BILL NUMBER: ABX2 28 ENROLLED
BILL TEXT
PASSED THE ASSEMBLY SEPTEMBER 13, 2001
PASSED THE SENATE SEPTEMBER 12, 2001
AMENDED IN SENATE AUGUST 21, 2001
AMENDED IN SENATE JULY 12, 2001
AMENDED IN SENATE JUNE 21, 2001
INTRODUCED BY Assembly Members Migden, Oropeza, and Diaz
(Coauthor: Assembly Member Cohn)
MAY 17, 2001
An act to amend Section 335 of, and to add and repeal Sections
341.6, 342, and 9613 of, the Public Utilities Code, relating to
public utilities.
LEGISLATIVE COUNSEL'S DIGEST
AB 28, Migden. Electrical restructuring: Oversight Board:
Independent System Operator.
(1) The existing restructuring of the electrical services industry
within the Public Utilities Act provides for the establishment of an
Independent System Operator and a Power Exchange as separately
incorporated public benefit nonprofit corporations. An Electricity
Oversight Board (Oversight Board) is also established to oversee the
Independent System Operator and the Power Exchange in order to ensure
the success of electric industry restructuring and to ensure a
reliable supply of electricity in the transition to a new market
structure. The Oversight Board is granted various powers in order to
carry out these purposes.
This bill would authorize the Oversight Board to investigate any
matter related to the wholesale market for electricity to ensure that
the interests of California's citizens and consumers are served,
protected, and represented in relation to the availability of
electric transmission and generation, and related costs, during
periods of peak demand. The bill would delete a provision relating
to the authority of the Oversight Board to exercise the exclusive
right to decline to confirm the appointments of the governing board
of the Independent System Operator.
The bill, until January 1, 2003, or the occurrence of a specified
event, whichever is earlier, would authorize the Oversight Board to
direct the inspection or reproduction of records of the Independent
System Operator or the Power Exchange. The bill would authorize the
Oversight Board to direct the Independent System Operator to report
to the Oversight Board, as specified. The bill would enact
confidentiality requirements and procedures applicable to information
provided in this regard. The bill would require the Public
Utilities Commission to treat specified information received from the
Oversight Board in accordance with a prescribed confidentiality
provision, the violation of which provision would make certain
commission officers or employees guilty of a misdemeanor. By
creating a new crime, the bill would impose a state-mandated local
program.
The bill, until January 1, 2003, or the occurrence of a specified
event, whichever is earlier, would require that electric generation
and transmission facilities be subject to various standards related
to their availability. The bill would require the Oversight Board,
in consultation with the commission and the Independent System
Operator, to prepare and adopt protocols for the scheduling of
transmission and generation equipment outages for the purpose of
maintenance, repair, or upgrade and to prepare and adopt a schedule
of outages in accordance with those protocols. The bill would
require the Oversight Board to direct the Independent System Operator
to develop and submit to the Oversight Board and the commission
proposed generation facility maintenance, operating, and availability
standards for generator units with a certain capacity. The bill
would authorize the commission to adopt those standards and ensure
compliance with those standards. The bill would require entities
that own or operate certain electric generating units to provide
reports on a monthly basis to the Independent System Operator that
identify any periods the units were unavailable to produce
electricity or were available at reduced capacity. The bill would
require the Independent System Operator to transmit that information
to the Oversight Board and the commission.
The bill would also impose certain requirements on electrical
corporations having contracts with certain qualifying facilities or
cogeneration facilities. The bill would require a report of the
operational status and availability of the facility to be provided to
the Oversight Board and the commission on a daily basis. The bill
would provide for the assessment of penalties by the commission for
violations of these provisions. Because a violation of the Public
Utilities Act is a crime under existing provisions of law, the bill
would create a state-mandated local program by expanding the
definition of a crime.
The bill, until January 1, 2003, or the occurrence of a specified
event, whichever is earlier, would impose various duties on local
publicly owned electric utilities and certain other local public
entities relative to maintenance of certain generation and
transmission facilities, and reporting of actual planned and
nonplanned outages of facilities, thereby imposing a state-mandated
local program.
The bill would require the Oversight Board to report to the
Legislature in writing on a quarterly basis on its progress in
implementing the provisions of this bill.
The bill would provide that its provisions shall become operative
only if SB 39 of the Second Extraordinary Session of 2001-02 is
enacted and becomes effective.
(2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement, including the creation of a State Mandates Claims Fund
to pay the costs of mandates that do not exceed $1,000,000 statewide
and other procedures for claims whose statewide costs exceed
$1,000,000.
This bill would provide that with regard to certain mandates no
reimbursement is required by this act for a specified reason.
With regard to any other mandates, this bill would provide that,
if the Commission on State Mandates determines that the bill contains
costs so mandated by the state, reimbursement for those costs shall
be made pursuant to the statutory provisions noted above.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 335 of the Public Utilities Code is amended to
read:
335. In order to ensure that the interests of the people of
California are served, a five-member Electricity Oversight Board is
hereby created as provided in Section 336. For purposes of this
chapter, any reference to the Oversight Board shall mean the
Electricity Oversight Board. Its functions shall be all of the
following:
(a) To oversee the Independent System Operator and the Power
Exchange.
(b) To determine the composition and terms of service and to
exercise the exclusive right to decline to confirm the appointments
of specific members of the governing board of the Power Exchange.
(c) To serve as an appeal board for majority decisions of the
Independent System Operator governing board, as they relate to
matters subject to exclusive state jurisdiction, as specified in
Section 339.
(d) Those members of the Power Exchange governing board whose
appointments the Oversight Board has the exclusive right to decline
to confirm include proposed governing board members representing
agricultural end users, industrial end users, commercial end users,
residential end users, end users at large, nonmarket participants,
and public interest groups.
(e) To investigate any matter related to the wholesale market for
electricity to ensure that the interests of California's citizens and
consumers are served, protected, and represented in relation to the
availability of electric transmission and generation and related
costs, during periods of peak demand.
SEC. 2. Section 341.6 is added to the Public Utilities Code, to
read:
341.6. (a) The Oversight Board may direct the inspection or
reproduction of records, data, accounts, books, or documents of the
Independent System Operator or the Power Exchange that are reasonably
related to the public interest of the people of California,
including, but not limited to, the reliability, availability, and
cost of electric service to California consumers.
(b) The Oversight Board may direct the Independent System Operator
to report to the Oversight Board on those matters and at those times
as the Oversight Board determines are necessary and appropriate to
the exercise of its public oversight duties.
(c) Information received by the Oversight Board pursuant to this
section shall be held in confidence by the Oversight Board or
aggregated to the extent necessary to assure confidentiality if
public disclosure of the specific information or data would result in
unfair competitive disadvantage to the person supplying the
information.
(d) (1) Whenever the Oversight Board receives a request to
publicly disclose unaggregated information, notice of the request or
proposal shall be provided to the person submitting the information
to the Oversight Board through the Independent System Operator. The
notice shall indicate the form in which the information is to be
released. Upon receipt of notice, the person submitting the
information shall have 10 working days in which to respond to the
notice to justify the claim of confidentiality on each specific item
of information covered by the notice on the basis that public
disclosure of the specific information would result in unfair
competitive disadvantage to the person supplying the information.
(2) The Oversight Board shall consider the respondent's submittal
in determining whether to publicly disclose the information submitted
to it for which a claim of confidentiality is made. The Oversight
Board shall issue a written decision that sets forth its reasons for
making the determination whether each item of information for which a
claim of confidentiality is made shall remain confidential or shall
be publicly disclosed.
(e) The Oversight Board may not make public disclosure of
information submitted to it pursuant to this section until 10 working
days after the Oversight Board has issued its written decision
required in this section.
(f) No information submitted to the Oversight Board pursuant to
this section shall be deemed confidential if the person submitting
the information or data has made it public.
(g) With respect to information submitted by the Independent
System Operator to the Oversight Board pursuant to this section,
neither the Oversight Board nor any employee of the Oversight Board
shall do any of the following:
(1) Use the information furnished to the Oversight Board for any
purpose other than the purpose for which it is supplied.
(2) Make any publication whereby the information furnished by any
particular entity or individual to the Independent System Operator
can be identified.
(3) Permit anyone other than members or employees of the Oversight
Board to examine the information.
(h) The Oversight Board shall disclose to the commission any
information requested by the commission for the purpose of
implementing this division. The commission shall treat information
received pursuant to this section in accordance with Section 583 and
shall specifically provide for the confidentiality of records and
protection of propriety information. With respect to the information
it receives from the Oversight Board, the commission shall be
subject to the pertinent provisions of this section.
(i) The Oversight Board may adopt emergency regulations to
implement this section in accordance with the Administrative
Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1
of Division 3 of Title 2 of the Government Code). The adoption of
emergency regulations pursuant to this section shall be deemed an
emergency and considered by the Office of Administrative Law as
necessary for the immediate preservation of the public peace, health,
and safety, or general welfare.
(j) This section shall remain in effect until the earlier of
either of the following occurs, and as of that date is repealed:
(1) (A) A determination is made and notice thereof is provided
pursuant to subparagraph (B).
(B) Upon a determination by the Attorney General that the
Oversight Board has been abolished, or merged with, or replaced by,
another agency, or that the functions of the Oversight Board have
been duplicated by statute, executive order, or otherwise, the
Attorney General shall submit a notice of that determination to the
Secretary of State, and this section shall be repealed upon the
receipt of that notice by the Secretary of State.
(2) January 1, 2003.
SEC. 3. Section 342 is added to the Public Utilities Code, to
read:
342. (a) The Legislature finds and declares that electric
generation and transmission facilities are critical infrastructure
and their predictable availability is essential to the public
welfare.
(b) Electric generation and transmission facilities shall be
subject to standards related to their availability, in accordance
with this section.
(c) Owners or operators of electric generating facilities in the
State of California shall comply with all protocols and standards
approved or established pursuant to this chapter.
(d) On or before March 1, 2002, the Oversight Board, in
consultation with the commission and the Independent System Operator,
shall prepare and adopt protocols for the scheduling of transmission
and generation equipment outages for the purposes of maintenance,
repair, or upgrade.
(e) The Oversight Board, in consultation with the commission and
the Independent System Operator, shall prepare and adopt a schedule
of transmission and generation equipment outages according to the
protocols adopted pursuant to subdivision (d).
(f) The Oversight Board shall direct the Independent System
Operator to develop and submit to the Oversight Board and the
commission proposed generation facility maintenance, operating, and
availability standards for generator units with a rated maximum
capacity of 10 megawatts or greater. The Oversight Board shall adopt
and may, as necessary, make revisions to, the standards. In
developing standards, the Oversight Board and the Independent System
Operator shall take into consideration generation facilities
scheduled for retirement and valid warranties on generation
facilities. The commission may adopt these standards and ensure
compliance with these standards of owners and operators of generation
facilities subject to its jurisdiction. Nothing in this subdivision
shall be construed to limit the commission's authority to develop
facility maintenance, operating, and availability standards for
generation facilities under the commission's jurisdiction.
(g) Nothing in this section shall result in the modification,
delay, or abrogation of any deadline, standard, rule, or regulation
adopted by a federal, state, or local agency for the purposes of
protecting public health or the environment, including, but not
limited to, any requirements imposed by the State Air Resources Board
or by an air pollution control district or an air quality management
district pursuant to Division 26 (commencing with Section 39000) of
the Health and Safety Code. The Oversight Board shall consult with
the State Air Resources Board and the appropriate local air pollution
control districts and air quality management districts to coordinate
scheduled outages to provide for compliance with those retrofits.
(h) The Independent System Operator shall maintain records of
generation facility outages and shall provide those records, and any
additional information as determined by the Oversight Board, to the
Oversight Board and the commission on a daily basis. Each entity
that owns or operates an electric generating unit in California with
a rated maximum capacity of 10 megawatts or greater, shall provide a
monthly report to the Independent System Operator that identifies any
periods during the preceding month when the unit was unavailable to
produce electricity or was available only at reduced capacity. The
report shall identify the reasons for any such unscheduled
unavailability or reduced capacity. The Independent System Operator
shall immediately transmit the information to the Oversight Board and
the commission.
(i) The commission, in consultation with the Oversight Board,
shall adopt a penalty schedule applicable to any person or entity who
is in violation of any provision of this article.
(j) The Oversight Board may request the commission to undertake
proceedings related to assessing monetary penalties for
noncompliance. Nothing in this subdivision shall be construed to
limit the commission's authority to initiate its own action for
noncompliance.
(k) The Oversight Board, in consultation with the commission, may
seek an injunction from a court of competent jurisdiction to require
compliance with this section. This subdivision shall not limit any
authority of the commission to seek injunctions within its
jurisdiction.
(l) Except as provided in Section 9613, notwithstanding any other
provision of law, neither the provisions of this section, nor any
rules, regulations, standards, or protocols issued in furtherance of
this section, nor the penalties described in subdivisions (i) and
(j), shall apply to any of the following:
(1) A local publicly owned electric utility, as defined in
subdivision (d) of Section 9604.
(2) Any public agency that may generate electricity incidental to
the provision of water or wastewater treatment.
(m) (1) Except as otherwise provided in this subdivision, this
section shall not apply to nuclear powered generating facilities that
are federally regulated and subject to standards developed by the
Nuclear Regulatory Commission, and that participate as members of the
Institute of Nuclear Power Operations.
(2) The owner or operator of a nuclear powered generating facility
shall file with the Oversight Board and the commission an annual
schedule of maintenance, including repairs and upgrades, updated
quarterly, for each generating facility. The owner or operator of a
nuclear powered generating facility shall make good faith efforts to
conduct its maintenance in compliance with its filed plan and shall
report to the Oversight Board any significant variations from its
filed plan.
(3) The owner or operator of a nuclear powered generating facility
shall report on a monthly basis to the Oversight Board and the
commission all actual planned and unplanned outages of each facility
during the preceding month. The owner or operator of a nuclear
powered generating facility shall report on a daily basis to the
Oversight Board the daily operational status and availability of each
facility.
(n) (1) Except as otherwise provided in this subdivision, this
section shall not apply to a qualifying small power production
facility or a qualifying cogeneration facility within the meaning of
Sections 201 and 210 of Title II of the federal Public Utility
Regulatory Policies Act of 1978 (16 U.S.C.A. Secs. 796(17), 796(18),
and 824a-3), and the regulations adopted pursuant to those sections
by the Federal Energy Regulatory Commission (18 C.F.R. Secs. 292.101
to 292.602, inclusive), nor shall this section apply to other
generation units installed, operated, and maintained at a customer
site exclusively to serve that customer's load.
(2) An electrical corporation that has a contract with a
qualifying small power production facility, or a qualifying
cogeneration facility, with a name plate rating of 10 megawatts or
greater shall report to the Oversight Board and the commission
maintenance schedules for each facility, including all actual planned
and unplanned outages of the facility and the daily operational
status and availability of the facility. Each facility with a name
plate rating of 10 megawatts or greater shall be responsible for
directly reporting to the Oversight Board maintenance schedules for
each facility, including all actual planned and unplanned outages of
the facility and the daily operational status and availability of the
facility, if that information is not provided to the electrical
corporation pursuant to a contract.
(o) This section shall remain in effect until the earlier of
either of the following occurs, and as of that date is repealed:
(1) (A) A determination is made and notice thereof is provided
pursuant to subparagraph (B).
(B) Upon a determination by the Attorney General that the
Oversight Board has been abolished, or merged with, or replaced by,
another agency, or that the functions of the Oversight Board have
been duplicated by statute, executive order, or otherwise, the
Attorney General shall submit a notice of that determination to the
Secretary of State, and this section shall be repealed upon the
receipt of that notice by the Secretary of State.
(2) January 1, 2003.
SEC. 4. Section 9613 is added to the Public Utilities Code, to
read:
9613. (a) Each local publicly owned electric utility, or public
agency that may generate electricity incidental to the provision of
water or wastewater treatment, shall file with the Oversight Board an
annual schedule of maintenance, updated quarterly, for all
generation units with a rated maximum capacity of 10 megawatts or
greater and all transmission facilities. A local publicly owned
electric utility, or public agency that may generate electricity
incidental to the provision of water or wastewater treatment, shall
make good faith efforts to conduct its maintenance in compliance with
its filed plan and shall report to the Oversight Board any
significant variations from its filed plan.
(b) Each local publicly owned electric utility, or public agency
that may generate electricity incidental to the provision of water or
wastewater treatment that owns or operates generation units with a
rated maximum of 10 megawatts or greater or transmission facilities
shall report on a monthly basis to the Oversight Board all actual
planned and unplanned outages of those generating units and
transmission facilities during the preceding month.
(c) Each local publicly owned electric utility, or public agency
that may generate electricity incidental to the provision of water or
wastewater treatment, that owns or operates generation units with a
rated maximum of 10 megawatts or greater or transmission facilities
shall adopt standards for the maintenance of those generating units
and transmission facilities. Each local publicly owned electric
utility, or public agency that may generate electricity incidental to
the provision of water or wastewater treatment, shall file its
standards with the Oversight Board. Each local publicly owned
electric utility, or public agency that may generate electricity
incidental to the provision of water or wastewater treatment, shall
report the daily operational status and availability of its
generation units with a rated maximum of 10 megawatts and its
transmission facilities to the Oversight Board on a daily basis.
(d) This section shall remain in effect until the earlier of
either of the following occurs, and as of that date is repealed:
(1) (A) A determination is made and notice thereof is provided
pursuant to subparagraph (B).
(B) Upon a determination by the Attorney General that the
Oversight Board has been abolished, or merged with, or replaced by,
another agency, or that the functions of the Oversight Board have
been duplicated by statute, executive order, or otherwise, the
Attorney General shall submit a notice of that determination to the
Secretary of State, and this section shall be repealed upon the
receipt of that notice by the Secretary of State.
(2) January 1, 2003.
SEC. 5. The Oversight Board shall report in writing to the
appropriate policy committees of the Legislature on a quarterly basis
on its progress in implementing this act. The report shall include,
but need not be limited to, information concerning outage scheduling
and coordination, compliance with standards by owners of generating
and transmission facilities, and wholesale price fluctuations.
SEC. 6. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution for certain
costs that may be incurred by a local agency or school district
because in that regard this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.
However, notwithstanding Section 17610 of the Government Code, if
the Commission on State Mandates determines that this act contains
other costs mandated by the state, reimbursement to local agencies
and school districts for those costs shall be made pursuant to Part 7
(commencing with Section 17500) of Division 4 of Title 2 of the
Government Code. If the statewide cost of the claim for
reimbursement does not exceed one million dollars ($1,000,000),
reimbursement shall be made from the State Mandates Claims Fund.
SEC. 7. This act shall become operative only if Senate Bill 39 of
the Second Extraordinary Session of 2001-02 is enacted and becomes
effective.