A California bill to implement the West Wide Governance Pathways Initiative’s Step 2 proposal is headed to the floor of the state Senate after being approved by the body’s Appropriations Committee May 23. 

The committee voted 4-1 to move Senate Bill 540 — known as the “Pathways” bill — out of the “suspense” process, part of a normal procedure in which bills are examined for their fiscal impact before being advanced to the floor for a second reading and debate. 

But questions remain about the exact content in the bill, especially related to amendments. 

SB 540 authorizes CAISO to 1) transfer its state-backed governance authority over its Western Energy Imbalance Market (WEIM) and Extended Day-Ahead Market (EDAM) to the new, independent “regional organization” (RO) being developed by the Pathways Initiative; and then 2) join the RO as a participating member. (See Pathways ‘Step 2’ Bill Sets Conditions for EDAM Governance.) 

In late April, the Senate’s Judiciary Committee amended the bill to include several provisions intended to shield California’s environmental and energy policies from interference by the Trump administration through any potential backdoors opened by CAISO’s participation in the RO. (See California Lawmakers Seek to Trump-proof Pathways Initiative Bill.) 

Key among those amendments is a provision allowing the California Public Utilities Commission to direct the state’s investor-owned utilities to exit the RO if the new body’s market rules — or other public policies — become  “detrimental to California consumers;” the state’s renewable portfolio standards are “held invalid by [a] reviewing court on claims of impermissible discrimination;” or Trump or future presidents use emergency powers to require California to subsidize fossil fuels. 

Another amendment would prevent the RO from establishing capacity markets, which California consumer advocates worry would be used to support coal-fired generation the Trump administration is seeking to incentivize. 

According to one source not authorized to speak for their organization, the amendments have rankled some Pathways supporters, who are concerned the changes needlessly complicate the bill’s original intent.  

During a May 9 press briefing after the Bonneville Power Administration released its long-awaited day-ahead market decision in favor of Markets+, BPA Vice President of Bulk Marketing Rachel Dibble said the amendments “continue to erode the independence that was even in the initial bill, which we did not find to be superior to Markets+.” (See Debate Lingers After BPA Day-ahead Market Decision.)  

But the precise language of the bill emerging from the Appropriations Committee still is unclear.  

While the bill tracker on the California Legislature’s website indicates the committee voted with the recommendation of “do pass as amended,” multiple sources familiar with the legislative process said the bill could have been further altered in committee, with the previous amendments revised or potentially stripped out — although Appropriations amendments typically deal with fiscal matters. 

“Any bill that costs money or would bring in more than a certain amount of money is automatically moved to the suspense file in Appropriations. It can definitely be amended there,” according to a source familiar with California’s legislative process.  

That issue will become clearer when the Legislature prints and posts the next version of the bill, likely May 27, according to one source.