142 1 SAN FRANCISCO, CALIFORNIA, FEBRUARY 3, 2003 - 9:07 A.M. 2 * * * * * 3 COMMISSIONER WOOD: Good morning. We'll now call to 4 order the meeting of the California Electricity Generator 5 Facilities Standards Committee. 6 We will begin with opening remarks, if any, by 7 the Committee members. Chairman Kahn. 8 MR. KAHN: The only comment I'd like to make is I'd 9 like to express my appreciation to staff, both at the PUC 10 and the ISO. I know that you folks have been working very 11 hard in following up on all the comments, and trying to get 12 us in order. And I want to express my appreciation on 13 behalf of myself and also to the PUC on behalf of the ISO 14 for all of the help and guidance that you've given. 15 It's obviously a difficult thing, starting up a 16 process like this. And we couldn't have done it without 17 you. 18 I also would like to comment that, contrary to 19 the expectations of everyone, it is, in fact, true that the 20 ISO and the PUC can get along just perfectly. 21 Thank you. 22 COMMISSIONER WOOD: Mr. Bjorklund. 23 MR. BJORKLUND: I'd just like to second 24 Michael Kahn's comments. In looking at the package, it's 25 obvious a lot of work went into it. And we recognize it's a 26 difficult task, and not everyone will be thoroughly pleased 27 with it, but it's the right thing to do. And we'll look 28 forward to seeing it implemented. 143 1 COMMISSIONER WOOD: And I don't have any opening 2 comments as such, but let me make a comment on some legal 3 matters. 4 A letter came in to us from PG&E, suggesting that 5 this Committee ought to be governed by the Administrative 6 Procedures Act, and raising some other procedural matters. 7 Our preliminary legal analysis by Commission 8 staff has indicated that, in fact, this Committee is not 9 covered by that -- by the requirements of that Act; however, 10 we will issue something a little more formal in writing 11 addressing this issue sometime later, but we're proceeding 12 on that assumption at this point. 13 With respect to suggestions that we should have a 14 rehearing procedure, I am going to suggest to my colleagues 15 and rule, absent any objection, that we will not have such a 16 procedure; that there needs to be some finality of the work 17 of this Committee in a timely manner in order to forward our 18 work to the Commission for implementation. 19 However, obviously we need a structure for making 20 revisions to standards that we adopt. And we will be 21 working on addressing that in some formal way, so that 22 parties can understand how changes to already-adopted 23 standards might be made. 24 With that, I will open the floor to public 25 comment. Please limit your comments to no more than three 26 minutes, please. Anyone who wishes to comment, please come 27 forward to the microphone. 28 Okay. Seeing no public comment, the next item on 144 1 the agenda is designation of Committee legal counsel. And I 2 don't have a name to put forward at this time, but I would 3 like to ask the assent of the Committee to allow me to 4 designate someone from the Commission legal staff to serve 5 as legal counsel to this Committee. 6 MR. KAHN: If we need a motion, I'll make it. 7 Otherwise, I so assent. 8 COMMISSIONER WOOD: Thank you. It's been moved by 9 Michael Kahn to authorize me to designate legal counsel from 10 Commission staff. 11 MR. BJORKLUND: And I will second that. 12 COMMISSIONER WOOD: Okay. We already have two thirds 13 in favor of it so far, so let's take a vote. 14 All those in favor say "Aye." 15 (Parties respond) 16 COMMISSIONER WOOD: Opposed? 17 It's so ordered. 18 Next is probably the big item on today's agenda: 19 the consideration and adoption of proposed maintenance 20 standards. And for that, who from staff is going to make 21 the presentation here? 22 MR. CLARK: Mr. Clark. 23 COMMISSIONER WOOD: Mr. Clark. 24 MR. CLARK: Good morning, Commissioner Wood, members 25 of the Committee. Staff is recommending today that you go 26 ahead and adopt the maintenance -- the proposed maintenance 27 standards as they are. 28 We would -- in the review of the standards, we 145 1 have two comments that we would put forward for your 2 consideration. One is that we believe that we need to have 3 one of our legal counsel take a look at some of the language 4 of the maintenance standards, to ensure that we clarify the 5 role of the Committee vis-a-vis the role of the Commission 6 in every instance where that delineation of responsibilities 7 and authorities needs to be made clearer than it may be at 8 this point. 9 The second comment for your consideration is 10 that, as we discussed last week, we believe that the 11 standards need to address the availability of the plants 12 during peak periods. And so we would like to take a look at 13 further consideration of penalties to attach for 14 nonperformance during peak-load periods. 15 With that, we submit the standards for your 16 adoption, should you so desire. 17 Thank you. 18 COMMISSIONER WOOD: Any comment from ISO staff, 19 Mr. Pettingill? 20 MR. PETTINGILL: No. I guess I would just confirm 21 what Mr. Clark just shared with you. There is, with the 22 basis that we have outlined in the current formal standards, 23 good opportunity to go back and address the concern that you 24 and the Committee have raised in terms of availability, 25 metric or measured, during peak periods. And so it would be 26 an ideal opportunity to adopt them now, come back and be 27 able to look at adding an additional metric at the time of 28 your appropriateness. 146 1 That's all I would add. 2 COMMISSIONER WOOD: Committee members? 3 MR. BJORKLUND: Do we have any time frame that will 4 be coming back with that revision for the peak maintenance 5 standards? 6 MR. PETTINGILL: We haven't discussed what that time 7 frame would be. We could certainly put together a proposal 8 and communicate it back to you, but I know Mr. Clark and I 9 haven't discussed what that would be before this meeting. 10 MR. CLARK: I don't think it would take us more than 11 30 days to get it to you, sir. 12 MR. KAHN: I just have two questions. 13 First, as to the legal, I would assume that what 14 you want us to do is pass the standards subject to a legal 15 review of some sort; is that right? 16 MR. CLARK: Essentially a legal edit, yes, sir. 17 MR. KAHN: Okay. And then with the understanding 18 that if there were changes based on the legal edit, that we 19 would have a revised -- we'd have a motion for revision? 20 MR. CLARK: I would imagine that if -- I don't view 21 these as being any sorts of substantive changes, but 22 certainly we would issue a finalized document that would -- 23 I would imagine the process would be that it would go 24 through you for final review before it's actually put "out 25 on the street," so to speak, as the final document. 26 MR. KAHN: Well, I would defer to the ALJ as to what 27 the best procedure is. I want to assure myself that we 28 follow the correct one. 147 1 On the other, I guess I'll maybe ask the Chair 2 whether the anticipation is that we have maintenance 3 standards today and then we revise them subsequently to add 4 the peak availability, or that we not do it today, and wait. 5 What's the pleasure here? 6 COMMISSIONER WOOD: I think my preference would be to 7 adopt them today, and revise them to add the peak 8 availability. 9 MR. KAHN: And so what we would do is we would, 10 consistent with the procedure that you articulated earlier, 11 which, by the way, I agree with -- that revisions that we 12 would consider the peak availability to be a revision to 13 what we decide today. 14 COMMISSIONER WOOD: That's right. 15 MR. KAHN: Okay. Is there a motion that you folks 16 have drafted to accomplish what you wanted to? 17 MR. CLARK: No. There is no motion that has been 18 drafted, no. 19 COMMISSIONER WOOD: Let me ask Mr. Thorson: with 20 respect to making revisions after consulting with Legal, do 21 you have an opinion about the best way to proceed? 22 ALJ THORSON: I believe I agree with Mr. Clark that 23 these are probably rather minor edits to the language of the 24 proposed standards. 25 I would suggest that if the final draft could be 26 served late for you, for your individual signature, that 27 that might be sufficient to finalize the rules. I'm sure 28 your legal counsel may want to clarify that. And I think 148 1 that would be sufficient for our purposes to have a final 2 set of standards. 3 MR. KAHN: Okay. Well, then I would move the 4 adoption of the standards, subject to legal review. 5 MR. BJORKLUND: I would second that. 6 COMMISSIONER WOOD: Okay. So my understanding is the 7 motion is to adopt the standards as recommended by staff, 8 subject to the legal review prior to forwarding these 9 standards to the Commission. The suggested changes from 10 legal counsel will be circulated among the Committee 11 members. And, absent objection from the Committee members, 12 it will be forwarded with the proposed revisions. 13 If there is objection from the Committee members, 14 then we will bring those revisions back to the next 15 Committee meeting. 16 MR. KAHN: Right, with the friendly amendment to that 17 that I would, since we're going to have legal review, ask 18 the lawyers also to consider the question of whether this 19 procedure is appropriate, or whether we legally have to give 20 notice, and opportunity to be heard. And my -- the motion 21 would assume that if that is the determination of the 22 lawyers, that we'll do it the way they want to do it. 23 COMMISSIONER WOOD: That sounds good. Okay. 24 With that, I'll put the motion to the Committee. 25 All in favor, say "Aye." 26 (Parties respond) 27 COMMISSIONER WOOD: That's unanimous, and so those 28 standards are adopted. 149 1 Next is presentation by Committee staff of the 2 proposed logbooks' requirements. 3 Mr. Clark. 4 MR. CLARK: Thank you, Commissioner Wood. We have 5 before you a draft of generating facilities' logbook 6 requirements that's been developed by the ISO staff in 7 conjunction with the staff of the California Public 8 Utilities Commission. 9 We circulated this draft via the list served last 10 Friday, I believe. So folks in the room should have seen it 11 before you now. If not, there are extra copies on the table 12 at the front of the room. 13 Generally speaking, this document -- these 14 requirements set standards that must be adhered to by the 15 generator operating facilities in terms of maintaining a log 16 or -- I'm sorry -- a set of logs that record and memorialize 17 essential documentation necessary to document that which has 18 occurred at the plant. Each generating facility shall 19 maintain these logs that contain the chronological history 20 of the facility, providing detailed reference to the 21 operations and maintenance of the facility. 22 There are two types of station logs that are 23 required: the Shift Supervisor Log, and the Control 24 Operator Log. 25 In addition, two optional logs -- the Equipment 26 Out of Service Log, and the Work Authorization Log -- may be 27 utilized. And we have exceptions listed in the requirements 28 for those. 150 1 And all required logs shall be kept in both hard 2 copy and electronic formats for a minimum period of 10 years 3 from the date of the log. 4 The log shall start by recording the time of the 5 event, and the generating asset owners responsible for 6 maintaining the integrity of the generation -- generating 7 facility logs. These standards are quite detailed in terms 8 of that which is required to be kept in these logs, in large 9 part, because these logs are incredibly important for 10 determining whether or not a unit has been used. The 11 availability of the unit has been used as a way of 12 exercising market power. 13 So with that, we would submit these log -- these 14 draft logbook requirements for public comment, and for the 15 process here before the Committee. 16 Thank you. 17 COMMISSIONER WOOD: Any questions or comments from 18 the Committee? 19 MR. BJORKLUND: No. I would just say, Commissioner, 20 that I've reviewed the logs, both the Shift Supervisor and 21 Control Operator Log. And from my experience, they are just 22 exactly what we need. ] 23 They're concise, they're thorough, and there 24 aren't any omissions as far as I'm concerned. 25 COMMISSIONER WOOD: And I can't speak with the same 26 expertise that Mr. Bjorklund brings, but I would like to 27 thank staff for what looks like a very thorough and 28 thoughtful job of developing this draft. 151 1 Okay. There's no action that's needed on this 2 part, but we do have to announce a schedule for comments on 3 these logbook requirements. 4 The proposal -- and absent objection, I'll make 5 it a ruling -- is that we receive comments on February 6 24th -- on or by February 24th, and that we allow five days 7 for reply comments. That would be March 3rd. 8 Any comment? 9 (No response) 10 COMMISSIONER WOOD: Okay. Then it's so ruled. 11 Next is discussion of a schedule for developed 12 proposed operational standards. 13 And have Committee members seen the staff 14 document? 15 MR. KAHN: No. I haven't. 16 COMMISSIONER WOOD: Are there copies that were made 17 available to the public? 18 MR. CLARK: No. They've not been made available to 19 the public. I can't -- 20 COMMISSIONER WOOD: It probably would be a good idea. 21 Why don't we take a five-minute recess while 22 we're getting some copies. 23 (Recess taken) 24 COMMISSIONER WOOD: Let's come back to session. 25 Staff has provided us with a proposed timeline 26 for developing operating standards. And I think this is 27 something that appears to be very well thought out, 28 hopefully realistic. Although given the fact that we've 152 1 never done this before and the potential complexity and 2 contentiousness of the whole issue, I suspect that whatever 3 we adopt here is going to be subject to adjustment as time 4 goes on as the process works itself through. But I think 5 it's a pretty good first cut. 6 And does staff have anything to add in terms of 7 explaining this? 8 MR. CLARK: If there are any questions, I'd be happy 9 to answer any questions. 10 COMMISSIONER WOOD: I want to make one suggestion. 11 In fact, I think I'll do it as a ruling. And that is that 12 the second bullet point that the staffs of the two 13 organizations develop a statement of objectives and define a 14 set of principles, I'd like to ask Committee member 15 Bjorklund to oversee this effort and to have the staff work 16 with him under his direction to develop that. That's 17 really -- that's the starting point. And it's something 18 that certainly needs to have Committee input from 19 the beginning. Because if you take off in a direction that 20 doesn't reflect the Committee's thinking, then it's going to 21 abort the rest of it. 22 MR. KAHN: I would just make a friendly amendment to 23 that. And that is, last time we had some discussion about 24 statutory intention, and you were kind enough to share with 25 us the fact that you had participated in the creation of 26 this legislation. I think that it would be important that 27 you, Commissioner Wood, share with Committee member 28 Bjorklund your thoughts about what the Legislature intends 153 1 for us to be doing in this area and what the Legislature 2 deems important. I think Committee member Bjorklund's 3 activities in this regard ought to be informed by that. And 4 ultimately, that will be the test of whether we've done our 5 job right, is whether we met the goals of the legislation. 6 So if you can do that, I'd appreciate that. 7 COMMISSIONER WOOD: Sure. I'll be happy to do that. 8 And I think that kind of discussion wouldn't violate any 9 open meeting rules. 10 Any further discussion from Committee members? 11 Any further comment from staff? 12 (No response) 13 COMMISSIONER WOOD: Probably it's an appropriate time 14 to invite public comment at this time if there's any 15 immediate reactions from parties or members of the public 16 who are here. 17 (No response) 18 COMMISSIONER WOOD: Okay. I don't see any. 19 Then I think this doesn't take a Committee action 20 per se. I'm just going to rule that this will be the -- 21 the tentative schedule that we will follow, and it will be 22 subject to adjustments as the need arises. 23 Next is the setting of the next Committee meeting 24 date. 25 The proposal is that it be on Monday, March 17th, 26 which is Saint Patrick's Day, I think, at 9:00 a.m. Does 27 that work for the other Committee members? 28 MR. KAHN: Fine with me. 154 1 MR. BJORKLUND: Yes. 2 COMMISSIONER WOOD: Fine. That's when we will next 3 meet. 4 And the agenda so far will be discussion of 5 the final logbook requirements and also adoption of those 6 requirements, and the status report on the proposed 7 operations standards process. 8 Are there any other agenda items that either 9 Committee members or staff can think of that need to be on 10 that meeting agenda? 11 (No response) 12 COMMISSIONER WOOD: Let me just -- for 13 the information of staff and the parties: As we move into 14 the operations phase of this, ALJ Burt Mattson is going to 15 take over this proceeding. That will be -- he'll be taking 16 over that part of the proceeding at the PUC, but also he 17 will be assigned as the ALJ that will be advising this 18 Committee in that part of our work. 19 And ALJ Mattson is seated to my far right. 20 Are there any additions or corrections to 21 the service list? 22 (No response) 23 COMMISSIONER WOOD: Okay. As always, you can -- if 24 there are changes to the service list, you can contact 25 the ALJ and make those outside of the meeting. 26 Any further business? Yes. 27 MS. LODUCA: Good morning. Janet Loduca on behalf of 28 Pacific Gas and Electric Company. 155 1 When will the standards that were adopted today 2 be made available for review? 3 COMMISSIONER WOOD: I think -- are they available 4 already on our Web site? 5 MR. CLARK: They are -- they're supposed to be on the 6 Web site. I looked for it last night and couldn't find it. 7 So I'll make sure they're on the Web site and in an 8 accessible place. 9 COMMISSIONER WOOD: Okay. Can we get that done, say 10 by close of business Wednesday at the latest? 11 MR. CLARK: Sure. 12 COMMISSIONER WOOD: Hopefully sooner than that, but 13 at the very latest. 14 MS. LODUCA: Just a point of clarification. I was a 15 little confused. Are the standards that are being adopted 16 today the final standards and then they will be revised 17 subsequently, or are they -- were they adopted subject to 18 revisions? It was a little unclear. 19 COMMISSIONER WOOD: They're the final standards. 20 MS. LODUCA: Okay. 21 COMMISSIONER WOOD: All standards that are 22 established are subject to revision. In this case, it is 23 anticipated that certain revisions will be made because of 24 the incompleteness of what we adopted. 25 MS. LODUCA: Very good. Thank you. 26 COMMISSIONER WOOD: Any further comments or questions 27 from anybody in the auditorium? 28 MR. COPE: Larry Cope, Southern California -- 156 1 COMMISSIONER WOOD: Can you come forward, please. 2 MR. COPE: Sure. I'm just a wee bit confused because 3 we received something Friday that's designated Attachment B, 4 Proposed Schedule, that has a whole list of hearings and 5 meetings and so forth laid out in it relating to maintenance 6 standards, logbook standards. And if somebody could clarify 7 what the intent of all that was, we would appreciate it. 8 ALJ THORSON: Chairman Cope, what's served on Friday 9 is the order setting the prehearing conference in 10 the rulemaking procedure for the maintenance operational 11 logbook standards, enforcement of those standards. 12 The order sets next Monday as the prehearing conference. 13 And at that time, both Judge Mattson and I will talk about 14 the schedule for that proceeding. 15 And if you look at that attachment, you can see 16 that the schedule is fairly firm for the maintenance 17 standards; rather vague and incomplete for the operational 18 standards. And that was pending the Committee's decision 19 this morning about how they wished to proceed in developing 20 the operational standards. 21 MR. COPE: Okay. Thank you. 22 COMMISSIONER WOOD: So this is a notice about PUC 23 procedures and not the Committee. 24 Any further questions or comments? Any further 25 business? 26 (No response) 27 COMMISSIONER WOOD: Seeing none, this meeting will be 28 adjourned. 157 1 (Whereupon, at the hour of 9:40 a.m., 2 this workshop was adjourned.) 3 * * * * * 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28