Panel Approves Bills to Change Power Boards

On a day in which California narrowly averted rotating blackouts, a new legislative committee on the energy crisis met for the first time Thursday and approved measures to revamp two controversial power boards and give the state control over sale of some power plants.

“It’s appropriate that we start this meeting on the day of a Stage 3 alert,” said Assemblyman Roderick Wright (D-Los Angeles), chairman of the new Assembly Committee on Energy Costs and Availability.

The first bill, by Assemblyman Fred Keeley (D-Boulder Creek), would replace the industry-dominated boards of the California Independent System Operator and Power Exchange with governor’s appointees.

Gov. Gray Davis has called for such a measure, saying the boards need to be made up of consumer representatives. The bill is opposed by the ISO.

The other, by Assemblymen John Dutra (D-Fremont) and Anthony Pescetti (R-Rancho Cordova), would allow the Public Utilities Commission to regulate the sale of utility-owned power plants. Under the state’s 1996 deregulation of electricity, the commission now can regulate the plants only until their market value is determined.

Both bills, along with more than a dozen others dealing with the energy crisis, are expected to clear the lower house today, lawmakers said.

Reflecting the magnitude of the crisis, the large hearing room was crowded with lobbyists for the utilities, independent power generators, consumer groups, labor unions and government agencies.

The Power Exchange, which is governed by an 30-member board, is a computerized marketplace that purchases much of the state’s electricity for California’s utilities. The ISO, governed by a 26-member board, purchases some power, but its main role is to manage the flow of electricity to the state.

Both are nonprofits created under the deregulation law, which decreed that appointees be “stakeholders” in the energy business. As a result, board members are predominantly power industry executives.

Keeley’s bill seeks to reduce the boards to three members each. Keeley and other critics said the boards are too large and too closely tied to the power companies that stand to profit from their actions.

“There were people who made votes, and they were people who may have been advantaged by those votes,” Wright said.

All the new appointees would be chosen by Davis--a situation that concerned some legislators, who wanted some control over the appointees to provide a check on the governor’s power.

Other members complained that a three-member board is too small to represent rural areas, consumers, farmers and the other interests affected by fluctuations in power prices.

Another bill--yet to be approved--by Sen. Debra Bowen (D-Marina del Rey) would require Senate confirmation of the Davis appointees to the power boards.

The second bill approved Thursday seeks to expand the PUC’s regulatory control over the sale of energy assets by investor-owned utilities--Pacific Gas & Electric Co., Southern California Edison Co. and San Diego Gas & Electric Co. The state’s power crisis has been driven in part by escalating prices charged by companies that purchased power plants from California utilities.

Also Thursday, the Davis administration began devising a plan to cut the state’s energy use, something it hopes will persuade Energy Secretary Bill Richardson to extend a federal emergency order that forces out-of-state power producers to sell to California.

The plan calls for a 5% reduction. Much of the conservation would come from the way California runs the State Water Project, its massive north-south water delivery network.

The state will cut pumping during periods of high electricity demand. Also the state will reduce power use at state colleges and universities.

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Times staff writer Dan Morain contributed to this story.