Legislature(2019 - 2020)BUTROVICH 205

02/17/2020 09:00 AM RAILBELT ELECTRIC SYSTEM

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Audio Topic
09:02:40 AM Start
09:03:18 AM SB123
09:52:10 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Location Change --
+= SB 123 ELECTRIC RELIABILITY ORGANIZATIONS TELECONFERENCED
Heard & Held
-- Public Testimony --
           SB 123-ELECTRIC RELIABILITY ORGANIZATIONS                                                                        
                                                                                                                                
9:03:18 AM                                                                                                                    
CHAIR  COGHILL announced  the consideration  of  SENATE BILL  NO.                                                               
123, "An  Act relating  to the  regulation of  electric utilities                                                               
and  electric reliability  organizations;  and  providing for  an                                                               
effective date."                                                                                                                
                                                                                                                                
He noted the new committee substitute (CS), Version E.                                                                          
                                                                                                                                
He recounted  that AS 42.05 currently  has 8 Articles and  the CS                                                               
creates   a   new   Article  9   called   "Electric   Reliability                                                               
Organizations,  Plans,  and  Standards."  He  read  the  existing                                                               
Articles 1-8 to show  how Article 9 fits in. He  said the RCA has                                                               
a clear  duty. The discussion  today will  be about how  the ERO,                                                               
the  integrated   resource  plans,   and  preapproval   all  fall                                                               
together.  He  said  a  difference   today  is  that  preapproval                                                               
planning must be through an ERO under its resource planning.                                                                    
                                                                                                                                
9:05:29 AM                                                                                                                    
SENATOR SHOWER joined the committee.                                                                                            
                                                                                                                                
CHAIR COGHILL solicited a motion to adopt Version E.                                                                            
                                                                                                                                
9:05:54 AM                                                                                                                    
SENATOR  MICCICHE  moved  to  adopt   the  work  draft  committee                                                               
substitute  (CS)  for SB  123,  work  order 31-LS0959\E,  as  the                                                               
working document.                                                                                                               
                                                                                                                                
9:06:05 AM                                                                                                                    
CHAIR COGHILL objected for purposes of an explanation.                                                                          
                                                                                                                                
9:06:28 AM                                                                                                                    
RENA MILLER,  Staff to Senator Giessel  Alaska State Legislature,                                                               
Juneau, Alaska,  advised that  she is on  loan to  this committee                                                               
for the purposes of SB 123.  She agreed that the CS significantly                                                               
restructures the bill.                                                                                                          
                                                                                                                                
CHAIR COGHILL advised  that the drafter was online  if there were                                                               
questions.                                                                                                                      
                                                                                                                                
MS.  MILLER  reviewed  the  following  summary  of  changes  from                                                               
version K to version E for SB 123:                                                                                              
                                                                                                                                
      Page 1, line 8: Creates new Article 9A in AS 42.05,                                                                       
       Alaska Public Utilities Regulatory Act. Version E                                                                        
     combines subsections into new sections for clarity.                                                                        
                                                                                                                                
         Page 1, line 9: Creates new section 42.05.760,                                                                         
    Electric   reliability   organizations;   from   former                                                                     
     subsections (a), (b), (d), (e), and (f).                                                                                   
                                                                                                                                
     Page 1, line 12 to page 2, line 2:                                                                                         
                                                                                                                                
     Revises provision  to clarify  if all the  utilities in                                                                    
     an  interconnected  system  are exempt  from  RCA  rate                                                                    
     regulation  as municipal  entities/instrumentalities of                                                                    
     the state, the RCA may not require they form an ERO.                                                                       
                                                                                                                                
MS. MILLER  said the  drafter was available  to explain  why "may                                                               
not" accomplishes the intent and  that "shall not" is contrary to                                                               
legislative drafting standards.                                                                                                 
                                                                                                                                
CHAIR  COGHILL  asked Mr.  Klein  to  explain  why "may  not"  is                                                               
equivalent to "shall not."                                                                                                      
                                                                                                                                
9:08:49 AM                                                                                                                    
NOAH  KLEIN,  Legislative  Counsel, Legal  Services,  Legislative                                                               
Affairs  Agency, Juneau,  Alaska,  explained that  the term  "may                                                               
not" is a clear directive  in Alaska statutes that the commission                                                               
cannot do something.  The drafting manual explicitly  says do not                                                               
use  the term  "shall not"  and  Legal Services  drafters try  to                                                               
avoid it.                                                                                                                       
                                                                                                                                
CHAIR COGHILL  said SEAPA  should understand  that the  term "may                                                               
not" is directive.                                                                                                              
                                                                                                                                
9:09:37 AM                                                                                                                    
SENATOR SHOWER  asked if the  inverse is  true if one  says "may"                                                               
versus "shall" as opposed to "may not" versus "shall."                                                                          
                                                                                                                                
MR. KLEIN said  he wasn't sure he understood the  question but he                                                               
didn't  think   so.  May  is   a  permissive  term   that  grants                                                               
permission. For example, a regulatory  body may adopt regulations                                                               
as  opposed to  shall adopt  regulations. The  former grants  the                                                               
authority  but  it   isn't  a  requirement  and   the  latter  is                                                               
directive.                                                                                                                      
                                                                                                                                
SENATOR SHOWER  said he wanted  it on  the record because  it's a                                                               
little tricky.                                                                                                                  
                                                                                                                                
CHAIR COGHILL offered that it was  very easy when his mother said                                                               
he may have  a cookie and it  was very clear when he  said he may                                                               
not have a cookie.                                                                                                              
                                                                                                                                
9:10:49 AM                                                                                                                    
MS.  MILLER  continued to  review  the  summary of  changes  from                                                               
Version K to Version E:                                                                                                         
                                                                                                                                
     Page  2,   line  8:  Conforming  change   to  new  bill                                                                    
     structure.                                                                                                                 
                                                                                                                                
     Page 2,  lines 15,  18: Conforming  change to  new bill                                                                    
     structure.                                                                                                                 
                                                                                                                                
     Page 2, line 25 to page 3, line 1:                                                                                         
                                                                                                                                
     Adds new provision  to allow the RCA to  certify an ERO                                                                    
     for a network that doesn't qualify as a system                                                                             
                                                                                                                                
MS. MILLER explained  that the RCA suggested this  change to plan                                                               
for future eventualities.                                                                                                       
                                                                                                                                
     Page  3,  line  [2]: Creates  new  section,  42.05.762,                                                                    
     Duties  of an  electric reliability  organization; from                                                                    
     former subsection (c).                                                                                                     
                                                                                                                                
     Page 3, line 5, lines 10-11 and lines 13-14:                                                                               
                                                                                                                                
     Changes   'interconnected   bulk-electric  system'   to                                                                    
     'interconnected electric energy transmission network'.                                                                     
                                                                                                                                
9:12:11 AM                                                                                                                    
CHAIR COGHILL  offered his understanding  that the  RCA requested                                                               
this change.                                                                                                                    
                                                                                                                                
MS. MILLER  responded that  the RCA reviewed  the CS  on multiple                                                               
levels. There  have been  some adjustment  to the  definitions of                                                               
those  two terms  near the  end of  the bill  to add  clarity and                                                               
avoid ambiguity.  This resulted  in some term  changes throughout                                                               
the bill. She continued to review the summary of changes:                                                                       
                                                                                                                                
     Page  3,   line  6:  Conforming  change   to  new  bill                                                                    
     structure. [AS 42.05.780(a) is cited.]                                                                                     
                                                                                                                                
     Page  3,  line  14:   Conforming  change  to  new  bill                                                                    
     structure.  [Specific  sections  of statute  are  again                                                                    
     cited.]                                                                                                                    
                                                                                                                                
     Page  3,  line  29:   Creates  new  section  42.05.765,                                                                    
     Reliability  standards,  from former  subsections  (g),                                                                    
     (h), (i), (o) and (n).                                                                                                     
                                                                                                                                
     Page 4, line 1, twice on lines 7-8, and line 14:                                                                           
                                                                                                                                
     Changes   'interconnected   bulk-electric  system'   to                                                                    
     'interconnected electric energy transmission network'.                                                                     
                                                                                                                                
     Page 4, line 10:  Changes 'cybersecurity protection' to                                                                    
     'protection from  a cybersecurity incident'  to conform                                                                    
     with the terms in the definitions section.                                                                                 
                                                                                                                                
     Page  4, line  15: Allows  standards to  result in,  as                                                                    
     long  as they  are not  designed for  the purposes  of,                                                                    
     requiring additions to facilities or new projects.                                                                         
                                                                                                                                
MS.  MILLER  noted that  the  utilities  brought this  suggestion                                                               
forward.                                                                                                                        
                                                                                                                                
     Page 4,  line 18:  Removes requirement  for the  RCA to                                                                    
     hold a hearing before  accepting a standard and removes                                                                    
     references to RCA's ability to  reject a plan. This has                                                                    
     the effect of applying  existing statute on rejecting a                                                                    
     tariff provision.                                                                                                          
                                                                                                                                
MS. MILLER  explained that  this ties  to existing  statute where                                                               
the RCA  is able to reject  a tariff provision only  for form and                                                               
filing.  SB 123  does not  give the  commission a  new method  of                                                               
rejecting a standard.                                                                                                           
                                                                                                                                
CHAIR COGHILL asked why the public hearing was removed.                                                                         
                                                                                                                                
9:14:54 AM                                                                                                                    
MS. MILLER  explained that if  an ERO  files a standard,  the RCA                                                               
has to  publicly notice the  filing but  if there is  no protest,                                                               
the RCA feels  that under their current tariff  provisions, it is                                                               
appropriate to approve the standard without a hearing.                                                                          
                                                                                                                                
CHAIR  COGHILL  added  that  if   there  is  a  protest  from  an                                                               
interested party, public comment goes forward.                                                                                  
                                                                                                                                
MS. MILLER  said yes  and noted that  further down  in subsection                                                               
(b)  there are  more  backstops  if the  RCA  wants  to modify  a                                                               
standard. She continued:                                                                                                        
                                                                                                                                
     Page  4,  line 22:  Removes  reference  to rejecting  a                                                                    
     standard.                                                                                                                  
                                                                                                                                
     Page 5, lines 8-14:  New provision to address potential                                                                    
     conflicts  between  a  Department of  Defense  standard                                                                    
     required  for a  utility serving  military bases  and a                                                                    
     standard adopted by the ERO.                                                                                               
                                                                                                                                
MS.  MILLER  referenced Doyon  Utilities'  concern  that the  ERO                                                               
might  enact   standards  that  potentially  conflict   with  the                                                               
standards  and rules  in their  contract with  the Department  of                                                               
Defense (DoD).  This provision clarifies  that a  utility serving                                                               
military  bases  follows the  federal  standards  if there  is  a                                                               
conflict  while   the  commission  resolves  the   conflict.  The                                                               
language on lines 12-13 also clearly  states that the RCA may not                                                               
resolve the  conflict such  that it  prevents fulfilling  the DoD                                                               
contract.                                                                                                                       
                                                                                                                                
9:16:51 AM                                                                                                                    
SENATOR SHOWER asked  if she was saying that nothing  in the bill                                                               
would prevent the  RCA from flexing to  accommodate the utilities                                                               
in meeting their contract with DoD.                                                                                             
                                                                                                                                
MS. MILLER said  yes; the utility will need to  notify the RCA if                                                               
there is  a conflict  and thus  is exempt  from having  to comply                                                               
with the  ERO standard, but it  is clear that the  commission may                                                               
not resolve a conflict in  a manner that prevents compliance with                                                               
DoD.                                                                                                                            
                                                                                                                                
SENATOR SHOWER expressed satisfaction.                                                                                          
                                                                                                                                
CHAIR  COGHILL  added that  this  ensures  that DoD  requirements                                                               
cannot be changed.                                                                                                              
                                                                                                                                
9:18:35 AM                                                                                                                    
MS. MILLER continued.                                                                                                           
                                                                                                                                
     Page 5, line 18:  Creates new section 42.05.767, Rules,                                                                    
     from former subsection (p).                                                                                                
                                                                                                                                
     Page  5,  line  26:   Creates  new  section  42.05.770,                                                                    
     Regulations, from former subsection (q).                                                                                   
                                                                                                                                
     Page  5, lines  28-29:  Conforming change  to new  bill                                                                    
     structure.                                                                                                                 
                                                                                                                                
     Page 5, line 30 to page 6, line 2:                                                                                         
                                                                                                                                
     Amends   provisions   related   to   an   open   access                                                                    
     transmission   tariff.   Requires    that   the   RCA's                                                                    
     regulations require an ERO  tariff to include standards                                                                    
     for  nondiscriminatory  open  access  transmission  and                                                                    
     interconnection,   and   provisions  for   transmission                                                                    
     system cost recovery.                                                                                                      
                                                                                                                                
MS. MILLER  noted that  the utilities  requested this  change and                                                               
the RCA endorsed it.                                                                                                            
                                                                                                                                
     Page  6, lines  8-11:  Creates  new section  42.05.772,                                                                    
     Duties of  load-serving entities, with a  new provision                                                                    
     clarifying that  all load-serving entities,  even those                                                                    
     otherwise exempt  from RCA  regulation, are  subject to                                                                    
     the ERO's tariff.                                                                                                          
                                                                                                                                
9:20:15 AM                                                                                                                    
SENATOR SHOWER asked  if the last change on page  5 was a redline                                                               
issue.                                                                                                                          
                                                                                                                                
MS. MILLER  replied the utilities  support this language  and the                                                               
concept of enabling transmission  and interconnection options for                                                               
the future.                                                                                                                     
                                                                                                                                
CHAIR COGHILL  added that if  somebody is going to  supply power,                                                               
they need to be part of the tariff structure.                                                                                   
                                                                                                                                
MS.  MILLER  said   the  provisions  direct  the   RCA  to  write                                                               
regulations requiring  that the  ERO's tariff  include provisions                                                               
for   standards   that    are   nondiscriminatory   open   access                                                               
transmission,   which   will   enable  more   economic   dispatch                                                               
throughout the grid.  The ERO wouldn't manage  the provisions for                                                               
transmission system  cost recovery  but would have  standards for                                                               
how  the cost  recovery that's  done  by others  would work.  Ms.                                                               
Miller continued.                                                                                                               
                                                                                                                                
     Page  6,  line  12:   Creates  new  section  42.05.775,                                                                    
     Penalties; from  former subsections  (j), (k),  (l) and                                                                    
     (m).                                                                                                                       
                                                                                                                                
     Page 6, line 13-14, line 21 and lines 24-25:                                                                               
                                                                                                                                
     Changes   'interconnected   bulk-electric  system'   to                                                                    
     'interconnected electric energy transmission network'.                                                                     
                                                                                                                                
       Page 6, lines 28-29: Conforming change related to                                                                        
     restructuring.                                                                                                             
                                                                                                                                
          Page 7, line 4: Conforming change related to                                                                          
     restructuring.                                                                                                             
                                                                                                                                
9:22:59 AM                                                                                                                    
SENATOR MICCICHE  questioned the  use of  the term  "violated" on                                                               
page 6,  line 16 when the  sentence is talking about  someone who                                                               
failed to  comply to a standard.  He asked if there  was a reason                                                               
the drafter chose that approach.                                                                                                
                                                                                                                                
CHAIR  COGHILL said  he believes  it's appropriate.  The ERO  may                                                               
impose a  penalty if, after  notice and  a hearing, it  finds the                                                               
person has violated a standard.                                                                                                 
                                                                                                                                
SENATOR MICCICHE said  it seems like strong language  to call out                                                               
a  violation  for  someone  who hasn't  had  the  opportunity  to                                                               
comply, particularly someone who may  not be one of the utilities                                                               
but is providing capacity on the line.                                                                                          
                                                                                                                                
CHAIR COGHILL  responded that everybody  has a seat at  the table                                                               
when the ERO is developing standards.                                                                                           
                                                                                                                                
9:25:14 AM                                                                                                                    
MS. MILLER said  there is a comfort valve on  [page 7] lines 4-6,                                                               
subsection  (d). She  explained that  the standards  are reviewed                                                               
and noticed  by the RCA and  there would be a  publication to the                                                               
users, owners, and operators that  the standard is taking effect.                                                               
But if  there is a  violation, any penalty imposed  must consider                                                               
the effort that was expended to  remedy the violation in a timely                                                               
manner.  Also, there  is  process involved  before  a penalty  is                                                               
imposed.                                                                                                                        
                                                                                                                                
9:27:05 AM                                                                                                                    
CHAIR COGHILL read paragraph (d) on page 7, lines 4-6.                                                                          
                                                                                                                                
     (d) A  penalty imposed under  this section must  bear a                                                                    
     reasonable   relation  to   the   seriousness  of   the                                                                    
     violation and  take into consideration the  effort of a                                                                    
     user, owner, or  operator to remedy the  violation in a                                                                    
     timely manner.                                                                                                             
                                                                                                                                
SENATOR MICCICHE expressed hope that  the commission would find a                                                               
way to  remedy the  situation before  it gets to  the point  of a                                                               
violation.                                                                                                                      
                                                                                                                                
CHAIR COGHILL  responded that a  penalty can happen in  two ways.                                                               
One is through the ERO and the other through the RCA process.                                                                   
                                                                                                                                
9:28:30 AM                                                                                                                    
SENATOR SHOWER  asked if the  RCA would  be the final  arbiter in                                                               
the appeal process unless the matter is appealed in court.                                                                      
                                                                                                                                
MS. MILLER  answered yes;  a penalty  imposed by  the ERO  can be                                                               
appealed  to the  RCA and  a penalty  imposed by  the RCA  can be                                                               
reconsidered under the  current RCA process and then  it would go                                                               
to the courts.                                                                                                                  
                                                                                                                                
MS.  MILLER  continued to  review  the  summary of  changes  from                                                               
Version K to Version E.                                                                                                         
                                                                                                                                
     Page 7, line  10: Changes 'interconnected bulk-electric                                                                    
     system'    to     'interconnected    electric    energy                                                                    
     transmission network.                                                                                                      
                                                                                                                                
     Page 7,  lines 19-20:  Repositions the  requirement for                                                                    
     the  RCA  to review  the  process  used to  develop  an                                                                    
     integrated  resource  plan  so that  the  consideration                                                                    
     must  be  made  before   the  RCA  decides  whether  to                                                                    
     approve,  reject  or  modify a  plan.  Previously,  the                                                                    
     consideration  was related  to  the  modification of  a                                                                    
     plan (page 6, line 27).                                                                                                    
                                                                                                                                
     Page  8, line  8: Changes  'submission' to  'filing' to                                                                    
     conform.                                                                                                                   
                                                                                                                                
     Page 8, line  17: Added 'for large  energy projects' to                                                                    
     the section heading for project pre-approval.                                                                              
                                                                                                                                
     Page 8, lines 18-19 and lines 22-23:                                                                                       
                                                                                                                                
     Changes   'interconnected   bulk-electric  system'   to                                                                    
     'interconnected electric energy transmission network'.                                                                     
                                                                                                                                
     Page 8,  line 19:  Clarifies that  project pre-approval                                                                    
     is required  only for projects  in a network  served by                                                                    
     an ERO.                                                                                                                    
                                                                                                                                
CHAIR COGHILL said  he thought this concept was in  bill but this                                                               
makes it very clear.                                                                                                            
                                                                                                                                
9:31:26 AM                                                                                                                    
MS. MILLER continued.                                                                                                           
                                                                                                                                
     Page 8,  line 29:  Conforming to reference  new section                                                                    
     numbers.                                                                                                                   
                                                                                                                                
     Page  9,  lines  2-3:  Exempts from  the  project  pre-                                                                    
     approval requirement  hydro power projects  licensed by                                                                    
     FERC after Sept. 1, 2016, and before July 1, 2021.                                                                         
                                                                                                                                
     *Drafting  error:   Intent  was  to   capture  projects                                                                    
     licensed before Sept. 30, 2016. Amendment pending.                                                                         
                                                                                                                                
CHAIR COGHILL commented that there will be several cleanups like                                                                
this.                                                                                                                           
                                                                                                                                
MS. MILLER continued.                                                                                                           
                                                                                                                                
     Page 9,  line 10 and page  9, line 31 to  page 10, line                                                                    
     1:                                                                                                                         
                                                                                                                                
     Changes   'interconnected   bulk-electric  system'   to                                                                    
     'interconnected electric energy transmission network'.                                                                     
                                                                                                                                
     Page  9,  line  27:   Creates  new  section  42.05.790,                                                                    
     Definitions,  from former  bill  section  2. With  this                                                                    
     change, terms are  defined for the purposes  of the new                                                                    
     article related to EROs, and not throughout AS 42.05.                                                                      
                                                                                                                                
     Page 10, line 3: Conforming to reference new sections.                                                                     
                                                                                                                                
     Page  10,  lines  6-7:  Definition  for  interconnected                                                                    
     bulk-electric  system is  modified to  not include  the                                                                    
     'plant' and to reference network definition.                                                                               
                                                                                                                                
     Page  10,  lines  10-12: Definition  of  interconnected                                                                    
     electric  energy transmission  network  is modified  to                                                                    
     include  the 'plant'  originally  in the  bulk-electric                                                                    
     system definition.                                                                                                         
                                                                                                                                
     Page  10,  lines   17-18:  Definition  of  load-serving                                                                    
     entity is  refined to require  at least  10 bill-paying                                                                    
     customers.                                                                                                                 
                                                                                                                                
     Page  10,   line  20:  Changes   'interconnected  bulk-                                                                    
     electric  system'  to 'interconnected  electric  energy                                                                    
     transmission network'.                                                                                                     
                                                                                                                                
MS. MILLER  said that  concludes the changes  that appear  in the                                                               
work draft for SB 123, Version E.                                                                                               
                                                                                                                                
CHAIR  COGHILL   listed  the  individuals  available   to  answer                                                               
questions.                                                                                                                      
                                                                                                                                
MS.  MILLER asked  the Chair  if  he wanted  to go  over the  two                                                               
proposed substantive amendments.                                                                                                
                                                                                                                                
9:35:06 AM                                                                                                                    
SENATOR  SHOWER directed  attention to  the definition  of "load-                                                               
serving  entity" in  paragraph (6)  on page  10, lines  16-18. He                                                               
asked  if  an  area  with   more  than  10  properties  that  has                                                               
generation and is growing would be forced to be part of the ERO.                                                                
                                                                                                                                
MS. MILLER  responded that the  load-serving entity has to  be an                                                               
electric  utility,  which is  a  high  bar  for somebody  who  is                                                               
serving 10 customers.                                                                                                           
                                                                                                                                
SENATOR SHOWER expressed satisfaction with the answer.                                                                          
                                                                                                                                
CHAIR  COGHILL asked  if this  isn't  similar to  the DoD  matter                                                               
where a utility may serve a military base as a single customer.                                                                 
                                                                                                                                
MS.  MILLER responded  that  load-serving  entities have  certain                                                               
obligations  relative  to the  ERO,  one  of  which is  that  the                                                               
operational  costs of  the ERO  must  be spread  among the  load-                                                               
serving entities.  Those costs  can then be  passed along  to the                                                               
ratepayers through  a surcharge. In exchange,  the ratepayers get                                                               
such things as reliability and cybersecurity protection.                                                                        
                                                                                                                                
She  continued  to explain  that  an  independent power  producer                                                               
(IPP) is  an electric utility  that is a load-serving  entity but                                                               
it doesn't  have customers that  pay direct invoices so  the bill                                                               
has tried to  restrict that by requiring more  than 10 customers.                                                               
Receiving  invoices directly  from  the entity  goes directly  to                                                               
Doyon Utilities  that is  paid via one  invoice from  the federal                                                               
government. The idea is to not pass along those costs.                                                                          
                                                                                                                                
9:38:56 AM                                                                                                                    
CHAIR  COGHILL  asked  Ms.  Miller to  go  through  the  proposed                                                               
changes  to Version  E. He  noted that  it is  identified as  the                                                               
mark-up that will go to Legislative Legal.                                                                                      
                                                                                                                                
He advised that  the proposed changes will be drafted  into a new                                                               
CS for the committee's consideration on 2/19/20.                                                                                
                                                                                                                                
MS. MILLER described the following changes:                                                                                     
                                                                                                                                
     Page 1, lines 4-5 of the title.                                                                                            
     Delete:    "public   utilities    interconnected   with                                                                    
     interconnected bulk-electric systems"                                                                                      
     Insert:  "certain large  energy  facilities" to  better                                                                    
     align with the section heading.                                                                                            
                                                                                                                                
SENATOR MICCICHE pointed out the importance of the word                                                                         
"interconnected" and suggested the insertion should be "certain                                                                 
large interconnected energy facilities."                                                                                        
                                                                                                                                
MS. MILLER replied she would flag that for the drafter.                                                                         
                                                                                                                                
     Page 2, line 1.                                                                                                            
     Delete: "electric utilities"                                                                                               
     Insert: "load-serving entities"                                                                                            
                                                                                                                                
     Page 2, line 8.                                                                                                            
     Delete: "(d) of this section"                                                                                              
     Insert:  "Section 42.05.762"  because  the  ERO has  to                                                                    
     comply with this section.                                                                                                  
                                                                                                                                
     Page 2, line 20.                                                                                                           
     Insert:  "Notwithstanding the  requirements  of (d)  of                                                                    
     this  section,"   before  "If"  and  move   the  entire                                                                    
     subsection  to  above  subsection (d).  This  clarifies                                                                    
     that the  RCA does not need  to create an ERO  if these                                                                    
     utilities  can  ask  for and  receive  a  waiver.  [The                                                                    
     subsections   would  be   renumbered   if  the   entire                                                                    
     subsection is moved.]                                                                                                      
                                                                                                                                
9:42:47 AM                                                                                                                    
     Page 3, line 6.                                                                                                            
     Delete: "an"                                                                                                               
     Delete: "plan"                                                                                                             
     Insert: "plans" This  contemplates multiple versions of                                                                    
     the  initial integrated  resource plan  for the  ERO as                                                                    
     the years go by.                                                                                                           
                                                                                                                                
     Page 3, lines 18-19.                                                                                                       
     Delete:  "developing reliability  standards and".  This                                                                    
     is  where  the ERO  must  show  that  it has  rules  to                                                                    
     provide  reasonable notice,  public process,  openness,                                                                    
     and   balancing   interests.   Developing   reliability                                                                    
     standards is just one of multiple duties of the ERO.                                                                       
                                                                                                                                
     Page 6, line 2.                                                                                                            
     Delete: "provisions"                                                                                                       
     Insert: "standards"                                                                                                        
                                                                                                                                
     Page 6, line 23.                                                                                                           
     Delete: "bulk-electric system"                                                                                             
     Insert: "electric energy transmission network"                                                                             
                                                                                                                                
     Page 7, lines 9 and 13.                                                                                                    
     Insert:  "all" before  "customers".  The  intent is  to                                                                    
     ensure that  integrated resource planning  accounts for                                                                    
     every  customer,  whether they  are  served  by a  load                                                                    
     serving entity or not.                                                                                                     
                                                                                                                                
     Page 7, line 19.                                                                                                           
     Delete:  "a hearing".  Standards are  considered tariff                                                                    
     provisions and the RCA has  existing statute for acting                                                                    
     to  these. The  IRP will  be  filed as  a petition  and                                                                    
     there isn't  existing language in  the RCA  statutes to                                                                    
     rely on.                                                                                                                   
                                                                                                                                
     Page 7, line 20.                                                                                                           
     Delete: "reject"                                                                                                           
                                                                                                                                
     Page 7, line 23.                                                                                                           
     Following "orders." insert:  "The commission may reject                                                                    
     all or  part of  a petition that  does not  comply with                                                                    
     form  or filing  regulations by  the commission."  This                                                                    
     language comes from  the RCA statutes on  how to reject                                                                    
     a  tariff  filing.  The only  way  the  commission  can                                                                    
     reject an  IRP filed is  if it doesn't meet  the filing                                                                    
     specifications, not  because the  RCA doesn't  like the                                                                    
     IRP.                                                                                                                       
                                                                                                                                
     Page 8, line 5.                                                                                                            
     Delete: "the"                                                                                                              
     Insert: "a"                                                                                                                
                                                                                                                                
     Page 8, lines 25-26.                                                                                                       
     Insert:  "in  a  cost-effective manner"  from  line  26                                                                    
     after "would" on line 25.                                                                                                  
                                                                                                                                
     Page 9, lines 2-3.                                                                                                         
     Rewrite  paragraph  (2),  as previously  discussed,  to                                                                    
     say:                                                                                                                       
             (2) hydropower project licensed by the                                                                             
          Federal Energy Regulatory Commission before                                                                           
          September 30, 2016.                                                                                                   
                                                                                                                                
MS. MILLER  said that concludes  the proposed changes  to Version                                                               
E.                                                                                                                              
                                                                                                                                
9:47:29 AM                                                                                                                    
SENATOR MICCICHE commented  that there is a lot  of redundancy in                                                               
subsections (b) and (c) on page 6.                                                                                              
                                                                                                                                
MS. MILLER  agreed and said  she would  note that to  the drafter                                                               
with the Chair's approval.                                                                                                      
                                                                                                                                
CHAIR COGHILL gave his approval. He  added that he would have the                                                               
proposed  changes drafted  into a  new  CS for  the committee  to                                                               
consider as well as any amendments the members may bring.                                                                       
                                                                                                                                
SENATOR  MICCICHE  said he  assumes  that  public testimony  will                                                               
remain open.                                                                                                                    
                                                                                                                                
9:49:23 AM                                                                                                                    
CHAIR COGHILL removed his objection  to adopting Version E as the                                                               
working  document. Responding  to  the question,  he stated  that                                                               
public  testimony would  remain open  while the  bill is  in this                                                               
committee.                                                                                                                      
                                                                                                                                
He asked Mr. Rose to offer his testimony.                                                                                       
                                                                                                                                
9:50:43 AM                                                                                                                    
CHRIS ROSE,  Executive Director Renewable Energy  Project Alaska,                                                               
Anchorage, Alaska, said  he was pleased with  the improvements to                                                               
SB 123.                                                                                                                         
                                                                                                                                
CHAIR COGHILL noted  that John Burns with  Golden Valley Electric                                                               
was also listening online.                                                                                                      
                                                                                                                                
9:51:19 AM                                                                                                                    
CHAIR  COGHILL  found no  further  objection  and Version  E  was                                                               
adopted.                                                                                                                        
                                                                                                                                
[SB 123 was held in committee.]                                                                                                 
                                                                                                                                

Document Name Date/Time Subjects
SB 123 - Version E Work Draft.pdf SRBE 2/17/2020 9:00:00 AM
SB 123
SB 123 - Version E Summary of Changes K to E.pdf SRBE 2/17/2020 9:00:00 AM
SB 123
SB 123 - Version E Sectional.pdf SRBE 2/17/2020 9:00:00 AM
SB 123