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Last-minute amendments prompt fresh debate over bill that would expand state power grid

The bill that would revise how California regulates the state power grid was amended late last week, prompting a fresh round of debate over the fate of the legislation.

The new language posted online Saturday gives lawmakers nine months to consider how specifically the California Energy Commission would expand the electric grid to as many as 14 western states.

The amendments also do away with a requirement that additional renewable-energy sources be constructed in California, a section that was added early this year to win support from organized labor.

The changes came as the state Legislature scrambles to consider hundreds of bills before the legislative session expires Friday. They also came even though a Senate analysis is unable to say whether the proposal would raise or lower utility rates.

Sen. Toni Atkins, D-San Diego, the Senate leader who will decide whether the bill will advance to a floor vote, did not respond Monday to questions about the changes. Assemblyman Chris Holden, D-Pasadena, who authored the bill, also did not respond to questions.

But supporters of the expanded-grid concept said the amendments will help convince wavering lawmakers to support the so-called regional grid.

“We think the amendments are improvements to the bill and will improve its prospects further,” said Ralph Cavanagh, an attorney with the Natural Resources Defense Council. “The amendment guarantees that the California Legislature will have a full opportunity to review and evaluate the final governance proposal.”

Cavanagh and other supporters say expanding the state power grid into a multistate network will improve efficiency and allow California to sell excess solar and wind power to other states.

Opponents say the plan is fatally flawed because it would do away with California’s direct oversight of its own power grid and turn regulation over to Trump administration appointees who are less committed to renewable energy sources.

The nine-month review provision does little to give lawmakers control over what the Energy Commission eventually develops as a new governance model for the proposed regional grid, they said.

“The new proposal is just a ‘heads up – we filed a report’,” said Barry Moline of the California Municipal Utilities Association. “It shuts out forever the California Legislature from future grid decisions. These amendments do nothing beneficial, may be misleading, and are like putting lipstick on a pig.”

The multistate grid will permit power industry insiders to import less climate-friendly electricity like coal and natural gas-generated power into California and bill ratepayers the cost of new transmission lines, Moline said.

“This will allow private companies outside California to build thousands of miles of transmission lines to benefit other states and hand Californians billions of dollars in higher bills,” he said.

Jon Wellinghoff, a former federal energy regulator who has been lobbying to pass the regional-grid plan, called the 270-day provision a fair compromise for lawmakers worried about not being in a position to respond to the energy commission plan.

“I know the legislature was concerned that the energy commission could act alone,” he said.

But Loretta Lynch, who served as the California Public Utilities Commission president during the 2001 energy crisis, said the nine-month notification provision does not resolve the issue of turning over control of the power grid to out-of-state special interests.

“It does not actually give legislators a full and fair opportunity to review what the energy commission comes up with,” Lynch said. “It puts a ticking clock on the legislature and it will jam up the new governor.”

The western grid idea has been a top priority of Gov. Jerry Brown for the past three years. Similar bills were defeated in 2016 and 2017 because lawmakers were afraid of unintended consequences related to giving up state authority to appoint board members of the grid manager, known as the California Independent System Operator or CAISO.

Under the Holden bill, Assembly Bill 813, CAISO would join a regional body that would manage electricity flow across as many as 14 states. The California governor would lose the ability to appoint CAISO board members.

The bill directs the energy commission to develop a governance model over the next two years, then notify the Governor’s Office and legislature. No additional vote would be required.

The energy commission said it would cost $37,500 to implement the law – an amount opponents said showed that the review would be perfunctory. Supporters said any additional costs could come from the existing energy commission budget

Earlier this month, a state Senate analysis concluded that there was not enough detail in the legislation to determine whether the proposal would save utility consumers money – or raise electricity rates like the time state lawmakers deregulated the California electricity market.

“In the near term, the costs associated with implementing this bill for involved departments are fairly straightforward,” the analysis concluded. “However, the ultimate fiscal effect on the state as a utility ratepayer is less clear. Various studies exist that suggest both utility rate increases as well as potential savings.”

The bill faces a Friday deadline to pass or fail.