Bill S1179-2013

Relates to providing oversight and monitoring the operations of an independent system operator

Relates to providing oversight and monitoring of the operations of an independent system operator; authorizes the public service commission to provide oversight and requires annual reports of the independent system operator.

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  • Jan 8, 2014: REFERRED TO ENERGY AND TELECOMMUNICATIONS
  • Jan 9, 2013: REFERRED TO ENERGY AND TELECOMMUNICATIONS

Memo

BILL NUMBER:S1179

TITLE OF BILL: An act to amend the public service law, in relation to providing oversight and monitoring the operations of an independent system operator

PURPOSE OR GENERAL IDEA OF BILL: This legislation intended to provide consumer representation at an independent system operator approved by the United States federal energy regulatory commission to operate in the state and to administer and monitor wholesale electricity markets. The bill addresses issues related to the makeup of the Board of Directors, consumer participation in the ISO functioning process, market transparency and monitoring by the Public Service Commission.

SUMMARY OF SPECIFIC PROVISIONS: Section 1(a) provides definitions for "independent systems operator" and "end use sector member".

Section 1(b) authorizes and directs the Public Service Commission to provide oversight and monitor the market operations of an independent system operator.

Section 1(c) requires bid disclosure and bidder identification no later than three months after transactions in each of the markets facilitated by an independent systems operator.

Section 1(d) provides for appointments to an independent system operator's board of directors. The Governor and the respective leaders of the majority parties in the State Senate and Assembly will each have the authority to appoint one consumer representative to the board.

Section 1(e) requires an independent system operator to retain the services of a consumer liaison. The consumer liaison will be responsible for communicating with consumer representatives on the Board and market participants on a regular basis for the purposes of providing information on developments in working groups/sub-committees and proposals that may have ramifications on consumers. The liaison will also be responsible for communicating consumer concerns in internal independent system operator meetings.

Section 1(f) will require the Public Service Commission to monitor and assess independent system operator finances, market performance, market reliability, competition and the extent to which the markets are advancing the state's goals for fuel diversity and efficiency. The Commission will be required to report to the Legislature and the Executive at least annually.

JUSTIFICATION: The health, welfare, and prosperity of all New York residents require the provision of adequate, efficient, reliable, environmentally sound, and lowest-cost electric service at affordable prices. Many of the decisions that govern the sale, purchase and transmission of

electricity in New York State are made by a federally approved independent system operator with limited input from New York consumers.

The intent of this legislation is to recognize and remedy the fact that individual action by residential consumers, small businesses and farmers for the purposes of participating in independent system operator processes and communicating their views is rendered impracticable by reason of the disproportionate expense of taking such action.

Independent system operator proceedings are offered in a way that minimizes public participation. It is incredibly difficult for typical New Yorkers to remain on top of the day to-today activities of an independent system operator. In many instances, the only people who can attend and participate in the decision making processes of an independent system operator are most likely those whose job depends on it, representatives of generators, transmission owners, utilities and other special interests.

Requiring consumer representation on the board of directors, a consumer liaison and increased transparency will spur a more open and accountable independent system operator processes that may yield creative socially responsible solutions to the difficult issues associated with electricity markets in New York State.

PRIOR LEGISLATIVE HISTORY: S665/A6035 of 2011/2012; Referred to Energy & Telecommunications

FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None.

EFFECTIVE DATE: This act shall take effect immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 1179 2013-2014 Regular Sessions IN SENATE (PREFILED) January 9, 2013 ___________
Introduced by Sens. MAZIARZ, RITCHIE -- read twice and ordered printed, and when printed to be committed to the Committee on Energy and Tele- communications AN ACT to amend the public service law, in relation to providing over- sight and monitoring the operations of an independent system operator THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 66 of the public service law is amended by adding a new subdivision 29 to read as follows: 29. (A) FOR THE PURPOSES OF THIS SUBDIVISION: (I) "INDEPENDENT SYSTEM OPERATOR" SHALL MEAN ANY ENTITY OPERATING IN THE STATE THAT IS APPROVED BY THE UNITED STATES FEDERAL ENERGY REGULATO- RY COMMISSION TO OPERATE IN THE STATE TO ADMINISTER AND MONITOR WHOLE- SALE ELECTRICITY MARKETS; AND (II) "END USE SECTOR MEMBER" SHALL INCLUDE ANY ENTITY THAT PURCHASES ELECTRICITY FOR ITS OWN CONSUMPTION AND NOT FOR RESALE. (B) THE COMMISSIONER IS AUTHORIZED AND DIRECTED TO PROVIDE OVERSIGHT AND MONITOR THE MARKET OPERATIONS OF AN INDEPENDENT SYSTEM OPERATOR, INCLUDING BUT NOT LIMITED TO THE EXTENT TO WHICH IT: (I) SERVES THE NEEDS OF ALL CUSTOMER CLASSES AND OPERATES IN A MANNER THAT IS IN THE BEST INTEREST OF THE PUBLIC; (II) ENSURES RELIABILITY, QUALITY AND MAINTENANCE OF THE TRANSMISSION SYSTEM; (III) MEETS THE REQUIREMENTS OF THE NEW YORK STATE OPEN MEETING LAWS; AND (IV) CONTRIBUTES TO THE ACHIEVEMENT OF ENERGY EFFICIENCY AND FUEL DIVERSITY GOALS OF THE STATE. (C) THE COMMISSION SHALL ENSURE THAT AN INDEPENDENT SYSTEM OPERATOR OPERATE IN A MANNER TO PREVENT MARKET MANIPULATION AND OPPORTUNITIES FOR COLLUSION BY REQUIRING AN INDEPENDENT SYSTEM OPERATOR TO DISCLOSE PRICE DATA RELATED TO ITS WHOLESALE MARKET OPERATIONS INCLUDING, BUT NOT LIMITED TO, INFORMATION ON REAL-TIME, DAY-AHEAD AND SPOT MARKET BIDS AND BIDDERS IN AN INDEPENDENT SYSTEM OPERATOR'S WHOLESALE ELECTRICITY MARKET
AUCTIONS, TRANSMISSION CONGESTION CONTRACT AUCTIONS AND INSTALLED CAPAC- ITY MARKET AUCTIONS TO BE MADE PUBLIC WITH NO MORE THAN A THREE MONTH DELAY. SUCH INFORMATION SHALL BE MADE IN A FORMAT READILY AVAILABLE AND ACCESSIBLE TO THE PUBLIC INCLUDING, BUT NOT LIMITED TO PROVIDING SUCH DATA IN AGGREGATE HOURLY, DAILY, MONTHLY, ANNUAL AND HISTORICAL DATA SETS FOR COMPARISON PURPOSES AS WELL AS DATA RELATED TO SEASONAL AND PEAK LOAD VARIATIONS AND AVERAGES. (D) THE COMMISSION SHALL ENSURE ACCOUNTABILITY BY REQUIRING THAT AN INDEPENDENT SYSTEM OPERATOR'S BOARD OF DIRECTORS INCLUDES AT LEAST THREE NON-GOVERNMENTAL APPOINTMENTS THAT DIRECTLY REPRESENT THE INTERESTS OF RESIDENTIAL SMALL BUSINESS AND FARM ELECTRICITY USERS. THE GOVERNOR, THE SPEAKER OF THE ASSEMBLY AND THE TEMPORARY PRESIDENT OF THE SENATE SHALL EACH APPOINT ONE REPRESENTATIVE TO THE BOARD. (E) THE COMMISSION SHALL REQUIRE AN INDEPENDENT SYSTEM OPERATOR TO CREATE THE POSITION OF CONSUMER LIAISON WHOSE PRIMARY ROLE SHALL BE TO INTERACT WITH MEMBERS OF THE END-USE SECTOR FOR THE PURPOSES OF: (I) KEEPING END-USE SECTOR MEMBERS INFORMED ABOUT DEVELOPMENTS IN WORKING GROUPS/SUB-COMMITTEES THAT MAY AFFECT THEIR INTERESTS; (II) EXPLAINING THE ISSUES AND PROPOSALS UNDER DISCUSSION AT THE WORK- ING GROUP/SUB-COMMITTEE MEETINGS AND PROPOSED FOR CONSIDERATION AT THE OPERATING COMMITTEE, BUSINESS ISSUES COMMITTEE AND MANAGEMENT COMMITTEE AS WELL AS THE RAMIFICATIONS OF THOSE PROPOSALS ON CONSUMERS; (III) LISTENING AND RESPONDING TO THE QUESTIONS AND CONCERNS OF MEMBERS OF THE END-USE SECTOR; AND (IV) SERVING AS THE LIAISON BETWEEN THE END-USE SECTOR AND THE DIREC- TORS DESIGNATED OR ASSIGNED TO PAY PARTICULAR ATTENTION TO THE INTERESTS OF THE RESIDENTIAL, SMALL BUSINESS AND FARM ELECTRICITY USERS. (F) THE COMMISSIONER SHALL ANNUALLY ISSUE A REPORT RELATING THE MARKET OPERATION OF AN INDEPENDENT SYSTEM OPERATOR. SUCH REPORTS SHALL INCLUDE, BUT NOT BE LIMITED TO: (I) ANALYSES BY AN INDEPENDENT SYSTEM OPERATOR AND OTHER SUCH DATA COLLECTED AND ANALYZED BY THE COMMISSION INFORMATION ON REAL-TIME, HOUR-AHEAD AND DAY-AHEAD MARKET BIDS AND BIDDERS IN AN INDEPENDENT SYSTEM OPERATOR'S WHOLESALE ELECTRICITY MARKET AUCTIONS, TRANSMISSION CONGESTION CONTRACT AUCTIONS AND INSTALLED MARKET AUCTIONS; (II) A DETERMINATION OF THE EXTENT TO WHICH THE ENERGY MARKETS ARE MAINTAINING NECESSARY LEVELS OF RELIABILITY; (III) A DETERMINATION OF WHETHER OR NOT ALL CUSTOMER CLASSES ARE BEING ADEQUATELY SERVED BY COMPETITIVE ENERGY MARKETS; (IV) A DETERMINATION OF THE COMPETITIVENESS OF ENERGY MARKETS; INCLUD- ING A DETERMINATION WHETHER OR NOT THE ELECTRIC INDUSTRY IS PROVIDING CONSUMERS WITH THE LOWEST PRICES POSSIBLE WITHIN A RESTRUCTURED, COMPET- ITIVE RETAIL MARKETPLACE; (V) A DETERMINATION OF THE EXTENT TO WHICH THE ENERGY MARKETS ARE ACHIEVING THE ENERGY EFFICIENCY AND FUEL DIVERSITY GOALS OF THE STATE; (VI) THE NAME AND TERMS OF THE BOARDS OF DIRECTORS AND AN INDEPENDENT SYSTEM OPERATOR MANAGEMENT, OPERATING AND BUSINESS COMMITTEE MEMBERS; (VII) AN INDEPENDENT SYSTEM OPERATOR'S FINANCIAL INFORMATION; AND (VIII) RECOMMENDATIONS FOR IMPROVING ANY DEFICIENCIES SO IDENTIFIED IN ELECTRICITY ENERGY MARKETS, INCLUDING NON-COMPETITIVE PRICING SITU- ATIONS. THE COMMISSION SHALL SUBMIT SUCH REPORT TO THE GOVERNOR, THE PRESIDENT PRO TEM OF THE SENATE, THE SPEAKER OF THE ASSEMBLY, THE MINOR- ITY LEADERS OF THE SENATE AND THE ASSEMBLY, THE CHAIRS OF THE ENERGY COMMITTEES OF THE SENATE AND THE ASSEMBLY, NO LATER THAN APRIL FIRST, TWO THOUSAND FOURTEEN AND ANNUALLY THEREAFTER. S 2. This act shall take effect immediately.

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