BILL ANALYSIS
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THIRD READING
Bill No: SB 655
Author: Padilla (D)
Amended: 5/20/09
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 9-2, 4/21/09
AYES: Padilla, Calderon, Corbett, Kehoe, Lowenthal,
Simitian, Strickland, Wiggins, Wright
NOES: Benoit, Cox
SENATE APPOPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Independent System Operator: transmission
facilities
SOURCE : Author
DIGEST : This bill specifies that the state laws
regarding consumer and environmental facilities laws which
the Independent System Operator, operates include but are
not limited to, the California Renewable Portfolio Standard
Program and the California Global Warming Solutions Act of
2006. This bill requires the operator to appear annually
before appropriate policy committees of the Legislature to
report on the operator's activities. The bill also
declares legislative intent that the operator ensure that
the transmission grid is secure from unauthorized
intrusion.
ANALYSIS : Current law creates the Independent System
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Operator (ISO) as a nonprofit, public benefit corporation.
To ensure the reliability of electric service and the
health and safety of the public, the ISO is charged with
managing the transmission grid in a manner that is
consistent with making the most efficient use of energy
resources; reducing overall economic cost to customers, and
applicable state law intended to protect the public's
health and the environment. The ISO is also required to
consult and coordinate with appropriate state and local
agencies to ensure that it operates in furtherance of state
consumer and environmental protection laws.
Background
The ISO was established when the electric market was
deregulated in 1996. Control of the electric grid was
transferred from the investor-owned utilities (IOUs) to the
ISO because of concerns that the utilities would favor
their own electric generation facilities over those
facilities owned by others. The ISO's self-articulated
mission includes promoting environmental stewardship. The
ISO's brochures note that it reduces barriers for renewable
energy to access the electric grid and that it will help
California achieve its 20 percent renewable portfolio
standard. The ISO performs several discrete functions.
They dispatch electricity, perform a needs analysis on
proposed transmission lines, and conduct auctions for the
purchase of electricity needed to meet immediate and
near-term needs.
Recent reports indicate that the electric grid has been
hacked. Investigators found that the hackers left behind
software that could later be activated to disrupt grid
operations. Most alarmingly, the hacking was apparently
discovered not by the grid operators, but by U.S.
intelligence agencies. There was no indication whether
California's grid was hacked, though because of the
interconnectedness of the entire western grid that may not
matter. The ISOs governing statutes discuss grid
reliability but not grid security.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
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SUPPORT : (Verified 5/26/09)
American Federation of State, County and Municipal
Employees, AFL-CIO
Southern California Edison
Union of Concerned Scientists
DLW:do 5/26/09 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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