825l(b).

4. Chargeback

    Finally, Powerex contends the Commission “violated the
CalPX tariff” by allowing the PX to retain the chargeback
payments Powerex made after PG&E and Edison defaulted.
Powerex claims the tariff authorized a chargeback only to cover
the present default of another participant, whereas the
Commission is attempting to provide, by allowing the PX to
                               15

retain the chargeback payments until the refund proceedings are
complete, security against the possibility a participant might
default in the future. The Commission explained its decision
was necessary to “assure that those who paid their chargeback
through receiving a reduced payment from the PX will be
treated similarly to those who paid the chargeback in cash[;]
both will receive a similar allocation of any shortfall,”
Chargeback 2004 Order, 109 F.E.R.C. at 61,114 n.30, and
neither will be reimbursed until refund proceedings are
complete.

     Powerex urges us to reject the Commission’s invocation of
the need for equity among market participants, claiming the
Commission did not rely consistently upon that ground in its
orders. In particular, Powerex points to the Commission’s claim
in the 2005 Chargeback Order that the chargeback funds held
by the PX “may be retained only until the individual PX account
of the PX participant that made a chargeback payment is
resolved in the Refund Proceedings.” 110 F.E.R.C. at 62,108.

     It is well settled that “we defer to [the Commission’s]
decisions in remedial matters” and reject the Commission’s
choice of an equitable remedy only if it lacks a “rational basis.”
Koch Gateway Pipeline Co. v. FERC, 136 F.3d 810, 816 (D.C.
Cir. 1998). The orders in this case are not lacking. As the
Commission recognized in the 2004 Chargeback Order, those
participants that “paid” the chargeback by accepting reduced
payments from the CalPX cannot be reimbursed until the final
CalPX accounting is complete and it is clear there are no
shortfalls in the CalPX accounts to prevent full repayment. The
Commission rationally concluded those participants that paid
their chargebacks in cash should be treated in a like manner,
receiving reimbursement only after the Commission determines
there is no shortfall in their individual accounts. See
Chargeback 2004 Order, 109 F.E.R.C. at 61,114 & n.30.
                               16

     Nor, contrary to Powerex’s argument, is there any
inconsistency between the 2004 and 2005 Chargeback Orders.
Although one could read the footnote in the 2004 Chargeback
Order (quoted above) to allow the CalPX to use one
participant’s chargeback funds to offset a shortfall caused by
another, that is by no means the only reasonable interpretation.
As the Commission suggests, the more natural reading is that the
2004 Chargeback Order simply delays reimbursement until
each participant’s account is settled and the extent of each
participant’s shortfall, if any, has been determined, thereby
treating similarly those participants that paid in cash and those
that paid by receiving reduced amounts from the PX. So
understood, the 2005 Chargeback Order clarifies, but does not
contradict, the 2004 Chargeback Order. Because the orders
consistently offer a “rational basis” for delaying reimbursement
of the chargeback payments, Koch Gateway Pipeline Co., 136
F.3d at 816, we will not disturb the orders under review.

C. The Purchasers’ Challenges

     The purchasers launch several attacks on the Commission’s
decision to release a portion of Constellation’s collateral.
Constellation Second Rehearing Order, 111 F.E.R.C. at 61,778-
79. First, they claim it conflicts with “every other case on
point,” citing La Paloma Generating Co., LLC v. California
Independent System Operator Corp., 110 F.E.R.C. ¶ 61,386
(2005) (La Paloma Order); Powerex Order, 102 F.E.R.C. ¶
61,328; and PG&E Energy Trading-Power, L.P. v. California
Power Exchange Corp., 102 F.E.R.C. ¶ 61,091 (2003) (PGET
Order). Next, they argue the decision is not supported by
substantial evidence because: The Commission (1) cited no
record evidence, study, or calculation showing $10 million was
a “conservative estimate”; (2) without explanation, did not use
the mechanism in the CalPX tariff for calculating the amount of
collateral needed; and (3) disregarded evidence Edison
                                17

presented demonstrating Constellation’s refund liabilities were
“likely to increase substantially due to ongoing litigation.”
Finally, the purchasers maintain the Commission erred in
relying upon the estimated refund figures provided by
Constellation without itself testing them.

     The Commission defends its order as consistent with
precedent and supported by substantial evidence. To begin, the
Commission contends the allegedly contrary decisions cited by
the purchasers are not inconsistent with the orders challenged
here; in those decisions the Commission refused to release
collateral expressly because it was unable to determine whether
the collateral would exceed the sellers’ potential refund
liabilities -- a determination it was able to make in
Constellation’s case, as explained below. Next, the Commission
claims it provided “ample justification” for allowing the PX to
retain only $10 million of collateral. As it explained in the
Constellation Second Rehearing Order, that figure was based
upon “the most conservative estimates” of Constellation’s
refund liability, taking “into account the fact that potential
refunds may increase as a result of the proposed changes to the
refund methodology.” 111 F.E.R.C. at 61,779. Finally, the
Commission maintains it properly applied the tariff: Section 2.2
required collateral to cover outstanding liabilities, and
Constellation’s only outstanding liabilities were such refunds as
may be due the CalPX. Because the Commission conservatively
estimated those refunds to be less than $10 million, it argues, it
was consistent with the tariff to release the rest.

     We do not believe the Commission erred. The allegedly
contrary decisions are, as the Commission has explained, fully
consistent with the orders in Constellation’s case. In the other
decisions the Commission either (1) was unable to calculate the
seller’s refund liability because the seller was subject to further
discovery regarding market manipulation, or (2) found the
                               18

seller’s estimated refund liability exceeded the amount of its
posted collateral. See Powerex Order, 102 F.E.R.C. at 62,123
(refund liability uncertain because Powerex still subject to
market manipulation proceedings); PGET Order, 102 F.E.R.C.
at 61,250-51 (company’s potential refund liability “substantially
exceeds the amount of its collateral”); La Paloma Order, 110
F.E.R.C. at 62,497 (refund liability not finally determined).

     Moreover, as we have long recognized, “it is within the
scope of the agency’s expertise to make ... a prediction about the
market it regulates, and a reasonable prediction deserves our
deference notwithstanding that there might also be another
reasonable view.” Envtl. Action, 939 F.2d at 1064. In this case,
the Commission explained that its decision to release a portion
of Constellation’s collateral was made after considering
Constellation’s potential refund liability under a variety of
scenarios, none of which suggested Constellation would owe
more than $4.6 million to the CalPX and the CAISO together.
Constellation Second Rehearing Order, 111 F.E.R.C. at 61,778-
79 & n.12. For a margin of safety, the Commission reasonably
required the CalPX to retain collateral worth more than double
its highest estimate of Constellation’s liability, thereby leaving
room for the increase in refund liability the purchasers are
predicting. In any event, the purchasers point to nothing in the
record suggesting the figures provided by Constellation were
erroneous or the refund required is likely to exceed $10 million.
In these circumstances we have no reason to doubt the
Commission’s considered calculation is reasonable and deserves
our deference.

                        III. Conclusion

     As the numerous orders before us attest, the Commission
was called upon to resolve a number of complex and contested
issues in the aftermath of the CalPX bankruptcy. The petitioners
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have not demonstrated that it acted unreasonably in doing so.
For the reasons stated, therefore, the petitions for review are

                                                       Denied.
