Senate Standing Committee on Rules

Okay, that was a short 60 seconds. We have a lot going on, as you can imagine, with committees all over the place. Assembly committees, Senate committees. But this is the Senate Committee on Rules and we will come to order. So good afternoon, every one. The Senate continues to welcome the public in person and via the Teleconference service.

We're holding our committee hearing in the O Street Building in room 2200 for individuals wishing to provide public comment via the Teleconference service. The participant toll free number and access code are posted on our committee website and will be and is being displayed right now on the screen here in this room. The participant number is 877-226-8163 and the access code is 1618051.

And also, on behalf of our incredible court reporter, I would ask all speakers and my colleagues and witnesses alike to speak slowly and clearly. Before we begin today's agenda, we need to establish a quorum and a reminder. Colleagues, you'll need to turn on your microphones for the roll call. And every time that we vote, Madam Secretary, will you call the roll?

Laird here. Laird here. Ochoa Bogh, here. Ochoa Bogh, here. Smallwood Cuevas. Grove Atkins here. Atkins here.

Thank you. A quorum is present. And as I said, we have multiple Members that are presenting bills in places that are on other committees. So you will see people coming and going, but I assure you, they have read the materials. They will ask questions if they're here at the time we do that, and we'll just proceed like all other committees and get right down to business with that. Since I have a quorum, I am going to try to dispense with some items that will go on call.

But so that we further the business, I would like to entertain a motion on item two before we take up the conference that are here present today. Item two, which is governor's appointees not required to appear. And I would ask for a motion on item two, C, D and E. Thank you. And these are appointments to the California Water Commission. And two for the Water Commission and one for the Sacramento San Joaquin Delta Conservancy governing board. Madam Secretary, will you please call the role on item two?

Laird aye. Laird Aye. Ochoa Bogh. Ochoa Bogh, aye. Smallwood Cuevas, Smallwood Cuevas, aye. Grove. Atkins aye. Atkins aye.

That will be on call. Item number three, the referral of bills. I would take a motion. Thank you, Senator. Laird, call the roll.

Laird, aye. Laird aye. Ochoa Bogh aye. Ochoa Bogh, aye. Smallwood Cuevas? Smallwood Cuevas, aye. Grove. Atkins aye. Atkins aye. On call.

That will be on call. I'm going to make a separation on floor acknowledgments. I would ask for a motion on item four.

I would move item four.

Thank you, Senator Laird. We call the roll on item four.

Laird, aye. Laird aye. Ochoa Bogh, aye. Ochoa Bogh, aye. Smallwood Cuevas. Smallwood Cuevas. Not voting. Grove. Atkins aye. Atkins aye.

That will be on call. I would ask for a motion on items five, six and seven together for introduction.

So move.

Thank you, Senator. Laird, call the roll.

Laird aye. Laird aye. Ochoa Bogh aye. Ochoa Bogh aye. Smallwood Cuevas. Smallwood Cuevas aye. Grove Atkins aye. Atkins aye.

That will be on call. So now we will return to item number one. Governor's appointees required to appear. Let me invite up Ms.. Karen L. Douglas, Member of the Public Utilities Commission. Let me say welcome back. You have been before us before, although you will notice some returning Members and some new Members I would invite you to acknowledge. Thank anyone you would like that might be with you today or watching and any opening comments. And then we'll go right to Members of the Senate Rules Committee for questions and comments. Welcome.

Thank you so much, Madam Chair and Committee Members. It's a real pleasure to be here today, and it's an honor to receive your consideration for the appointment and confirmation to the California Public Utilities Commission.

I'm tremendously honored to have been appointed to this position by Governor Newsom and to appear before you today. I'd like to start by recognizing and thanking my family for their support. My daughters are here with us, Sarah and Leah Vargas, and they've made it to past confirmations as well, at least most of them.

My husband, Mauricio Vargas, isn't able to be here today, but he'll be watching later. And I think my parents, Bill and Vivian Douglas, are online. And my grandpa, actually, who is in LA and approaching his 101st birthday and still talks to me about my work and asks about it, is hopefully able to watch it right now as well, especially for my immediate family.

The demands of this work and the issues that are before us make real and frequent appearances in their lives. And their support and understanding are so important to me. So thanks for the opportunity to acknowledge them.

I come into this role with a lot of background and experience in California energy, and I have a lot of appreciation for how far we've come in the energy transition. And I also have a lot of very concrete understanding of the challenges before us and the steps that I think we have to take to meet those challenges and to stay on the path that we need to stay on for the benefit of all Californians. It's clear, and some of our conversations have touched on a lot of these points.

There is some stress in the system and we need to recognize it and we need to address it with a sense of urgency. And some of the conversations we've had have covered some of these issues, and there's really a long list of priorities, and these are all things that matter, and they matter now. So meeting the increasing demand for electricity by building the clean energy projects, by making in a sustained way the investments that we need in the transmission and the generation and storage and distribution system.

Timely moving forward in a way that's also equitable and that recognizes that there are disparities in the infrastructure as it is in different communities and therefore the opportunities that people have to take part in the energy transition to electrify their house or to charge their cars. And we need to move forward with urgency in addressing some of those disparities as well. And we need to focus on affordability.

We need to understand, and I do understand that there are so many Californians for whom their utility bill is a regular source of stress. And we have to be very rigorous and creative and determined on finding ways to move forward in ways that protect affordability, even as we do the many things that we absolutely have to do. We have to strengthen reliability now and into the future.

We have to do that in a world where the changing climate is presenting us with new challenges and where the methodologies that we are accustomed to using as an industry standard to say whether we have or have not. Purchased enough or insured enough. Reliability are not reflective of current and future conditions and where we have to just understand that and make decisions in that context.

And we have to recognize that the need to build the clean energy, to build the capacity to support reliability into the future is something we've just got to focus on year after year after year to get this done. The basic customer service side of the industry as well. And we've had some of those discussions timelines on interconnection, timelines on customer energization, communication to people, to customers when things are happening that they really need to know about, like the natural gas price spikes that hit us in the winter.

These are things that we really need to focus on. And the Public Utilities Commission really has a central role in all of this. It's the mission and focus of the Public Utilities Commission to safeguard the provision of critical utility services to customers in a safe and reliable and affordable so, you know, how we solve for these very real issues as we move forward, how we balance these different parts of the mission are going to be really important.

It's going to take attention to detail and it's also going to take an ability, I think, to problem solve and to really look for ways that you solve for multiple objectives creatively while meeting the needs of the system and supporting every effort to meet the needs of people here in California. So I just wanted to say clearly that I recognize those challenges and feel a sense of urgency to work with my colleagues on the CPUC and throughout the state and stakeholders in the process of addressing them. I think it's really important to do that.

And I also have a sense of optimism that we can do that. I've seen California achieve really amazing things in the energy transition. And I've seen people really kind of rise the occasion to get, for example, projects permitted and built and supplying clean energy to the grid at times when we had real opportunity and real need to do that.

And so I think we can do it. I think we do need to bring the leadership and sustained focus to that. And it's a real privilege and honor for me to have the opportunity to play this role at the California Public Utilities Commission. I really welcome your questions and I want to thank you for the dialogues that a number of us have been able to have as well over the last couple of days. Thanks.

Well, thank you very much, Ms.. Douglas. And congratulations you're lucky to have a grandfather that's over 100 years old and that he's listening. So to your family, thank them for the support that they've given you. It's good to have you back here. And what a substantive opening, as always, not unsurprising. I'm going to go first to Senator Laird and to kick us off.

Thank you very much. I apologize because the minute I'm done asking questions, I have to go present two bills. And I really appreciated our long discussion and I have known you for 20 years through many of your different incarnations.

So I have a basic faith that you're going to do a good job and that you have long been grounded in these issues. One you went into in your opening statement, and I wanted to drill down a little more, was on the whole issue of electricity rates because we have loaded a significant amount of our climate program on them and it's my view that's not sustainable over time and yet the climate program has to happen. And so how do you see that balance and how do you see your role in the PUC in addressing that issue?

So there are a number of things that I think we have to do, Senator, and there absolutely are areas where we have, through rates, supported some of our climate programs. One example is that the PUC signed above market contracts to help bring utility scale solar online back during the Recovery Act and the contracts had their desired effect. We got a lot of projects online, there was a lot of federal stimulus money and benefits that came to California.

We had workforce benefits and the overall cost of the projects and the industry ultimately declined and we're seeing the benefit of that now. But that's one example. We have other programs as well that may not have the right level of ratepayer benefits or that may have once had those benefits but may not be paying the same dividends today because of changing conditions.

I do think that's one of the things we have to look at. And the Legislature has provided support to affordability as well, quite a bit of support in the last budget cycle. All of us are going to have to problem solve on how we stay on our path, how we meet our goals, and also solve affordability issues. We'll just welcome the opportunity to kind of keep that dialogue going.

Okay, well, obviously it's something we're really interested in and we really want to make happen. And there's starting to be some urgency just because I mentioned to you that I have a longtime activist friend in Santa Cruz who is required on a fixed income and every other month sends me the copy of her PG&E Bill saying how am I supposed to be able to afford this? And my only response is I bring it up at Rules Committee hearings so that she at least feels heard. But we're trying to limit our questions.

So let me use my second question as a follow up because there is now the proposal that's out there to do a sliding scale based on income for utility rates. And the first blush, and I have only read it cursively, but it sounds like if you make over 100,000, you're in the same rate category as somebody that makes a million. And how do we design a rate system that just genuinely differentiates between working people and people that have wealth? If we're going to do that, how do we make sure that that's the distinction that we do in the rate system?

Thanks for that question. I think I'll stay fairly high level on answering it.

But is that because you've got some kind of proceeding and you have to watch yourself?

Of course, yes, we have a proceeding. We have comments that are in the proceeding. There has not been a PUC proposal. There have been proposals from parties for how certain things should be done. But backing up to what we, I think, need to do with that proposal. What's being considered is an income based or an income graduated fixed charge.

And per the legislation that we're implementing, there have to be at least three categories of income. So it's not necessarily that it has to be further graduated than that. Although the PUC can consider other gradations now. Right now in the system that the Public Utilities Commission regulates, rates are volumetric. So in other words, if you use zero electricity, you're not paying into the system. As you use more at different increments, you pay more.

And that's not the case in actually many municipal utilities. In many municipal utilities you have a certain fixed charge that represents that just reflects the fact that keeping that infrastructure in working order for people to use costs money almost regardless of how much they use. And then on top of that, providing electricity at different levels of use has an additional cost associated with it.

So one of the things that the fundamental part that we're looking at to start with is what's the appropriate and fair fixed charge with the additional layer of having that be in some reasonable way reflective of income per per the legislation. And so what it you know, what is one of the things that we are going to have to do as we look ahead at how our system is changing, how technologies are changing, how people use energy is we are going to have to make sure that we can pay for the system that we all need and that we all use in a reasonable way. I do think that the opportunity that has been given to us to look hard at that issue, to take in comments and to consider proposals and put forth a proposal is a really important one.

And all of us commissioners on the PUC will be taking that seriously and paying close attention to it, whether we are assigned to it or not. But without any doubt, unless someone is off grid, everybody is using the distribution system. Everybody is using it. And so we do have to figure out what is the most fair and appropriate way to continue to support that system for the benefit of the state.

Well, thank you very much and appreciate that high level comment. And I think that it just goes without saying that the questions represent at least my priority and many of those probably in the Legislature and that over time we will want to work on those priorities to make sure that we get toward those goals. I appreciate your response and if I'm not here when the roll call comes up, I will be a yes vote whenever I can get back. So thank you.

Thank you, Senator Laird.

Thank you for the consideration, Madam Chair.

Thank you, Senator Laird. Senator Ochoa Bogh.

Interestingly enough, we had the same conversations and questions as my colleague from Santa Cruz. So we share the same concerns and he is absolutely right. I think we share the concerns on behalf of many of the Members that many of our colleagues, I'm sure.

So having had him ask those questions, I'm going to go and touch upon the question that we discussed in our office, which was with regards to the study or the investigation into the rise of the cost of the rapid cost of increase in gas prices last winter. And I'm going to follow up with two questions and you can elaborate on your time and one has to do with the time period, the estimated period of the investigation, which is about three years and the concerns expressed with regards to being a very lengthy period of time in order to do all of the investigations. And by that period of time it's, in my opinion, a bit hard to hold people accountable and the risk that comes from the possibility of occurring again on that end.

And what did we learn with this past experience of last winter and is there anything that we're mitigating in order to avoid those rapid cost increases without preparation on behalf of our constituents, especially the vulnerable ones we spoke about.

Absolutely. And thank you for that question and for the time yesterday. So I knew when I was writing the responses to the question that nobody was going to like the answer to how long the investigation was likely to take.

One of the things that I put in the response, and that I want to emphasize now, is the fact that it may take a certain amount of time to get from start to finish to voting out. The outcome of an investigation doesn't stop us and can't be allowed to stop us from identifying useful actionable steps that we can be taking from what we're learning as the investigation continues. Because the last thing we want to do is hold off on using any of this information until we have it perfect and done.

And in the meantime, what about this winter? What about next winter? And so we have to continue to be learning as we go. It starts, I think, with what did we learn about the challenges and the actions taken to notify people of the changing the rapidly increasing natural gas prices? Because for a lot of people, unfortunately, if you were not signed up to get text messages from your utility if you weren't reading your emails from the utility over the holidays, you may not have known that prices were spiking. You may not have been aware that you even should be taking actions to reduce natural gas use to the extent that you're able.

For example. And so one of the areas that we absolutely have to look at is how do we improve our ability? And of course, largely it's the utilities outreach to their customers so that people are notified of what's happening. How do we use what we learned from the assessment that we've done? And we did have an enbanc and that means all the commissioners come and we have a basically hearing or workshop on what happened and we did get a lot of good information from that.

How do we use what we have learned and what we are learning to put the state in a better position to be able to mitigate some of these swings in prices. And that has to do with looking at how we use storage, for example, and considering other you know, we don't directly regulate commodity prices. It very much was a westwide event, it wasn't a California specific event.

But that doesn't mean that there aren't things we might be able to do to be able to be in a better position to respond either on the natural gas side or on the electricity side. Because we have to pay attention to the fact that the spike was in gas prices, but it very much impacted electricity prices at the same time. So that's not a perfect answer.

I will go back and drill down in that timeline and look at that. We're hopeful that there's going to be a federal investigation just because of their process, we don't actually know. But the Governor requested a FERC investigation of the event as well. So I do think it's very important that we get to the bottom of what happened, to the best of our ability, and that we take real steps to mitigate the impacts of such an event, were it to happen again. Thank you.

Senator Smallwood-Cuevas.

Thank you, Madam Chair, and thank you, Ms. Douglas, for our opportunities to meet and to chat and for your very substantive responses today to the questions being asked. I learned so much in these spaces, and we spoke about engagement on the call, and and I'm glad that you reiterated that here today.

I wanted to just follow up on the intersection that I'm most concerned about, and that is sort of the root causes of compounded poverty, and how do we ensure that our investments in the PUC, in innovation, and infrastructure, how do they become multipliers in terms of building the infrastructure we need, but also addressing those communities, so many that are most impacted by environmental racism and economic inequality?

We just had the Governor signed SB 150, which is calling for community benefits to be a part of how we do our infrastructure work moving forward, using all of the federal infrastructure dollars and climate resiliency funding, which is a tremendous opportunity.

But juxtaposing that with the role that the PUC plays, particularly around charging infrastructure deployment. Looking at for me, the lack of EV charging in communities of color and low wage working communities that have the Cal Enviro Screen scores that are the most appalling. What is it that the PUC is doing, not just to bring infrastructure, particularly EV infrastructure, to marginalized populations, but how are we thinking about including things like job training, like local hiring, so that these projects become a multiple benefit to communities?

Yeah, thank you for the question and for the conversation that we were able to have. I think there are tremendous opportunities here for communities, and especially employment opportunities for people who are interested in this field because we have so much need for infrastructure development throughout the state, and that occurs across safety, across interconnecting distribution, system upgrades, transmission, projects, and so there are opportunities.

And in a lot of ways, finding the trained workforce that's able to do the work can be a barrier to doing the work as quickly as we might otherwise be able to do it. And so there are real opportunities. We have an MOU.

The PUC has an MoU with the Workforce Development Board, and we try to get their input in the programs that we have, where workforce training may be a part of it. We do get reporting from some particular programs where workforce training is absolutely a part of it. And I can share with you some of the kind of detailed responses. I think I actually did, but I can make sure that you get them in terms of some of the workforce training and actual follow on employment from certain programs.

That being said, I think there's a lot more that can be done, and some of it is about what the CPUC can do directly. I think a lot of opportunities are going to come from the utilities and from developers, and we may need more of a coordination effort to really capture some of those and make some of those connections. There are also opportunities for federal funding in the workforce space.

Of course, the state's putting a lot of funding into workforce training and helping that come together to support the energy transition and the electricity and energy work that needs to be done is really important. It's definitely something I'd be interested in following up on.

I appreciate that. And I was curious, has there ever been an effort to embed community benefit sort of frameworks inside of the EV infrastructure space?

I don't know the answer to that. I'm more familiar with the EV infrastructure grant programs initially through the Energy Commission and so I don't think there is. But I can't really speak to that.

At the PUC, what we would be looking at is particularly starting with are the utilities in a position where they can energize the infrastructure and just get it connected and get it working. As we prioritize rolling out EV charging infrastructure in communities that don't have a lot of that investment already where we really need investment, is the system ready? Because it doesn't do you any good to show up with a bank of chargers if it can't be connected to power and work.

So a lot of the focus that we need to do with the PUC is just making sure the utilities know that they have to get the system ready because the chargers are coming, and we don't want people left behind and not getting chargers because maybe their area has been underinvested in. So, I think that's where we start and build from there.

Well, thank you for that and for the invitation to continue to work in this space. And I really want to, also just going back to the point ,and this is my second question in terms of the outreach, because you talk about outreach, I often say engagement because I feel like it's a two way process. And whether it's "Why are the costs spiking?" to "How do we ensure those communities that need support to pay their bills actually know that these jobs are an opportunity?" it also has to deal with that internal engagement infrastructure.

And we had the public advocate come before us and share that they had one engagement staff for the 20 million plus ratepayers. And we talked about ways that the PUC might be sort of thinking about considering engagement and ways to build those kinds of partnerships. I'd love for you to share that with the rest of the Members today because that was an interesting perspective.

Yeah, absolutely. Thank you. I think the public engagement side of what we do is so important and it's an area that we need to think about how we can do better.

One of the things about the way the PUC often works is that you will have engagement around a program or around a proceeding and it's often very thorough and there will be noticing, and there could be letters and there could be outreach of various kinds, and there are certainly efforts to help people sign up for programs and help people potentially fill out one application rather than multiple applications to get into programs where they may qualify for multiple programs. So the CPUC does have an engagement infrastructure. It can be program by program.

And part of what we talked about that I'm really still thinking about is the broader question also of helping people understand when they hear about a potential rate increase or they experience a reliability issue where, like, back in September, we had ten days of flex alerts. We have to find a way of communicating with people. I think a lot of people don't know how extensive, how deep the changes are that are occurring in our energy system, or how quickly those changes are occurring and how they both can benefit from them.

But also what is the trajectory, what are the costs, and what are the benefits? And it's not only, for example, the environmental benefits of something like electrification and those benefits are real, but it's also, as we electrify, as more people are using electricity, those costs are spread out over more use, people's all-in energy bills.

When you have somebody who has an electric vehicle, they'll see their electric bill go up, their gasoline costs will go down. What is that all-in cost? What's our vision? What are some of the milestones? What are some of the ways that people can see overall how they may be impacted and how they can maybe benefit? And I think we need to kind of think through what that communication looks like. That's not just a PUC thing.

In some cases, maybe it's Energy Commission or maybe it's ARB. But I think we have to help paint the vision because for people who do their work and pay their bills and don't pay much attention to the energy world it wouldn't be all that surprising if they haven't seen how great the rate of technology change, how great the rate of change has been, infrastructure change.

And there's more that's going to be needed to really get where we're going. The conversation is different for people in urban areas where you might be talking about how do we make sure they have access to vehicle charging? What are the opportunities with storage, with solar, with heat pumps? What's some of the work that needs to be done so that certain communities can take advantage of those technologies, can participate in those technologies, going back to permitting and building clean energy so that we can meet demand.

There's the land use side of it, there's the transmission permitting side of it. And so I do think that we need to be maybe more concrete with what this looks like. I'd really welcome your thoughts, as I said when we met, on how to do that and how to have some of that communication. Thank you.

Thank you. I'll follow along on that because I think, obviously, this onus is on all of us, not just you. You are one of the most experienced people in this know for quite a long time.

So those of us who are more laypeople (I'm not going to include Mr. Laird, who's not here right now, in that he doesn't get to be included in the layperson definition), but when we talk about, as you were answering Senator Smallwood-Cuevas' question and expanding at the very end, you talked about storage and charge stations and participating in technologies. Some of the communities I represent don't even know what that means. They don't benefit from any of that. Not yet. And much like my colleague Mr. Laird, I'm trying to figure out how to explain to my constituents.

I have communities of affluence, I have friends that have EVs and they participate in a broad range of all of these things. But I have constituents that do not and they have no mindset nor the ability to even fantasize about that. And so for me to be able to try to wade through this and explain to them, as costs continue to go up, because you've got to spread the cost in order to deal with the infrastructure to meet our climate goals--that we put in place, by the way. We put those goals in place for a reason, understanding the significance.

But, I don't have a question. This is the struggle I have because those were my family Members. We barely got an increase in wages, which people yell at us about for trying to figure out how to increase wages for regular working people, they barely get that increase and the next thing you know they've got an increase in electric rates and gasoline prices and natural gas. So, that's my dilemma as much as it is yours.

I'm glad you're the expert to understand how to kind of piece these things together. But we do have a challenge. We really do. I appreciate where we're trying to go and we're only going to get there if we take these steps.

But what you learn in the proceedings as you look at this. First, Senator Laird talked about the proceeding, which is about the fixed charge, or fixed rate, and what is that going to mean for low-income people is really what I'm most interested in, because some of the rest of us are fortunate enough. We may not want to pay more, but we now have the opportunity to take on that cost, whereas my neighbor may not.

To a different issue. So it's our challenge. It's our challenge. And what you learn as you go through that proceeding, I think we really need to hear and our policy committees may ask our budget committees as we, sub-budget committees may go into that at the beginning of next year as we get into the next budget cycle. Budget sub two.

But, on another related, and this may be simpler, I know that you've looked at this and you made some comments in written responses to the Rules Committee: Delays in electricity hookups. That is the other thing I hear from others who are trying to build projects in some areas of the state and the delays. We're trying to increase housing.

We have that dilemma in the state, that challenge. What are some of the things you're finding when you look at what's causing some of those delays? What options do we have? And clearly these are IOU kind of issues, but you look at that, what can you tell us about that aside from what you put in writing?

Well, there are the near term things that we can do about that, and then there is longer term. And I just want to start by saying we really need timely hookups, whether it's of generation or energizing customers, we need to be able to get the stuff hooked up, whether it's a charging station or affordable housing complex or a business. And so, in the immediate term, because of the importance of this, the PUC does have sort of an informal team of staff that when we get complaints, we'll try to problem solve with the utility.

And that has been successful in times. It's not always successful, but when you're doing that, you're kind of thinking about a patch in a way. The utility might say, well, for this use to be hooked up without disrupting the system, a certain upgrade needs to be made and that will take two years.

And then you're sort of saying, well, is there a way, can something intermediate be done? You're troubleshooting. You're trying to solve the problem. Ultimately, what we need to do is we need to get to where upgrades are made in the distribution system.

This is really, we're talking about customer hookups in the distribution system so that the energizations can be made timely. And so that gets into what takes a bit longer, which is like in the general rate cases, just making sure, just really pushing them on what they're proposing. And does it solve this problem? Because it's not okay for somebody to be expecting a certain date to be able to come online or be energized and then to find out that it's a year later or something like that.

In the near term, we are trying to work with the utilities and troubleshoot where we can. Over the longer term, it's really about using the oversight that the CPUC has and pushing to make that a priority.

So I got your point. I think it's when rate cases are before you from individual IOUs, you have the ability to leverage and say you are not meeting these criteria. Okay? Otherwise you've got oversight. And what does that look like? How do you get to address it in oversight? What's your process for that?

Okay, so there is the informal process which we talked about right? And it's just the communication typically through staff, that this isn't okay, this is taking too long. Sometimes there can be solutions that come from the utility reallocating resources internally. And so that's another avenue that's informal where if a problem becomes so acute, the utility might change the way it manages or change the way it approaches or the staff.

It allocates to something. But we do have to understand that when they do that, they're probably moving people from somewhere else. And so they'll be quick to say, well, okay, we can prioritize this, but it'll have an impact over here on something else. That is something that has to be balanced as well. Customers can raise complaints as well within the CPUC process. I've been there six months.

I couldn't describe right now how that works. But I really think in terms of an issue like timeliness of energization, it's really some of these things that I've been talking about, it's the informal communication, it's the messaging from both the staff and the commissioner level that this has to improve. And then the certain interactions, like around a rate case where you're like, okay, show me that what you're proposing addresses this and how and where or where doesn't it?

I don't know if this helps or hurts, but if you're in one of those rate cases, you might suggest that the Legislature ask you this question as you were being confirmed, and we want an answer too. At any rate, the last question I have really is just to get your sense, given that the commission is responsible for the Administration of several of the broadband programs and initiatives, and just to get your take, although early in your tenure, how are you kept apprised of the progress made on how that program is going? It was one of our biggest concerns when we received the money and we designed a program. And how do you feel it's going? What are your early assessments of it?

I've followed the program relatively on a fairly regular basis when I started. I got a series of briefings on calendar, including from the Communications Division. It started with broadly, these are the things we're doing, but it pretty quickly honed into the Bead program and the efforts that the staff was making to be in a position to get money out the door quickly.

And so they did keep me apprised of it. And I think we have managed to get to a pretty good point with that program where I think the funding can go and the application period is open. So I do appreciate their work there.

I will continue to stay engaged and understand. We've talked mostly about electricity here, but of course we have our gas utilities, we have the communication side, we have water utilities, and so we have the transportation side. And so staying on top of all of that is important.

Thank you. I will go to Members of the public now, I would say I think the PUC has a lot on its plate, it's a lot to monitor and a lot to follow. So thank you for your thoughtful comments on all of these questions.

I'm going to ask people right here. We're going to go to the public and we'll put the number back up on the screen, if we could, because we will go to the telecommunication or telecom service in a minute. That toll free number is 877-226-8163.

The access code is 161-8051. So we'll go right here now in room 2200 to those who wish to testify in support, that would be your name, your hat or organization, if any, and very short comments because I see a long line. So, two sentences. Welcome.

Madam Chair, John White with the Center for Energy Efficiency Renewable Technology. We thank the committee for its excellent questions. We thank the Commissioner Douglas for her public service and we look forward to continuing to work with her. Thank you.

Thank you so much. It's good to see you. Welcome.

Jan Smutny-Jones with the Independent Energy Producers. And I think, as Chair, you pointed out earlier, this is perhaps over the last 35 years one of the most qualified appointees before the Senate. So I would highly encourage you to confirm her. Thank you.

Thank you.

Thank you so much. Next witness. Welcome.

Good afternoon. Mikayla Elder on behalf of Environmental and Energy Consulting as well as our clients Cal Start, the Building Decarbonization Coalition, Electric Vehicle Charging Association, and Valley Clean Air now in strong support of Karen Douglas' confirmation. We believe the people of California will be well served by her role as Commissioner of the CPUC. Thank you so much.

Thank you. Welcome.

Good afternoon, Madam Chair, Members of the Committee, Mark Aprea with Aprea and Micheli here on behalf of our client ChargePoint. We want to first thank Governor Newsom for appointing Ms. Douglas to the PUC. She's got great familiarity with climate change, how to best address that. You certainly heard in her comments here today, her familiarity with EV charging and the needs there. And we couldn't be more thrilled, and we would respectfully request your confirming her appointment. Thank you.

Thank you very much. Welcome.

Thank you. Tiffany Fan, on behalf of California Community Choice Association. We have worked with Commissioner Douglas in multiple capacities and we're very fortunate to have her in this role and with her indulgence, support from other entities intersect power California Efficiency and Demand Management Council, General Motors, and MCE. Thank you.

Thank you. Welcome.

Good afternoon. Aaron Kunz with California Advisors on behalf of the Center for Sustainable Energy, EDF renewables, EDP renewables, Golden State Wind, Hydrostore, the Solar Energy Industry Association, and SMUD, all in support of Commissioner Douglas's confirmation. Thank you.

Thank you very much. Next witness.

Patrick Welch with the California Municipal Utilities Association. As many of you may know, the rates of publicly owned electric utilities are regulated locally and not by the PUC, but nevertheless, I'd like you to know that we have worked with Karen for many years and we can testify to her character, which we think is of the highest caliber.

We worked really closely with her during that ten day heat wave in September. Throughout the entire ten day event, she maintained a thoughtful, level headed, and collaborative approach. And we urge you to support our confirmation. Thank you.

Thank you. Thank you very much. Welcome

Madam Pro Tem and Members, Beth Olhasso on behalf of the Agricultural Energy Consumers Association. Like my colleagues before me, we strongly support Commissioner Douglas' confirmation. We too were part of that ten day slog through that heat wave and we appreciate the thoughtful work that Ms. Douglas has done in this state and look forward to working with her on issues regarding reliability and affordability. Thank you.

Thank you very much. Welcome.

Good afternoon. Audra Hartman on behalf of the California Large Energy Consumers Association. Many people before me already commented on the energy crisis and the energy issues we had in the past years and Commissioner Douglas's calm demeanor, we really appreciated that, her extensive knowledge and her openness to meet with folks and talk about issues that still need to be resolved. So we strongly support her confirmation.

Thank you. Thank you so much. Welcome.

Madam Chair and Members, Andrew Antwih with Shah Yoder Antwih Schmelzer and Lange here today on behalf of Advanced Energy United. Ms. Douglas has been someone that we've been able to rely on and work with across multiple administrations, including short term crises like the energy slog that we've talked about in the summertime, and what we're going to have to do to get prepared for these long, hot weeks, but more importantly, longer facing issues that require planning and coordination over multiple years, including with our neighbors. Those are very important issues. We're glad to have Ms. Douglas there and we support her confirmation. Thank you.

Thank you very much. Ms. Douglas, I need to know if slog is a technical term. I've heard it twice. Welcome.

Madam Chair Members. Daniel Kim. I'm one of the partners at Golden State Clean Energy. We're the developer of the Weston Solar Park, the largest renewable energy project in California, and we are in strong support of Ms. Douglas' confirmation. She has been an absolutely amazing partner in not only supporting renewable energy in California, but also really recognizing at the very early onset of the RPS the importance of environmental justice issues and bringing communities of color to the table and making sure that they are represented in these policy discussions. So, again, thank you for supporting our confirmation.

Thank you very much. Okay, seeing no one else in line for support, let me see if there's anyone in room 2200 that wishes to testify in opposition. In opposition.

Okay, I'm going to welcome now our moderator who helps us every hearing to this and ask if you would tee people up to speak in support or opposition. And I will need people who speak to give me their name, their organization, if any, and just in support or opposition. Welcome, Moderator.

Thank you, Madam Chair. For those who wish to speak in support or opposition, please press one, then zero, at this time. Press one, then zero. And we have at least one person who signaled that they wish to speak. Just a moment. Just another moment, please. We're going to go to line 58. Your line is now open.

Hello. This is Peter Miller representing the Natural Resources Defense Council, and I'm in support of this nomination.

Thank you so much. Other witnesses, Mr. Moderator?

There is no one else.

Okay, thank you very much. We'll be back with you shortly. Let me come back to my colleagues and ask if I can have a motion. Thank you, Senator Smallwood-Cuevas. We have a motion. Madam Secretary, will you please call the role?

Laird? Ochoa Bogh? Aye. Ochoa Bogh, aye. Smallwood-Cuevas? Aye. Smallwood Cuevas, aye. Grove? Atkins? Aye. Atkins, aye. On call.

We will put this on call for my two colleagues who will be back and with our congratulations and thank you for your service, and you've already got the three votes needed, so we will get the others and then move this on to the full Senate for confirmation.

Thank you.

Thank you. Thank you for your time today. We are just going to take a few minutes and then we will shift gears and be right back.

And I will just let you know I now have Members who are really rotating between Committees. So to you I apologize and the good news is this is not your first rodeo. We thank you. It's good to see you again. Let me for the record say that we will go to our next appointee required to appear here. And this is for a Member of the Independent System Operator Governing Board Angelina Galiteva . You know it's the accent even worse since you've been before the Rules Committee before and it's good to see you again. Let me welcome you and offer to have you do opening comments.

Feel free to acknowledge anyone you would like and opening comments and then we'll go right to our Member for questions and comments before she has to run to another committee. Welcome.

Thank you, Chair Atkins, and thank you to the Members of the committee, present and not present and coming into the near future hopefully as well too. I'm very happy to be here again and very excited. And of course I wouldn't be here if I wasn't supported by the Governor and the Legislature.

So I'm really appreciative and honored that I have another chance to serve and continue the work that we have been doing in the energy transition and in building the Cal-ISO or the California ISO to become a global leader in integrating renewables and certainly a shining example of excellence. So I really want to thank the Board of Governors, all my colleagues who we work with very closely, also the energy imbalance governing body who are also partners with us in a very elegant governance solution that we are very happy to be working with in building our westwide relationships. I want to thank the excellent ISO staff, all the agencies that we work with.

Karen is a terrific example of our agency colleagues that we collaborate with on a daily basis. And I want to thank all my friends and family who are watching right now. My parents are watching, my brother is watching, my son who is at a math camp, is hopefully watching. But most of all, I really want to thank my daughter Isabella. Isabella is a trooper. She has been with me at every confirmation since she was six.

Actually, when she was six, she came up and walked over and sat with me at the table too, and was very good in listening. And we obviously made an impact on her because she declared at that point in time that this is the work she wanted to do. She was going to go into the energy field and she was going to be managing California's grid.

She did an internship at the California Energy Commission and then decided, yes, Sacramento is the center of gravity and everything that happens is in Sacramento and the world is watching us. So maybe one day I will be chair of the CEC. And now she is a freshman. Well, going into her second year at the University of California, San Diego. UCSD, yes. And she loves surfing.

She was captain of the surf team. But more importantly, she is in the Nanoengineering Department studying chemical engineering and material science because she wants to build the technologies of the future. So super proud that all of us collectively have an impact on the future generation as well. As you all probably know, I've been at the ISO since 2011. My career has been focused on energy right from the very beginning. I grew up in East Africa, Tanzania, with no electricity.

So renewable energy was kind of the easiest resource to learn from, where we had people come in and install solar panels on our missionary school and lo and behold, all of a sudden we had lights, we had water, which were two things that were very important for all of us. And that was super exciting. And then, of course, coming to the United States as the first Eastern European to study full time law here, I was dedicated to learning about energy and making sure that I could be a part of an energy transition that has an impact not only here on a local level, but has global reverberations as well.

Which is why the ISO is so interesting, because the ISO is at the center of an energy transition. The ISO is not a policymaker, but is a policy taker. And the ISO enables all of us to be able to reach our policy goals and reach them in the best and most optimized fashion.

So it's been an incredible honor to be able to participate here since 2011 and see this transition and be a part of it and see the ISO evolve from a small regional entity to a global leader that now runs the market that covers over 80% of the Greater West, 25 of the 39 balancing authorities. And we have brought in benefits in terms of tangible financial benefits to the region in terms of $4 billion since 2015, $1.3 billion in California for California ratepayers. And that is a huge benefit that we see.

And we're counting on being able to continue as we evolve the market into the day ahead market as well. In terms of integrating renewables, we've done tremendously well. And we should be happy and proud as a state because we are the leader, as I said, globally, and one of the top 15 ISOs worldwide to be able to integrate as many renewables and certainly are leading the way.

So in 2011 when I started, we had only 600MW solar and about 4000MW wind. Fast forward to today. We have 16,000MW solar. And if we add behind the meter solar as well, that's over 25,000 MW. We have 16,000 MW wind and we have, most importantly, 5000MW storage, which we installed since 2020. And by the end of September, we hope to be at 6800MW.

So that is incredibly powerful as well. Another, because I'm also the founder of Renewables 100 Policy Institute. So having been dedicated for my whole career in making sure that we can safely integrate and operate a grid that is reliable and resilient, because reliability and resiliency, of course, is most important, that we can operate a grid with 100% renewable energy.

And proud and happy to say that we achieved this goal this year for about 120 minutes and we get better every day. This weekend we were at 98% renewables on the grid, which was very exciting. Today we're at 68% renewables on the grid. You can watch everything in real time. I'm obsessive with the ISO app today, so I know what we're generating and what the prices are of renewables. But suffice to say, we're way ahead of our goals.

The issue and the challenge and the opportunities of course, are ensuring that we can do this 24-7 365 days a year, every day, in every hour of every day. So the grid is stable. We're confident that we're going to be able to have a good summer this summer and we're looking forward to continuing to improve resiliency and reliability for the future as well.

As well. We're dedicated to meeting California's policy and climate goals and know that we can enable for that to happen. We do have a lot of very hard work ahead of us though.

We can acknowledge the success. But of course we know that we have to integrate over 7000MW carbon free resources every year in order to meet the policy goals and we know we can do it. And we can continue to build that future by bringing in a more diversified portfolio because we've learned lessons.

Yes, we're very solar centric and we are blessed with great solar resources, but we do have some challenges in operating the grid when the sun is not shining. So having diversity in terms of more hydro, in terms of more wind, in terms of more geothermal, in terms of more storage and variable storage too. Not just short term batteries, but also the longer term compressed air pumped hydro and other technologies that are important to allow us to balance the grid and operate and integrate more variable resources.

We are very lucky and happy to be able to operate the energy imbalance market that has been successful for us and that has brought a lot of benefits as well. And I call that horizontal integration. The wider the footprint, the more we can integrate with other technologies and the more we can take advantage of time differences in different resources coming into California.

But also vertical integration is important, having the visibility and the interplay with behind the meter technologies through the utilities, through the load serving entities. How will the charging stations affect us, how will decarbonization affect us as we transition away from gas and we use more electricity? How do we do that? Reliably sustainably? And Senator Grove and I were talking yesterday that the energy reality to a certain extent has turned 180 degrees, right? Because we've always modulated generation. And it was always that as you had load grow and use of electricity grow, generators would ramp up in the traditional system.

Now with the variable resources, which are yes, they're variable, but highly reliable, very predictable, we know the sun will shine, we know the wind will blow, and we know that we have those resources not available at all times. So how do we shift load to follow the availability of the resources? And those are market signals that need to be sent. So that's something that we're working on and very excited to collaborate with the CEC and the PUC to ensure that those resources are aligned.

We also have to diversify even more because we need to use electricity to decarbonize not just the transportation sector, but the building sector, the agricultural sector and industry. So that interplay of additional electricity generation and additional electricity use is very, very important. I also wanted to focus a little bit on the ISO because the ISO as an agency has evolved quite a bit.

We actually are a very highly technical and a very dedicated organization to excellence and improvement. And for the first time, we have now brought in a diversity and equity expert and that will be an official position at the ISO. We also have a board that for the longest time I was the only woman on it.

Then we now have a situation of where we have a majority of women, and indeed the Chair and the Vice Chair are now, for the first time, women because we've instituted governance changes as well to reflect the needs for more diversity and depth of ensuring that we reflect that what is in our community. We also have the Department of Market Monitoring that was created as a result of FERC requesting that the ISO do that. And I'm very happy to have chaired that committee over the years of establishing it, establishing the oversight, directly reporting to the board and making sure that they have absolute independence and are able to do their job in monitoring the market and providing, of course, benefits and insight to our neighbors as well, because the Western EIM uses them quite a bit.

We're focused on security, of course, reliability and resiliency. Cybersecurity is a big issue, and as I pointed out, having the ability to do risk assessment, emergency planning, personnel training and regular cybersecurity audits is very important for us. We actually have a literal faraday cage around the ISO to make sure that cybersecurity and that we operate in a reliable and a resilient way.

We stand ready to meet the opportunities and challenges as we build this new grid together and as we enable California to meet its goals in the most optimized way. The ISO is all about optimizing, optionalities and making sure that we have the highest value, lowest cost service for all of our customers. We know the future.

And the future grid is diversified, democratized, digitized, highly decarbonized, and we stand ready to work and build it together with you. So thank you for the opportunity. I'm very happy to be here and I look forward to answering questions.

Thank you. That was incredibly substantive and I'm sure it answered many questions that my colleagues would have. I feel actually very fortunate because typically I have to reduce my questions because my colleagues ask more questions.

Did I say something?

I assure you this is almost one of the most difficult times of the year because Assembliy have committees, Senate committees are underway, and at least two of these Members serve on Committees that are meeting at the same time. And I know that Senator Laird had bills he had to present, as did both of my other colleagues. So I presented all my bills.

So of course they always let me do my bills whenever I want, so I have that advantage. My colleagues, not so much. But I do have some questions. And as my colleagues come back, let me just ask you, did you get to meet with my other colleagues this week, which has been a busy week?

I did. I met with Senator Laird. And I met with Senator Grove.

Oh, wonderful. Okay.

We had conversations. Yeah. And I met with staff for hours.

That's helpful. And of course, we get an extensive packet of information that you filled out, which is very substantive always. And particularly when we look at Cal ISO, the Energy Commission and the Public Utilities Commission, you probably have to write a book for us. And we appreciate that.

We enjoy the work. I say that we enjoy the work and I think because it does make a difference, it's gratifying to be in this field.

I see that in the multiple times that we've had the opportunity to have you before us. Let me ask which you started in the very beginning of your comments, the relationship between the Energy Commission, Cal ISO and the PUC, three incredibly important entities that we rely on, how has that in the time that you have been on Caliso, how has that improved? Have you seen significant improvement given all the things that we are up against in terms of our climate goals, our energy challenges? Will you comment on that a bit?

Yes, I've seen incredible improvement because California's energy, environment and ecosystem is governed by a patchwork of agencies and we all have to work together and coordinate. And because of the issues that we've had in terms of integrating more renewables, learning to deal with the duck curve, learning to stack resources in such a way that we can meet those very interesting operational challenges together. We've had to work much more closely and be much more aligned to anticipate and try to foresee the unforeseeable.

Whether it's a heat event, whether it's fires, whether it's the changing environment in terms of power plants being decommissioned or shut down, increase in renewables, decrease in coal, fire power plants for sure west wide and some of the ones through cooling. So the CPUC through the Integrated Resource Plan. Plans for resources.

The CEC, of course, looks at how demand will change and how demand for electricity and other resources will increase. And we collaborate together to ensure that the transmission plans and transmission planning reflects the resource needs and reflects the demand as well with the CEC and the PUC.

So does that mean staff works closely together? How often do Commissioners and how often do you communicate with, say, Ms.. Douglas or someone at the Energy Commission? Is that direct or is it staff to staff?

It's mostly staff to staff, but the relationships are there in terms of the Commissioners as well. I personally work very closely with the California Energy Commission as well as the California PUC commissioners. We know each other, we do talk to each other.

We are a part time board, so we're not a full time board at the ISO, so it's mostly staff driven. But certainly we do, on a commission and a board level, talk about these issues constantly and try to collaborate and anticipate because it is a joint effort. We also work with the ARB, we work with the Department of Water Resources and to ensure that we've got all issues covered and we can meet the changing needs of the grid and meet the policy objectives of our state.

Thank you. Let me ask quickly, you mentioned cybersecurity. Have you been in a situation where there was a concern about cybersecurity?

I know we get attacked thousands of times every day. We get briefings regularly on cybersecurity. Actually, we were in Washington, DC at the end of May for meetings with FERC Commissioner Two and other ISOs. This is a prime issue on everybody's mind after the Colonial pipeline debacle. We don't want to have vulnerability on the transmission side.

All of us are very concerned about we're concerned about physical security of some of the substations as well. And I know that FERC actually, for the first time, is also instituting a cybersecurity office. They wanted to make sure that everybody has the security clearances necessary to get the briefings. But ISOs and energy infrastructure is a prime target for cybersecurity. And I know that we constantly have to work with experts to stay ahead of the threats and ensure that we've got the system well protected.

Okay, thank you. Because I intend to go nowhere as Chair of this Committee. Let me just ask Senator Ochoa Bog, I know you are still coming and going. Do you have any question you would like to ask? Yes, please go ahead.

Madam Chair. So my question has to do with the reliability of where we are. And I'm not sure if the question has been asked, so I apologize if it has. You can say we've already addressed it and I can get the information afterwards. So, based on your experience on the Board thus far, I have to ask, are we prepared for the summer or Mid-July this summer?

Okay, so we are good. I know many people are really concerned about where we've been and where we're going. So having said that, so you say we have enough energy reserves, assuming yes, to cover the potential heat waves.

And wildfires. In your view, what are the key challenges right now that the state is facing in maintaining the grid reliability in the future, as well as particularly relating to the increasing share of renewables on the grid?

Yes. And that's the biggest opportunity, right? I like to think in terms of opportunities, not so much challenges as we continue to meet our 2045 goals, which means we have a carbon free California operating in all sectors of the economy. And this is the fourth largest economy of the world, Decarbonized.

We are on a schedule to integrate more and more renewables, like I said, 7000 MW every year. So to meet our policy goals, we're still, even though we've achieved a lot and how I explain how much we have come and what a long way we've come and how we are a global leader in integrating renewables. We still have to integrate 17 gigawatts of solar, 3.5 gigawatts of wind in state, 1 gigawatt of geothermal, 4.5 gigawatts of out of state wind, 3 gigawatts of offshore wind would love that.

And an additional five gigawatts of offshore wind down the line as well to meet our goals. And we've got to make sure that we can operate a grid that is increasingly renewable. And even though we've reached 100% renewables on the grid, and indeed even this weekend we were at 98% renewables, we haven't done it 24-7 365 days a year, every hour of every day.

So our biggest opportunity is in decarbonizing, that stack of fossil energy that we still rely on to operate the grid, which is becoming less and less and less every year, but we still haven't gotten to the point of where we can do it 24/7. So we've got to work together to ensure that we, as the ISO, can build a transmission that's necessary to bring the resources online and bring the technologies online, both in combination of resource generation with solar, with wind, with hydropower, with geothermal that is diverse and that allows us to have power when the sun is out, because that's our biggest challenge yet. And down so that we can ramp up.

We've got a flexible need for flexible ramping of 17,000 MW as the sun goes down every day. That's the duck curve and the duck curve growth at the end of the day. So flexible resources that can ramp up quickly and that can sustain that evening peak of four or 5 hours, whether it's batteries, whether it's flywheels, whether it's compressed air, whether it's pumped hydro, then seasonal storage of course, is another opportunity that we have to look at, where we have multi days of no sun or no wind.

How are we going to be able to run a system if it's only dependent on batteries and not other diverse technologies for storage as well? So it's incredibly interesting. Absolutely fascinating. A lot of fun to look at, but very, very serious, because if we're successful, the world is looking at, you know, where I grew up in East Africa, Tanzania.

We would like for them to have access to the technological solutions we've come up with so they don't make the mistakes of building a grid that has an impact on all of us. 2.5 billion people have no access to electricity. They are on the sunbelt. I believe that as the fourth largest economy, you also have a global responsibility to make sure that we decarbonize California, we decarbonize the United States, we decarbonize the world.

You're welcome.

I have a feeling some of my senators don't know whether they're coming or going today. I've explained how challenging this period is. Senator Smallwood-Cuevas, do you have a question?

Thank you, Madam Chair. I really appreciated that answer, about what's generative here in California for the rest of the world. I understand part of a recently completed 20 year ISO transmission outlook really was looking at addressing the capacity needed for the interconnection of renewables. And the 40-ish transmission projects were recommended to really push our clean energy goals forward.

I wanted to get clarity on the ISO's role within these projects. How is ISO ensuring that clean capacity is being built out? There's been a lot of conversation about regionalization as part of building out our system, so I'm just really curious what you see the ISO's role is and particularly the capacity build out question. And then as part of that, maybe you could talk a little bit about the role.

And I always raise this in every hearing, right, this intersection of racial equity and environmental justice and economic equity, as well. Just, how in this process are you all involved in any sort of guidelines, development of -- workforce development principles that help us ensure that as California goes, that we also have our most vulnerable communities going along with it?

Well, absolutely. California, as I said, we're responsible for making sure that we do the transmission planning. The load demand is done by the CEC. The resource mix is something that is in the purview of the California Public Utilities Commission. Of course, we provide a lot of input on what the state of the transmission plan is. I believe very firmly in looking forward and planning for the future and informing any decision makers in terms of: "What are we able to do, what do we need in order to achieve those goals in the best possible way?"

And that is the signal that we send to, of course, the CEC, the PUC, the load serving entities, and those responsible for building out the infrastructure. We want to make sure that we have the transmission to, of course, build all of those gigawatts that I talked about, and that we also proactively point out what the demand is and what the growth will be so that those projects are known and people can plan for those projects where they build, how they're built, and who they're built with.

I personally have a close relationship and work very closely with some of the labor partners and the labor leaders. They're very keenly aware of a just transition and the necessity for a just transition, of retraining. And as we decarbonize the whole economy, making sure that there's a path forward not only for workers from legacy industries, but also a pipeline for the new talent that's coming in that will be building those infrastructure projects and having those green collar jobs, which are extremely important -- having pathways into high schools, having pathways into community colleges, into state schools, into the UCs, all the way to the engineering departments -- making sure that we reach out into the communities that are actually going to be hosting those projects.

We believe that many of them will be beneficial because they are carbon free, because it's clean technologies that are not going to have an adverse impact on the air quality and not going to have an adverse impact on water systems as well. We're also looking at, and I know that the state is looking at, and projects are looking at, at Justice 40, and that 40% of benefits from infrastructure projects have to flow to communities that have been disenfranchised, the frontline communities and communities of color. So that is extremely important.

Having a pipeline, whether it's former veterans that have the ability to come into the workforce, whether it's traditionally underrepresented communities, indeed, working with women in nontraditional energy industries and making sure that women have access to those jobs too, is very, very important. But I am assured by our labor partners and by the building trades that they have the training institutes, the training programs, the ability to anticipate what is needed, the will and the desire to work with project developers in order to develop the workforce that's necessary to come in and step in ready to do the EV infrastructure, to do the build out of renewable energy, to have a family sustaining job and a family sustaining career.

And be trained to do a multitude of tasks that this grid of the future and this energy system of the future is going to require because sectors that we have traditionally not looked at being part of the energy solution now are transportation -- as we electrify, transportation is part of our energy system, buildings -- as we transition to more and more electrification -- are part of the energy system. Industries are going to be using the energy system to decarbonize fuels. We're going to have to decarbonize some of the use of agriculture.

Agriculture also brings in some greenhouse gas emissions. So again, agriculture is going to be a part of our energy future as well. Our ports, our airports -- so aviation, shipping, marine time applications, all of these industries have to be addressed and we have to have a workforce that's ready to work across the board and be trained and well equipped to step into that role.

I think the opportunities are tremendous. I think the job quality is going to be much greater. I think access, diversity and inclusion is going to be greater, because a lot of the generation, the projects, will be here, not exported outside and brought into California. So, I'm optimistic about the future in that respect. And thank you for the question, that's a good one.

Well, thank you for your answer. In my mind, I imagine, "What is that grid that you look at?" I can't imagine what that looks like. I would love to tour and get a sense of how ISO just-

Oh, you should definitely come.

I would love to do that. So I'm just putting a plug in.

You have an open invitation. My colleagues are here anytime.

Thank you.

Thank you, Senator. We'll let our court reporter take a breath.

I'm sorry, I forgot to speak slowly. I get excited and I just -- sorry.

It's good that you're excited about this because we absolutely need that. I'm going to slowly turn to Senator Laird. And this has been the funnest rules committee because Members come in that do not serve on this committee and they look to say, "Where am I?" So you get a sense of why this has been the most challenging hearing we've had to date, frankly. Senator Laird, welcome back. And I want you to know -- I think I even texted you. She answered every question.

I appreciate that. People are going nuts because I need one vote to get this bill out and they want me to call somebody. So I'm going to text them the minute I ask you the question. But the thing is, I would say I just have supreme confidence in you. We confirmed you once before and I wish Senator Smallwood, well no-

I wasn't here for the first two, or first whatever, but I want to let Senator Smallwood-Cuevas know that the last confirmation hearing was the week after Texas had their energy meltdown. And I had asked her in our closed meeting, "Why are we different?" And it was such a fascinating, compelling moment that I asked it in the committee. And it was one of those rare moments that everybody put down their phone and they were all riveted, as she described the isolation Texas has.

The fact that they thought they were smarter than everybody and didn't insulate for cold with their wind turbines and only El Paso and Panhandle were connected to another state or outside, that it was the perfect storm for a complete grid meltdown. And why California was different. And it was just one of the best presentations I've heard in a rules committee. And so, given the fact that the hint has been given to me that you've answered everything in the universe already, I would just ask one question. Basically, you said in one of the questions and answers, that your job is to foresee the unforeseeable. What does that mean and how do you take that on?

2020 hindsight is always when you look back and say, should we have foreseen this? Could we have possibly known that this would happen? And sometimes the answer is yes, we should have foreseen this. And, in planning for a future that is increasingly diverse and increasingly volatile because of climate change, the 100 year storms are now five year storms. We see weather and heat impacts that we didn't see before.

We see fires and wildfires that are much, much larger and much more intense than we had seen before. And of course, that has an impact on the grid. So, we try to foresee the unforeseeable and always have a plan B, because, I also like to say we don't have a planet B, so we'd better have a plan B here for everything that we are doing. We need to, as much as we can, plan for what we think we can foresee in the future and in many instances try to look forward into the forecast of what could change. Of course, we rely on analytics. Of course, we rely on the great expertise of the ISO. The ISO has actually become-

Excuse me, I'll be right back.

-an expert in forecasting weather. I think we are better than any weather channel. They can, to the millisecond, tell you when the sun's going to shine, when there's going to be a cloud cover, where that cloud cover is going to be, how that's going to impact generation. When is wind picking up? When is wind picking down, so that we can anticipate the needs of the grid.

So, that is very important to us. And yes, using science, using analytics, and using the knowledge that we've built because of extensive experience to try to foresee what would be coming down the line as much as possible. I call it trying to foresee the unforeseeable because if something were to happen, everybody's going to look back and say, could you have foreseen this? What happened in 2020? Could we have foreseen it? A huge impact and a huge heat wave that covered the Pacific Northwest, and the desert Southwest, and the coastal areas and fires at the same time, and a low hydro year.

And, we didn't have enough storage on the grid because there were supply chain delays and a host of other issues. We're in a much better position now, which is why I'm confident for this summer. We have the storage that we need, we have a good hydro year. Hopefully we don't have the same heat impacts, but if we do, we're prepared. If we had had the resources we have today, back in 2020, the story would have been different.

I have been to Cal ISO and I have seen the room where you can see everything playing out in front of you. It's pretty impressive. Very impressive. I interrupted because I wanted Senator Laird, who will be back, to ask a question. I've asked you this before, and I'm going to ask again. I really want to understand how you think California can benefit by expanding the regionalization, that whole process. The LAO asked the question, we've asked it. How do we do that and still not have California be disadvantaged, in terms of other states?

I think we've done quite a good job with the energy imbalance market. I am very supportive of the approach that California ISO has taken as I said, in order for us to integrate more renewables, take advantage of regional resource diversity, and time difference as well, that regional horizontal corroboration is important. We've been very successful in building that partnership with the energy imbalance market, which is a voluntary market that we launched in 2015 and actually has resulted in not only reducing emissions and the closure of more fossil resources because of optimized operations across the board, but also because of integration of more renewables.

And that allowed us to bring in, back to California, $1.3 billion in benefits, $430,000,000 in the last quarter alone. And we're confident that as we grow this market to the Day-Ahead opportunity, which we are working on now, we've evolved the governance with the EAM governing body and have new governance rules. I was on the Governance Review Committee working with our statewide partners throughout the west, and I'll have to say that the trust is strong, the confidence in California is strong; and that's evident because we are also the Regional Reliability Coordinator.

The ISO was selected for all of the west, which is really great. And we know we have work to do, and we know that as we evolve those markets and transition to more and more integration, it is a technical issue that, of course, is solvable on a technical level.

It's also a political issue in terms of governance and how governance will evolve and how policymakers and policy leaders throughout the west will decide to tackle that issue together to ensure that we've got governance that's equitable across the board that represents all of California's and, of course, the other states' interests. We are certain that whatever the decision is, that what is within California's purview in terms of citing projects, in terms of resource diversity, in terms of policy goals, always stands, and that if we participate and lead a market, that market should only be a net benefit to California and our customers, and not a liability.

How do you ensure that accountability in the governance structure?

Therein lies the rub, right? I think we've got a very elegant solution with what we have now, in terms of the interaction between the ISO board and us interacting and working together with the governing body that represents the Greater West and the interest of the energy imbalance market and the future interest of the Day-Ahead market. I think we've got a very good structure in terms of our joint authority and making sure that we have decision making processes in place, but also have the ability to have the final decision be ours as the board.

Making sure that that always reflects California's best interest, and the interest of our grid, and the interest of all California consumers -- and ability to meet our policy goals, because it would make no sense to be part of a regional market and build a regional market that doesn't enable our policies to be achieved in a faster and more reliable way. And also, as an added benefit, enables other states to meet their goals, too. And many of them have ambitious goals like us.

I promise, last question. You were here when we were talking to Ms. Douglas about the cost of energy. We probably pay more in energy costs than some of the other Western states. Would this give us less costs to our customers? Our constituents? Your customers, our constituents? If we were to expand the grid in terms of the governance structure with these other western states?

I sure hope so. If the energy imbalance market is any indicator, it's been a net benefit in terms of economic resources flowing back to California and flowing to all the other members as well. Which is why there's such a huge interest in having a more integrated regional participation and market, because it is a net benefit to all states and to all participants. We just need to ensure that the benefits are distributed equitably across the board as well.

Our transmission plan is $3.7 billion for those 45 projects that we talked about that need to be integrated. That is less than a fraction of a cent per kilowatt hour, for the life of the project. So, the cost of the ISO isn't an impact on rates. Rates is much more a local issue and a utility issue. Our job, and we feel our goal, is to make sure that we have the lowest impact possible and indeed bring in more benefits to our customers and continue to do that throughout the markets.

Okay, I will follow up later, I think. Benefits to our ratepayers-

In terms of lower costs. In terms of not increasing costs, yes. And in terms of allowing our policy programs of decarbonizing the grid and achieving the climate goals in the most optimized and expeditious way and the highest value.

Okay, thank you.

What is it that they tell me at the ISO? What is our job? Our job is to optimize optionalities and make sure that we achieve everything most efficiently, meeting climate and policy goals at the lowest cost and highest value. We always try to do that.

Thank you. I am going to go to members of the public now, so I will start right here in room 2200 and ask for those who wish to speak in support. Your name, your organization you represent, if any, and very brief comments.

Great, thank you. Jan Smutny-Jones with the Independent Energy Producers. We represent utility scale renewables storage as well as the gas fleet, which also help keep the lights on under extreme conditions. I think you've heard quite a bit, you've heard before -- Angelina does a great job of basically chairing the California ISO. And I think it's the ability of being able to actually deliver on that, from the standpoint of not only our goals, but reliability as well as seeing into the future in terms of transmission planning, that I think the rest of the west is kind of looking to.

There are people who would actually like to join us, and so that's good. But I think we have to have strong leadership at the ISO, which I think she represents, as well as a great management team at this time. So I would highly encourage you to move her forward to a full confirmation. Thank you.

Thank you very much. Welcome back.

Patrick Welch, California Municipal Utilities Association. We represent public power utilities around the state, serve about eight or nine percent of the ISO load, and also represent municipal balancing authorities that have strong courting relationships with ISO. Pleased to support Ms. Galiteva and want to specifically congratulate her and express our thanks for her work on the energy imbalance market and the extended Day-Ahead market as well.

Thank you. Welcome back.

Thank you, Madam Chair. My name is Daniel Kim. I'm a partner in Golden State Clean Energy, the developer of the Westlands Solar Park. And we also support Ms. Galiteva's confirmation to the ISO board. She's been a strong leader in this position, and we continue to look forward to having her really be an intellectual beacon to be able to drive innovative policies that are cost effective for Californians.

Thank you. Next witness.

Good afternoon. Tiffany Phan in support, on behalf of a number of clients. California Community Choice Association, California Efficiency and Demand Management Council, Intersect Power, General Motors and MCE. Thank you.

Thank you. Welcome back.

Good afternoon. Andrew Antwhi with Shaw Yoder Antwhi, Schmelzer & Lange. This is a very critical time with respect to CAISO, and our neighboring states, and grid modernization, and also regionalization. So, a very crucial appointment we support on behalf of Advanced Energy Economy. Thank you.

Thank you very much. Okay-

-just to make a correction, the group has now changed its name to Advanced Energy United.

Thank you. We have that on the record. No further witnesses in support. Okay, just making sure I've covered all my bases. Let me see if there are those who wish to speak in opposition in room 2200. In opposition. Okay. Seeing no one come forward, let me go back to our moderator and say, welcome back. Would you tee up people by teleconference who wish to speak in support or opposition?

Thank you, Madam Chair. For anyone who wishes to speak in support or opposition, please press one, then zero. Press one, then zero at this time. And we're going to go to line 58. Your line is now open.

Yes, this is Peter Miller representing the Natural Resources Defense Council in support.

Mr. Miller, thank you so much for hanging in with us today. We appreciate your testimony. Other witnesses?

There is no one else.

Thank you so much for your assistance today, Mr. Moderator. We really appreciate it. I'm going to come back to the committee and ask if there is a motion. Senator Laird-

I'd like to make a comment first.

Yes.

I would like to apologize to you. I literally had to go drag somebody out of a meeting and drag them to a committee hearing to be the last vote to get a bill out. It just got out, which was what I was presenting when I left. So, I just apologize. And I'm so confident about the good job that you've been doing and you're going to do and how important it is for all the issues I wasn't able to be here to talk about. I'm very pleased to move with the confirmation.

Thank you, Senator Laird. This is his area of great interest. I would say expertise, but after listening to you and Ms. Douglas, I think it's interest as opposed to expertise, with great affection. I say that to the former Secretary of Natural Resources, because the Vice Chair is not here to say that. Okay, we will now -- Madam Secretary, would you please call the role?

Laird. Aye. Ochoa Bogh. Smallwood-Cuevas. Aye. Grove. Atkins. Aye. On call.

And we will put that on call because our colleagues will come back. But you do have three votes already, so that means you are free to go without worry at this point. And we thank you. We will move this on to the full Senate for confirmation. And let me just congratulate you, obviously, on having your daughter with you, again, here today, and you must be quite proud.

And we thank you for making sure we're going to have another woman in this field of expertise.

I am.

Thank you so much and I appreciate the opportunity to continue to serve.

Thank you. Absolutely. Have a good rest of your day. Okay, let's see. We will need to have Members come back before we can go into Executive Session. So, we're just going to pause here and wait to see if we have a couple of colleagues who are able to come back. Do I need to open the roll for -- okay, I can open the roll on item 1A.

But Laird we need on -- oh, yeah, you're right. Sorry.

We're a team.

Laird, on item one A.

Aye.

Laird. Aye. And we still need to leave that on call, correct?

For the Vice Chair. Okay, so what we will do is we will take a pause as we wait on colleagues to come back, which we will need to do before we go into Executive Session. So if we can somehow find out if our two colleagues are able to -- I realize the Vice Chair may not quite be able to come back. So we're just going to pause for a minute and we'll be right back.

I think our rules Committee can come back in session so that we can get an update on votes and close the roll. So let me ask Madam Secretary to open the roll on item 1A, the Member of the Public Utilities Commission. 1A.

Grove. Aye. 5-0.

That is out 5-0. Item 1B, the Independent System Operator governing board. Open the roll.

Grove. Aye. 4-0.

4-0. Okay, that is out. Let's go to item 3 -- oh, 2- C, D, and E. These are governors appointees not required to appear. Two California Water Commissioners and one San Joaquin Delta Conservancy Governing Board. Open the roll.

Grove. Aye. 5-0.

5-0, that is out. Item 3, referral of bills. Open the roll.

Grove. Aye. 5-0.

5-0, that is out. And we did a separation on floor acknowledgments, Madam Vice Chair. So, item 4, a request by Vice Chair Grove for a floor acknowledgment. Open the roll.

Grove. Aye. 4-0.

4-0, that is out. And then lastly, items 5, 6, and 7, floor acknowledgments. Open the roll.

Grove. Aye. 5-0.

5-0, that is out. Okay, let me thank everyone for their diligence and work today. This concludes today's public agenda. I want to thank all the individuals that participated today. If you were not able to testify, please submit your comments or suggestions in writing to the Rules Committee, or visit our website for instructions. Your comments and suggestions are important to us and we want to include your testimony in our official hearing records.

I thank everyone for their patience, especially given how difficult it was between Members coming and going from various committees to present bills and to vote on bills and other committees. So thank you for your patience, your cooperation. Thank you to our court reporter, especially, today. And with that, our Senate Committee on Rules will now move to Executive Session.