Creates a New York independent system operator

BILL NUMBER:S7115

Title of bill

An act to amend the public service law, in relation to creating a New York independent system operator

Purpose or general idea of bill

To require the public service commission ("PSC") to monitor and oversee the operations of the New York Independent System Operator ("NYISO").

Summary of specific provisions

Section one of the bill would provides for the following:

1. Establishes the NYISO in state law;

2. Sets forth the duties and responsibilities of NYISO, including:

*the appointment process for the governing board;

*requiring NYISO to operate an open, fair and competitive wholesale electricity markets in this State;

*adopting standards for transmission facilities;

*maintaining the reliability and adequacy of the electrical network;

*complying with state laws on duties of care, conflicts of interest, open meetings and document disclosure;

*reporting requirements; and *appointing a consumer liaison.

3. Requires the PSC to oversee and monitor the operations of NYISO;

4. Describes the authority and duties of the PSC over NYISO, including:

*requiring NYISO to submit financial reports;

*inspecting NYISO' s facilities, records and accounts; *reviewing the bidding process used by NYISO; *assessing penalties for violating the provisions of this act; and *issuing an annual report on the operations of NYISO.

Section two sets forth the severability clause.

Section three states that this act shall take effect immediately.

Justification

In the late 1990's, the public service commission decided to deregulate the electric industry without legislative approval, and required utilities to divest themselves of their generation facilities. Shortly thereafter, in 1999, NYISO was formed for the purpose of creating an exchange for the sale and purchase of electricity on the wholesale market. At that time, it was claimed that

this new system would promote and enhance competition, and would result in lower costs to New York's retail customers.

Unfortunately, New Yorkers today continue to pay among the highest electricity bills in the country. These high electric bills not only place a financial burden on New Yorkers during this time of economic slowdown but, more importantly, discourage businesses from forming or coming into this state, The Legislature believes that the public service commission should be required to oversee and monitor the operations of NYISO to ensure that its actions and decisions are in the best interest of all New Yorkers.

Prior legislative history

New bill

Fiscal implications

Unknown. The bill would add new responsibilities on the PSC.

Effective date

This act shall take effect immediately.