H.B. 238 Utah Energy Generation and Transmission Planning: transcript

Yes. Thank you. Uh, appreciate that. If I could ask the chairman of the public Service commission to come up and join me. Okay. Um, This is about energy generation and transmission planning organizations. Uh, some of you may have heard of RTOs or ISOs, uh, RTO as a regional transmission organization, and ISO as an independent system operator in California, they have the Kai O, which is California iso. And, uh, Rocky Mountain Power participates in an EDM, an energy Daily market. And, uh, as we discussed this, uh, possibility during our summer, summer interims, and, uh, we had a working group between the House and the Senate, uh, on this subject. And, uh, we invited some folks in to talk to us. And, and we thought that the, uh, you know, the Public Service Commission ought to be involved in, uh, possible approval of these regional transmission organizations and independent system operators that maybe our large utilities get involved with here in the west. Uh, there is a fiscal note, but, uh, that fiscal note is for commission staff. Let's, do you Remember For a minute What, I think that was Senator Stevenson. Funny, unmuted. Oh, Anyway, I'll, I'll just briefly review the fiscal note that could be paid out of the public utility, uh, restricted account called the PERF account, uh, which charges public utility, a fee of 0.3%, and the cooperatives that operate in the state one point a half percent. So there would be no general fund, uh, expense on this. Uh, it basically just asks that the commission get involved rather than maybe some of our utilities jumping off the cliff and joining some organization that we really, uh, wouldn't want them to do that there'd be some type of oversight and regulation. And, and that's why I've asked the commissioner to come, uh, the chair of the commission to come and explain briefly what, what, what he, how he sees it, and what the bill, how the bill would help him. Mr. Chair, Uh, just so you, just for your information, we have, you have a, a third sub. Yeah, there is a third sub. Would you like to just came online this afternoon. It'll address, do you wanna do the other part of the bill? But I'd like to have him address the R-T-O-I-S over

Thank you, Senator Hinkins. Appreciate the opportunity to be here with Representative Albrecht and speak as to the, um, original, uh, draft of the bill, um, that, uh, enacts, uh, sections, uh, 54 dash 27 1 0 1 to 1 0 5. Um, that's the, uh, the provisions dealing with RTOs and ISOs. Okay. Uh, you can really think of a regional transmission operator like an air traffic controller. Uh, and really what this bill does is gives us, uh, a seat in the tower, so to speak. Um, RTOs don't, um, own the, uh, power plants or the power lines, but, um, they, uh, they have, um, the responsibility to, to coordinate, uh, to make sure electricity gets where it's, uh, it needs to be. Um, so the, the key provision of this bill is it requires the commission to participate in any RTO or ISO that, uh, an electrical corporation in the state joins. And, um, uh, as, as, uh, as mentioned, um, there are really a couple of different organizations out there, um, that, uh, in the northwest there, there has not yet been a regional transmission organization formed that I'm aware that Rocky Mountain Power Pacific Corp has, uh, indicated that they're going to, uh, try to join. There is the California Independent System Operator, which is, um, controlled by California, um, state government. Uh, there's been what's called a Pathways program to try to stand up an independent, uh, RTO that's not governed by, by Kaiso, but that remains to be seen where that, uh, that goes. But, um, in this state already, Deseret, uh, power is, uh, uh, is very interested in, in planning to participate in the Southwest Power Pool, SPP. And, um, and what this bill would do is if Desiree is a member of SPP, uh, it gives, or if down the road, uh, Pacific Corps, um, uh, uh, wants to be part of an RTO, uh, this really gives the commission, uh, a mandate from the legislature to participate in the planning and cost allocation processes of the, um, of the RTO. And, um, and so really what, um, the commission would be doing, I'm, I'm gonna take, uh, SPP as an example because that's, uh, farther along in the, in the process here. And we have a, an entity in the state that has already indicated an intention to be part of that. Um, this would allow the commission to be involved in the organization of the RTO. And, um, and in SPP, there's what's called the Regional State Committee. And every state that's a participant in the Southwest Power Pool has a commissioner, uh, on this, this regional state committee. And so, Utah would have an, an opportunity, uh, if this, when this bill passes, it's, it would be mandated to be involved in the governance processes of the RTO. And, um, and so we would be a member, uh, Utah Commissioner would be a member, uh, of the, um, regional state committee. And, and the primary responsibility is it really does have a significant role in overseeing the work of the, the RTO. It, it's responsible for co cost allocation for transmission upgrades. It's responsible for, um, resource adequacy issues and allocation of transmission rights, uh, in the markets, uh, in which SPP operates. And so, um, it also, I think, would give the state, um, through its regulatory body a an opportunity to participate in the plan planning for the future. And, um, the key is, uh, the way that, um, representative Alrich has drafted this bill is it, uh, makes sure that Utah is not, uh, unfairly treated. And, um, so I think, uh, we support, uh, uh, the bill, um, as to the issues involving the, um, uh, RTOs and ISOs, we think we should have a seat at the table. And, um, we think it'll protect Utah customers and Utah companies and, um, and make sure that the decisions that are made are equitable and not do not disproportionately impact in a negative way Utah, uh, customers and Utah companies. Now, I, I ought say, with respect to, um, um, the third substitute, um, uh, I think this will be important for people that are here. As to the third substitute, uh, we are, we currently have under consideration a community clean energy program. And, um, we're not, we don't take any position on, uh, the issues in the third substitute. Uh, and I, and I, I'll let Representative Valberg talk as to what those issues are, but 'cause I just want to be clear that our position is we apply the law that the legislature gives us. And as it is currently drafted, that's, um, how we're, uh, approaching this, uh, community clean energy program. We had hearings on this, uh, while back and we're in the process of, of drafting an order. But, uh, I just think I, I needed to make sure that people understood we're not taking a position on the, on the issues that are in the third substitute, but just as to the original bill. Okay. And, uh, I know that this is to, for electrical transmission, but when they start talking clean energy, now all of a sudden are talking hydrogen. Will that include that into hydrogen pipelines? Will it be under that jurisdiction? 'cause it's these considered a clean energy and natural gas. There's claimant's a clean energy or a cleaner energy, or whatever they may be. But hydrogen's definitely being classified as blue energy. I think it's a good question. So, uh, it, it, it, it depends if you're talking about natural gas pipelines, that's not subject to this, uh, legislation. I'm talking about if you use natural gas to generate electricity and that those electrons are on the transmission lines. Um, yeah. I mean, one of the real issues, uh, with respect to this, uh, regional transmission, um, um, organizations is, um, with respect to some states have clean energy policies and greenhouse gas policies. And so at least with respect to the organization that would be stood up in the northwest, there is gonna, I think there's gonna be an attempt to, um, make sure that states that don't have greenhouse gas emission, uh, requirements that they're not paying for the cost of, say, Oregon and Washington's policies. So, not that Sure, that totally answers your question, but, well, The reason I ask is because the new, uh, IPP project is being touted as being hydrogen powered, uh, power plant, natural gas and hydrogen power. And I'm just curious if that would fall under our jurisdiction of the Public Service Commission to do hydrogen pipelines. Well, uh, I think anything that's evolving a monopoly utility Okay. Would fall under the jurisdiction is we're not so much concerned as a method to delivery of, of, uh, of electricity, or we're concerned about whether it's an, an entity that, uh, doesn't have competition in the marketplace. That's, that's the entity we regulate. But to the extent that the IPP, uh, project to using a different source of fuel is, um, uh, is going to be putting their electricity generated on transmission lines, then I think that with respect to this bill, there is a role for the, the commission to play.

It's Jerry Finn and I'm the chairman of the Utah Public Service Commission.

Chair, would you like me to discuss the third sub before you adopt it? Uh,

Okay. I have a handout I'd like to give you. Okay. Uh, is that okay? Yes, Sir.

I, I want the, uh, the committee to know that Representative Alrich listens to constituents before I discuss this, um, come out with this. Uh, back in, uh, 20 19, 7 years ago, house Bill four 11 was passed, which allowed communities that so desired to, to, uh, go to a hundred percent renewable energy. Rocky Mountain Power's been working with them, as has the Public Service Commission, which has just been stated, uh, to establish a renewable portfolio for those cities who desired to do that. Uh, sub two said that they should be able to opt in. Uh, after listening to a lot of, uh, interested parties this morning and, and afternoon, I, I come up with sub three, which, uh, gives them an opportunity to opt out. And some of these cities are, Are now getting to the point, and the Public Service Commission is about to rule, uh, on what, what, what exactly it's gonna cost these communities customers to, to be part of this clean energy program. And, uh, it, it will increase their rates. But the form I handed you would be a form that goes out with the community's letters to every customer, giving them the right to opt out, as you can see there in the middle of the page, uh, rather than to opt in because under the legislation they're already in and would have to opt out. Um, I, I just wanna say that, uh, you know, a lot of, a lot of these communities, Salt Lake, Park City, and others, were concerned about the image that might be created with the 2034 Olympics, uh, whether we're serving black electrons or green electrons. And, and, uh, so I, I, I made the, the substitution in sub three. Okay. And, uh, I would hope that would address the concerns for a lot of, a lot of these cities. Uh, maybe if I could, uh, have John Cox come up for a minute. Okay. He could give a little more flavor on the history. Okay. John was involved in this back in 2019. Go ahead.

Yeah. Thank you, Mr. Chair. And thank you, representative Ulbrich. Um, you, you presented it well. Uh, this has been going on for quite some time, time. Introduce Yourself so we can make sure we get you in the, Of course. Uh, John, John Cox. Uh, and, and in this moment, I'm not representing Rocky Mountain Power. I think they're actually gonna testify later about the underlying piece of the bill as well. But, uh, just to give that background, uh, the, the bill was passed seven years ago. Uh, during that time or since that time, uh, the different communities have, uh, engaged at different levels. Some were in, and then some, uh, came out. Uh, but today you've got 19 communities that are looking to proceed with this program. Uh, they've almost completed that commission process. They're just waiting for a ruling from them. Uh, but once that occurs, every resident within those communities, uh, is going to get, uh, two different notices or, or the law calls for at least two different notices. And what Representative Albrecht is calling for is within that notice, it has to be separate from their monthly bill. So it has to be something that catches your attention differently. And, uh, as part of that, he indicates it has to have, uh, sort of a check the box that says I choose to opt out. Um, with that notice, it will show what your current rate is and what your new rate would be under this program so that you could see, hey, there's a cost increase. I don't want that. It's clearly listed here in bold letters. Here is what I check to opt out. Okay. Uh, so that is what the third substitute, uh, does and hopefully alleviate some of the concerns that were raised previously.

Move to adopt the third sub, Third substitute. So the motion is before us to adopt the house Bill, 2 38 third substitute. Are you okay with, you've explained it. So that's pretty much, I pretty much described it. Thank you. Okay.

Whatever. Aye. I would move to adopt or help to adopt a third sub. Okay. So, thank you.

Yeah, I, I could just verify, you know, in what Clean energy resource means in the bill. It's is wind, solar, uh, photo VoLTE and thermal solar technology, geothermal, hydroelectric, and anything that uses carbon capture utilization and sequestration and nuclear fuel.

I'd like to think Senator Blouin as well for Playing Along, even though you probably know, probably not the, the one you would wanted has the most. Thank you, Senator. Thank you for having me. My name is, uh, Dan Dugan. I'm the chair of the Utah Renewable Communities Board. And, uh, just adjusting sub through. And I really wanna appreciate representative Re's comment there where he listens. And, uh, I appreciate the work that he has done with our program on Substitute three. Uh, the renewable community program consists of the 19 communities from across the state representing 25 of the Rocky Mountain Power customer Base. And we appreciate the work that, uh, we're doing here today, and we appreciate the work that, what's been going on here. And since in action, the legislation in 2019, the program cities have been working in earnest to enact the statutory requirements of the, of the legislation, including each city adopting a resolution supported by the residents of the 19th City. I won't go on any further than that because we are supportive of, of, uh, the sub sub three at this time, and appreciate the work that we've, uh, accomplished so far. So thank you very

welcome Mr. Chairman, members of the committee, Tom Carter, Rocky Mountain Power. Uh, someone, someone much wiser than me once said, uh, investor-owned utilities do not run their businesses. We provide information to the people that do, and that is public service commissions. So on the underlying legislation, we are very grateful that the sponsors brought forth this, uh, this bill because while Rocky Mountain Power and Pacific Corp are not currently, nor do we have plans to engage in a regional transmission organization, if we were, the Public Service Commission should absolutely have a seat at the table. And Utah's Public Service Commission should have a very strong voice there to represent the needs and the wills and the desires of our customers. And so this, uh, legislation is needed and wanted. And so we appreciate, uh, the sponsor of this bill, having that forethought and foresight, and we look forward to continuing to work with our regulators and this legislature on these types of ideas. Thank you.

Uh, thank, thank you Mr. Chair, members of the committee. Uh, I'm Nathaniel Johnson. I'm the Executive Director of the Utah Rural Electric Cooperative Association. And, uh, I'd like to speak in support of, uh, the R-T-O-I-S-O portion of, of the bill. Uh, I think Chairman Finn did a, a fantastic job of, of representing, uh, what that, uh, portion of the bill is encompasses. And as, as he mentioned, Deseret Power, uh, does have five co-op members, uh, within their organization. And a, uh, one of the co-op members, a portion of their service territory will be participating in, uh, the SPP, uh, the S-P-P-R-T-O. And so I, I think, uh, really what this bill, uh, includes is that there be adequate data transparency. And I think that, uh, from a state regulatory perspective, that, uh, it, it is best when, when they have all the information that other state regulators have. And so, uh, we're appreciative to, to represent Holberg for his work on, on this bill, Thank you for testimony.

Yeah, I've stayed away for a few weeks. Yeah. Yeah. I also, uh, I am Gaylin Benyan and I'm currently mayor of Cottonwood Heights, although I'm testifying, um, not for the whole city, but as mayor personally, um, I just want to thank the sponsor. Also, late last night, I was sending texts and receiving responses from the chair of this committee as well as the sponsor of this bill. So they do listen, and I want our citizens to know that we also as local leaders, listen. Um, we had a hearing on a committee discussion of, on a council discussion on this bill in January, and had strong response from our community that we still want to stay engaged in this opportunity. And it really is a way to add more energy to our grid that was not in the, in the work. So overall, it's a great benefit for our state. And again, I just wanna thank the sponsor and all involved. Thank You. Thank you. Thanks.

Good afternoon commission. Um, I'm here in support of the bill. Thank you, representative Ulbrich for, uh, the late change in substitute three. Uh, the one part of the bill that I do want to call attention to, um, is around termination fees. Um, I come to you as a citizen, um, with eight years of rate making experience, um, particularly around these tariffs and riders. Um, that includes solar, um, offerings from the utility, the termination fee aspect, particularly after the opt-in, um, period has ended. It sounds like in the bill, um, it may be more of a requirement, maybe it's not. That could be a misunderstanding on my part, but termination fees are not typically how these programs run. Typically, it is after a 12 month period, uh, when a customer is signed up on the rate or tariff, uh, they have the option. What that does is overall, um, allows for more stability in the rate, there's not the potential for a mass exodus. Um, so that's just one small piece that, um, maybe I'd just love to hear some clarification on. Um, just in terms of a great implementation from the participating communities and the Public Service Commission,

Yes. Dylan Munn Slow down when you say this stuff. Dylan Munn. Okay. With who? Um, I'm a resident. Okay. Just your personal. Yes, yes. Okay.

Thank you Chair and members of the committee. Um, I would also like to thank sponsor Albrecht for, um, that change to substitute three of the bill. My name is Nathan Hole. Um, I'm representing myself as a constituent. Um, I am a resident of Sunset City in Davis County and graduated from Weber State University as a student there. In 2019, I worked directly with the university and communities to join the renewable communities program, including my second home of Ogden and our support of increasing clean energy across the state. I came here ready to testify against the second substitute, um, that was introduced than 24 hours ago. Um, but was very surprised that, um, not an hour before the committee meeting, a third substitute was posted. Um, that took into account some of those concerns. Um, and I'm, I'm grateful to see that that was listened to that, um, those voices were heard. This program has been lauded as a model for municipal collaboration with a major utility, um, on creating energy choice for customers. When it was passed in 2019, it was celebrated as the Utah Way and just received Weber state's prestigious 2025 sustainability collaboration award. The opt-out provision was deeply debated. And after months of negotiation with dozens of stakeholders, the law was written to include ample opt-out safeguards, notes, requirements, and low income bill payment program options. These existing provisions ensure two things that there is enough market certainty to pursue clean energy contracts while also ensuring customers have the choice to participate. Without the program certainty, there can be no program and there can be no choice. I'm gratified to see that now in the third substitute language that the program retains its integrity and the ability of the program to pursue clean energy contracts that are currently underway. It has the potential to bring hundreds of megawatts of clean energy built here, right here in Utah, providing local jobs and tax base to rural communities. That helps us bring on new sources of solar wind storage and geothermal energy just as energy demand surges nationwide. And the governor has declared our pursuit of Operation Gigawatt, please continue to uphold the integrity of the Utah Renewable Communities program. And importantly, please continue to engage the broad set of community stakeholders when addressing this program, and respect the thousands of hours and millions of dollars that have been invested to make this program a success. Thank you. Thank

Can I speak to it for just a moment? Yeah, I think we skipped, of course. That's what fine. Okay. Uh, yeah. I'm excited to see we are enabling our public service commission to, to work towards, uh, participating in an RTO. Obviously this doesn't direct us or anything. I just want to call out when we're talking about the pro uh, program, when we're talking about the, the, the substitute version here that, uh, includes new language, I think it, it's important to clarify that, uh, this is on there and, and you know, it's being explained as if this is going to make certain customers who, who choose not to opt out, uh, that, that this is gonna be more expensive. And, and the only reason is because, because we have segregated these costs off. If we, I think just looked at this as a system and, and we're bringing in new clean energy like we see other states doing, uh, we'd see our costs come down. Pacific Corp, of course, has acknowledged that, uh, wind and solar reduced their fuel costs over the years. And, uh, and this would allow us to get more of that clean and cheap energy, uh, on the grid as we move towards an RTO. So, uh, this is a little bit of a, a, you know, problem of our own making. I'm super supportive of the program. I'm glad we have this, but, uh, I think it's important to note that more clean energy will make, uh, our bills more affordable over the, over the years as we start to move in this direction. So important to remember that.

Sure. I'll move the, uh, what do we got? H HB HB 2 38 sub three. Uh, be recommended for the full Senate. Okay.

I could say a lot of things, but I think there's been enough said. Thank you. Okay.

Thank you, Mr. Chair. I'm sorry about that. Uh, getting Into it. I'm sorry. And I appreciate you, uh, moving me to last because I was called to the principal's office, but, um, We won't ask about the spanking. Thank you. HB 2 38, Utah Energy Generation and Transmission Planning was a bill that was, um, discussed in our energy working group this summer between the Senate and the House, uh, working group. By the way, I do have, uh, the chair of the Public Service Commission with me here, Jerry Finn, who will comment in a minute. Um, maybe for a little bit of education, I could tell the committee that, um, RTOs Regional Transmission Organizations and ISOs independent system operators are organizations that are made up of a group of, uh, folks who have transmission lines on the grid. And they may purchase power market power, uh, from an RTO or an independent system operator. To give you an example, in, uh, right now, California has what they call an iso, California ISO Independent System Operator. Uh, this bill would apply to, uh, large utilities in the state that have transmission lines, uh, by a lot of power on the market. And, um, it would require the Public Service Commission to participate in these regional transmission organizations and independent system operators. Where Utah has utilities that are members in those, uh, it authorizes the commission to contract for an independent analysis of any market data, uh, requires annual reporting to the legislature, to this committee, uh, on the impacts to Utah customers from, uh, power purchases or transmission line contracts to, to, to carry that power. And it requires notification to the legislature if the commission is denied access to participation. Um, there, I'll just give you one example. I was reading the Manti Messenger on printed Thursday, January 8th, and they had the, uh, power manager, Ophir View City, which is a UAMS member reporting to their city council. And he said the city is entering a critical transition period in terms of power. In May, 2026, Pacific Corp will integrate with the California independent system operating system, potentially revolutionizing re regional power trading. Uh, he indicated that, uh, Fairview's involvement through ums, uh, will be crucial in, in navigating these changes. So in Utah, you have the co-ops, uh, and you have the municipalities, and then you have Rocky Mountain Power. Um, because transmission lines are involved and market power purchases are involved, then, um, this becomes a, a critical, uh, bill because of, uh, purchases or transmission agreements that a Utah utility large utility may enter into, uh, that could affect rates, probably would affect rates one way or the other. So that's basically what the bill does. Um, and this working group that met this summer said, Hey, they had some experts come and, and testify, uh, before our working group. And, and the committee or the working group said, you know, maybe, maybe we need to, to formulate a bill on this to protect our Utah electric rate customers. And so I was assigned to, to work through this bill and, and come up, uh, and, and, uh, be, um, be the sponsor of the bill. Now, in, in transparency, uh, full transparency, I wanna say that it does have a fiscal note, uh, starting fiscal year 27 and 28. It's about $250,000 a year. But, and, and that's to help the Public Service Commission, uh, with their costs in, in working with, um, contractors to help them gather information so that they can make wise decisions concerning rates. Uh, but that, that money would come from the public utility, uh, restricted account, uh, which, uh, that restricted account is funded, uh, with a 0.3% of gross operating ru uh, revenues for, uh, uh, public utilities other than co-ops. And co-ops are charged a 0.15% of gross operating revenue. So that's how this, uh, perf, if you will, public utility regulatory fee, uh, is funded. So it would not come from general funds. Uh, so with that, Mr. Chair, I, I would like to turn some time over, uh, to Mr. Fan, uh, public Service Commission chair to add his comments to my testimony. Okay, Mr. Chair, please proceed.

Thank you. Uh, chairman Jack and, uh, Representative Albrecht, uh, Jerry Finn, uh, chairman of the Public Service Commission here to speak in favor of, uh, Representative Brooks, uh, HB 2 38. One of the, uh, public Service Commission's primary responsibilities, um, is to ensure that Utah customers receive safe, reliable, and affordable services. This bill addresses what role the commission should play in the event Rocky Mountain Power or an electrical cooperative become a member of a regional transmission operator. I'll refer to it as an RTL hereafter, or an independent system operator, an ISO. First of all, we think that the actions that are contemplated by this bill, or what we should do, or what a utility we think would likely expect us to do, even in the absence of a statute, our job is to make sure that Utah rate payers are not disadvantaged. And in the case of an RTO or an ISO, that they actually receive benefits. So for the commission to meet the directive of customers receiving safe, reliable, and affordable services, we believe the commission's participation in an RTO or an ISO would be sound public policy. The PSE believes that the bill provides significant and appropriate guidance to the commission in the event that utilities in the state becomes become members of an RTO or an is o. So first, the bill provides clear direction in 54 27 dash 1 0 2 of how the commission shall participate, uh, actively in the RTO or ISO includes involvement in stakeholder processes, governance committees, technical forums, and market related proceedings. Second, the bill also provides direction about obtaining operational market and reliability data from the RTO or I saw, and it describes the type of data that the commission should obtain in section 27 dash 1 0 3. Third, the bill also provides for, uh, the services of an independent consultant with respect to the complexities in this arena. And fourth, the spec specified subject matter of the annual report to the legislature, I think is really right on point. It focuses on key drivers of potential cost burdens that can be imposed unfairly or disproportionately on Utah customers. The legislative reporting and oversight, uh, provided by this bill are in the public interest. Uh, as, uh, Representative Albrecht indicated this is not funded out of the general fund. The commission staff is a pretty lean operation. It would, uh, it would, this would contemplate hiring of potentially another staff person or the hiring of a consultants to, uh, provide the data. This is a fairly complex area of the law or of, of regulatory law, and I think it's, uh, it's justified. Um, and there is some headroom under the public utility regulatory fee right now. The, the perf, uh, it's, um, is not at the maximum allowed by statute. So if there were additional funds necessary, it would be able to be covered, I think, under the existing statutory provisions. So, in summary, the commission supports this bill, and it seemed to us that the foundational principles of this bill, uh, shouldn't really be controversial. It provides a solid foundation, uh, for the PSCs actions with respect to markets and RTO and ISOs in the Western region. It settles the question of how involved we should be. The answer is very much involved and provides the goal of that involvement, which is to determine whether the hope for benefits are actually realized by Utah rate payers and to minimize the inequitable or disproportionate impacts on Utah rate payers. Appreciate very much the opportunity to present before the committee today. We're open for questions, Mr. Chair.

Thank you, Mr. Chair, and thank you for this presentation. You answered quite a few of my questions actually already in your presentation, which is good. Uh, but I have a few others. Uh, so while I'm not a big fan of commissions in general, no offense, um, None taken Just because I think they can protect, but I also think they can control. And so I think we have to, you know, like always have a balance there. Um, and, you know, I'm, I'm wondering in, in this particular role that the commission would take on, um, what that would kind of look like with, as that role goes into action, what do we see that looking like? Um, what data are we actually collecting? I know we mentioned the necess the necessity for data, and I suppose I could see why in order to do your role, you might have to have data right? To be able to do that. But I'm just wondering what data exactly we'd be collecting and, um, yeah, I mean, I guess how, how do we can, is this something that could be taken care of without a commission or is it absolutely vital that we have a commission? And if so, educate me on that because, um, I, I don't love attaching everything to a commission, just in general.

Okay. Well, the Utah Public Service Commission's set up by statutes, been in operation a lot ears, and it's there to protect the utility repairs and make sure that rate adjustments that are filed are fair and, and equitable for each rate class. The data that I would say that they would gather from a consultant or an employee would be What are other states doing in this area? What, what are other rates provided by an RTO or an ISO in other states? Are they comparable to what's being proposed? If one of our major utilities joined one of these RTOs or ISOs? Um, and that is very technical, uh, as your chair could tell you. Um, so those are the kinds of data points that they would be looking for, either through a consultant or an employee. Is it a fair and equitable transmission contract? Is it, is it, as compared to other states, is it a, uh, fair and equitable wholesale price that they're getting on their power purchases? Does that help

A lot? Yeah, you're, you're putting it in my language now, so thank you for that. I appreciate that. Um, I think that's good.

Can I make a motion? Are we ready for that? Sorry.

All right. I wanted to, I wanted to move it favorably.

Thank you, Mr. Chair. Um, um, good representative Alrich and, uh, Mr. Finn. Uh, I attended a number of conferences this summer on, uh, on a lot of things that you're talking about, and I know enough to be dangerous now. So, but, and I learned how much we should appreciate our commission. Yes. Because you, you are not elected and, uh, heard the horror stories from some other states. You know, you, you just appreciate and go along with what we have. And that's what we've, we've done. And I really thank you for doing the good work that you do and to Utah for doing what we did. But I have, I have, I have a concern, and I just want to ask this, and I don't, I don't know which one of you will answer it, but I think it'll be Mr. Finn. Um, I learned about these, um, um, our ISO and RTO regional, um, didn't know about them. My, my big concern is as we were in these meetings, um, we have a big, I'm gonna say it's an outlier, but they're a dominator, and that's California. And so right now my understanding is because we don't belong to any of these, we are not, um, um, involved with California that much, and I have a real concern that, that we would maybe be with them in one of these. Would that happen? Could that happen?

Well, let me, let me a answer the question this way. So, um, so Rocky Mountain Power is already going to be a participant in what is called the Energy Day Ahead Market or EDAM. Okay? They have been, for a number of years, a participant in the Western energy and balance market, which makes real time, uh, purchases and transactions with respect to electricity to make sure that there's adequate resources on the grid, the, uh, the EDAM market that will go out, go live in May. Uh, an entity does not have to be a, a member of an RTO to participate in that. The idea there is hopefully to, uh, reduce the cost of electricity through purchases, uh, a day ahead of when they're actually gonna be needed. Now, with respect to, um, the, the discussion with respect to RTOs and ISOs, generally, this has been discussed for over a decade here in the west. Uh, the west, uh, California in a very small part of Nevada is part of, uh, sel, the California Independent System operator, uh, the other states, um, Idaho, Wyoming, Utah, uh, other states in the mountain west are not part of that. One of the principle concerns has been, uh, when a, um, uh, an RTO that's affiliated with EDAM is created, will it be under the control of the state of California? And I think that's what, where you're going with Representative Watkins. Yes. And my understanding is, is that that one of the hesitations of the other states has been whether that's, uh, RTO would be independently operated from Kais o and that is the intention, and that's where it is headed, is to have an independent board of governors. So it won't be under the control of the California legislature, under the control of, of kaiso. So this is all a work in progress. It's still, uh, it's still being developed, but that, um, is something you, you notice I said in the event that a utility becomes a member of an RTO, that's one of the things that you want to look at when you're considering whether they become a member of an RRTO, is what's the operational and governance structure of that. And so I think I, I've tried to answer that, that it should be independent of the government of the state of California, which a point appoints the boards of directors to kaiso.

Thank you. That's exactly what I needed to hear. So thank you, Mr. Chair.

Mr. Chairman, members of the committee. My name is Tom Carter. I'm with Rocky Mountain Power. Um, I might just, uh, it might be easy for me to say, uh, I agree with everything that the sponsor has said and everything that Chairman Fen has said, and, uh, leave it at that. I think basically, um, we want the Public Service Commission to be part of this process. We need the Public Service Commission to be a part of the process. We're not in the process currently of looking at joining an, uh, independent system operator or, uh, an RTO. While it has been mentioned that we are currently participating or plan on joining the Energy Day Ahead market as a voluntary market, there are concerns as it relates to what an RTO could mean for our generation facilities, our transmission facilities, and most importantly our customers. And so, having the, this legislation, which codifies what we would hope the commission would be a part of is important to us. And we like to joke, it's not my saying it's someone much wiser than me once said, we don't run our business. We provide information to the people that do, and that's the commission. And we want to ensure they have the, all the information they could have and need to have to ensure that these types of decisions are made prudently and appropriately for the customers of this state. And, um, that, uh, that's, those are my remarks. I'm happy to answer any questions.

Mr. Chairman, my name is Jeff Hartley. Um, I'm here speaking on behalf of myself and my brother Greg. He doesn't let me speak for him much, but we represented a, an organization that was studying and, um, observing and monitoring and, uh, lobbying for RTOs, um, for about five years, um, including during the time when the current California led, um, RTO was being established. And I think this is a great piece of legislation because you all, and we as rate payers all want our public Service commission watching the hen house. We want them to monitor what contracts and negotiations are made, um, within an RTO if, if our public utilities join them. And we also want them watching, uh, the integrity of the grid and the reliability of the grid, what, what our utilities might get stuck with in terms of transmission congestion and other things. It's, I think it's a very good use of the Public Service Commission to have them watching, uh, what happens as this, as this RTO as as RTOs get set up if assuming the Rocky Mount Power joins this one, um, and have them watching that. So I appreciate the bill. It's, it's actually needed and helpful, and thank you.

We're looking for an action. Hello. Okay, my mic's on. I would like to move this favorably. Um, sorry. HCR? No, hb Hb, sorry, We're back up at number one. We're back to number one, not the last one. HB 2 38. I would like to recommend it favorably out of this committee and, um, I would like to speak to that.

for power generation and not only for Utah, but for the rest of the West. I think this is a great opportunity for repairs on, um, current repairs, even with Rocky Mountain Power to have an opportunity and the say and we as a state to have a say as well. So I think I, I, I love this legislation. I think it's something we've, we've needed for a very, very long time. So thank you.

Thank you, Mr. Chair and committee members. Um, I think enough's been said, but I will say here in Utah, um, Rocky Mountain Power has, um, the Hunter Plant and the Huntington plant. And Desiree has, has the Bonanza plant, and, uh, UAMS has some gas plants and Rocky Mountain has some gas plants and we're very fortunate in that regard. And I think this bill just protects our assets that those those companies hold and, uh, would, would strengthen our relationship should one of them ever get involved in an RTO or an ISO that would protect Utah assets and, and benefit our customers. Thank you.

No, I, um, I agree with represented Al Al brick and, and, um, and I hope you'll support me in getting this out. Thank you.

Thank you, Mr. Speaker. Uh, colleagues. This is a bill that we discussed during our summer interims, uh, with the energy working group between the Senate and the House. Uh, as the utility industry changes there, I'll give you some background and try to be helpful. There. There has evolved what they call RTOs, regional Transmission Organizations and ISOs, which are independent system operators. And maybe you've read something about California's iso, it's called C-A-I-S-O, cao, so they have their own. But this bill, after we'd talked about it and received presentations, uh, during our summer, we, we just felt like there ought to be a bill that the Public Service Commission should be involved in these regional transmission organizations and independent system operators. And, and so I was designated to run this bill. Basically what it does, Mr. Speaker, is it requires the Public Service Commission to participate in these organizations, uh, where Utah Utilities or members such as Rocky Mountain Power and others, and it authorizes the commission to contract for an independent analysis of, uh, market data so that we know what we're doing as far as protecting our rate payers. And then of course, it requires, uh, the annual reporting to the various legislative committees, uh, on the impacts to Utah customers. Uh, and, and it does, uh, have a fiscal note in the spirit of full Delo disclosure. But that money will come from the, uh, public utility restricted account. Uh, that fund is generated by a fee that, uh, the utilities pay 0.3% of their revenue. Uh, and the co-ops in the state pay 1.5% of their revenue. And so there's ample money in that fund to cover the fiscal note. If the Public Service Commission goes out and hires a contractor or an independent, uh, person to, to study the impacts of an ISO or an RTO, uh, on utilities and how it could affect their rates. I realize it's a complicated bill, but it's, it's a very important bill for utilities, uh, to protect their customers in the state of Utah. We did have the chair of the Public Service Commission who came and testified and, uh, encouraged, uh, encouraged the legislature to get involved in this and, and give them the authority to look at at rates, uh, as they're impacted by RTOs and ISSOs. And we also had our large utility testify. They agreed to be involved. So I think we've, we've tried to protect the customers, uh, of our large utilities, our small utilities, uh, both co-ops and, uh, uh, private investor owned utilities such as Rocky Mountain. So that's basically what the bill does. Uh, Mr. Speaker, uh, it's, it's important that we, we, if, if, uh, one of our large transmission providers in the state or one of our large utilities decides to get involved in one of these organizations, we ought to have some say so. And we ought to have, uh, somebody that's on that board of the RTO or the ISO to look after Utah customers. That's basically the bill. Mr. Speaker,

Thank you, Mr. Speaker. Um, I think that protecting Utah's energy is important. Putting it into the hands of three unelected people is scary to me. Um, lines 45 through 47 and lines 57, 55 through 73 talk about the how the Public Service Commission and will go about doing things on behalf of Utahans. And I, I appreciate the idea on paper. Um, would this truly improve outcomes for Utahans or would it shift power to a commission? I would love to see more oversight, um, more than an annual report by the Public Service Commission to the committees. Thank you

Thank you, Mr. Speaker. I would rise in support of this bill we've seen in other states around the country jumping in to ISO ISOs or RTOs or other organized markets. And they have done so in some cases without regard for the customers and the rates they're paying. And we've even seen some states mandate that their utilities get into this sort of business without taking into account how much that's gonna cost their customers. And you're seeing the effect in the, in the industry of some very high rates that are directly attributable to those, to those markets. And so we worked really hard over the interim to make sure that we've put these guardrails in Utah so that we've put customer protection in place so that if comes the day that there is a worthy market for us to join or it looks like there may be that we'll be able to do the proper analysis and make sure that we've really got what we need before we jump into business with somebody. So with that Mr. Speaker, I would encourage support of this bill.

Thank you, Mr. Speaker. Uh, my good friend from Dixie just summarized the bill very well. Thank you.

acquiring the top public service commission and the PSC to actively participate in a regional transformation mission organization and independent system operator. Whenever Utah Utility are members or market participants, these transmission organizations will transmit electricity throughout the Intermountain West and throughout the west and and across state boundaries. Uh, the bill authorizes the PSC to obtain detailed operation and market data and enter confidentiality agreements and contract with independent experts to verify the modeling and cost allocations. So we want to make sure that, uh, we're ensuring that Utah has a strong regulatory voice in regional transmission and energy market structures. With these increasingly going on in the the demand for energy, we need to make sure that we have, have an influence and reli on the reliability and the customer costs. So the rate payers were Utah rate payers per, are protected by requiring the transparent oversight of con congestion costs, market rules and re regional adequacy requirements. So our PSC basically as the, as we get involved, if we have, if we're part of the market, if we're part of that transmission process, we want the PSC to make sure ensure that the, that our customers are receiving fair treatment and also we're retrieving the receiving the same treatment as the by use of the transmission assets as other states are. There are times when other states give preference preference and we do not want that to happen. We wanna make sure that Utah has the same preference. It also provides lawmakers with annual transparency reporting back to the interim committee, the ET interim committee on the benefits and risks of the regional market participants. And then finally, if the, we find that the PSC has not being able to get that information and they're not receiving the data that's being requested, then they notif they would notify legislative leadership. So further action might be, could be taken.

So Adam open for questions, Discussion to the bill.

Thank you Mr. President pro tem. I would wait further summation and move that third substitute house bill 2 38. Be read a third time. The motion is shall third substitute house bill 2 38. Be read A third time roll call vote.

Senator Vickers Baldry Lein Aye. Brammer bus? Aye. Fillmore Aye. Escamilla Aye. Fillmore. Aye. Grover Harper a. Kinins Aye. Ipson Aye. Johnson. Aye. K. Juab McKay Aye. Mikel Milner Aye. Musselman Owens pitcher Plum Rebe Sandal Stevenson Stratton Strat Bickers Weiler Aye. Wilson Aye. Winterton President Adams

Uh, I I think we already had the announcements earlier and I'm sure everybody with their memories remember exactly what, uh, Senator Comore said earlier. Um, so I would just do a motion that we had adjourn until Thursday, February 19th at 10:00 AM

Uh, the bill authorizes the Public Service Commission to get, uh, detailed operation reports when we're dealing with in these like, uh, regional transmission organizations and independent system operators, where Utah is a participant in that. And a lot of these will cross state lines, state boundaries. Uh, we're authorizing them to gather information and data and make sure that, that our Utah rate payers are being protected and we're getting the best deal. Also, that we're getting the same consideration as other states. Also, if they're having running into any problem getting the data, we're they are directed to contact legislative leadership, uh, immediately so that that can be addressed. I will tell you one thing, you may, some of you may have gotten some emails about a community clean energy program that was started in 2019, a previous version to this, and I think it was the second substitute had that. So it was an opt in instead of an opt out, which would've completely disrupted the program that was started in 2019. This version puts it back to an opt out. So it, it does not do that. So if you have received any of those emails, just know that this sub has taken that portion out and that is no longer a concern in the bill.

I, Senator Blue into the bill. Thank You President. Uh, yeah, I just want to say appreciate the work that was done to preserve the Community Renewable Energy program. That was a, a big concern when this came to committee and, uh, we heard from a lot of folks and it seems like this has resolved the issue. So that will protect the program in, in several cities that I represent. Uh, I think this is a great underlying bill, so I'm happy to see that happen. Uh, I do wanna say, I think, uh, we are going to lose out on some of the benefits that we could get through this bill through the, uh, the decision by Rocky Mountain Power to, uh, sell off assets in the Northwest. Uh, so I, that's something that'll be coming down the pike and as, as we see that, I hope that will, uh, get some legislative consideration. But this is a good bill, uh, and it, it hopefully will bring lower costs to our customers and, uh, and more, more clean energy. Thank you.

Summation and a motion I waste summation and move This third substitute house Bill 2 38 pass.

Senator Brammer, uh, motion to circle. Hold on. Motion. Go ahead. Gimme that motion again. Your mic. Was it on Motion to circle? Motion to circle again if you wanna run it today, we will Motion to circle.

Thank you Mr. Speaker. Motion to concur with the Senate.

Yeah. We went back to, uh, sub two in the Senate committee. Uh, satisfied all the naysayers.