Residential Customers Need a Place at the Regional ISO Board Table
Posted on July 8, 2016 by Bob Jenks
Tags, Energy
The California Independent System Operator (CAISO) manages California’s electric grid, whereas in the rest of the West, utilities and the Bonneville Power Administration manage their own transmission grids and resources. PacifiCorp, the parent company of Pacific Power, and CAISO recently announced a proposal to merge the California transmission grid with PacifiCorp’s grid to form a Regional Independent System Operator. Under their proposal, a new Board would manage the expanded ISO and would dispatch various generating units to meet loads throughout the West. The assumption is that this will more efficiently operate the transmission grid and lead to lower costs.
On July 7, CUB submitted comments criticizing the proposed Board or governance structure of this new regional organization:
“CUB is generally disappointed that the proposal seems to ignore the interest of customers themselves, particularly small usage customers such as residential and small commercial customers. Just as most of us would not want to go into a legal proceeding without an attorney to advocate on behalf of our interests –even if we feel the judge is fair-minded—it is not reasonable to ask customers to join a multi-state, regional stakeholder process without an advocate. The process should envision and provide for meaningful and professional customer representation. CUB finds the current Proposed Principles document to be lacking in this respect, and does not support a set of principles with this void.”
The ISO governance proposal envisions a stakeholder process to inform the ISO Board. CUB pointed out that a stakeholder process is extremely time consuming, and resource intensive. Because of this, large entities with a significant financial stake in the decision will dominate.
“Residential customers, on the other hand, will be heavily affected, but the impact, will be diffuse. They will have little ability to participate individually, and in the current proposal will have very limited means to participate effectively as a group. While residential customers are expected to be the financial base of Regional ISO, there is little in the straw proposal to suggest that they will be able to participate, or that their participation will have an impact. In PacifiCorp’s Oregon territory, 86% of all customers are residential customers and those customers are approximately ½ of the utility’s load.”
Oregon has laws and regulations, as do most other states, to ensure that residential customer’s interests are represented and considered. In Oregon, voters created CUB to represent customers and the PUC to manage an intervenor-funding program that helps ensure professional representation for consumers. Other states do it differently but whatever the model, most states have programs to ensure consumer representation.
From the beginning, CUB urged the folks working on the Regional ISO Governance structure to include customer interests. The Regional ISO in the Eastern part of the country provides funding to a nonprofit organization created by the consumer advocate offices in that ISO territory. CUB proposed a similar model for the western U.S. In addition, CUB recommends that states enjoy the flexibility to ensure adequate availability of resources for consumer protections.
Over the next few months, there will be a great deal of discussion and analysis concerning the costs and benefits of a Regional ISO. But even with benefits, there is no guarantee that they will be fairly allocated without strong representation for residential customers. The Governance structure must recognize this point and provide an option for adequate consumer representation.
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12/27/16 | 0 Comments | Residential Customers Need a Place at the Regional ISO Board Table