California’s State Auditor General formally began contacting thestate’s nonprofit electric grid operator (Cal-ISO) and wholesalespot power market (Cal-PX) Wednesday in a state legislature-orderedinvestigation that could lead to the merger of the two entities.The state’s electricity price spikes and supply shortfall thissummer prompted legislative action in August ordering the probe.

“We will begin cooperation with the auditors,” a spokespersonfor the power exchange (Cal-PX) said. There is no specificindication on the time frame for the investigation, although thespokesperson said. “I think they were going to turn that aroundquickly (by Dec. 1).”

State Sen. Steve Peace, the outgoing lawmaker who was the chieflegislative author of the state’s 1996 electric industryrestructuring law, requested the joint legislative investigation,saying that the summer’s electricity problems “raised seriousconcerns about the operation of the Cal-ISO and Cal-PX.”

He specifically asked that the audit look into seven areas:

“Recommend changes to the institutional structures or activitiesof the ISO and PX, including, but not limited to, addressingwhether the organizations should continue as separate institutionsand the potential value, if any, of merging the two institutions orinsuring that their operations are more closely coordinated.”

“Given that everyone is targeting other studies to the end ofNovember, I imagine that is the time frame because the legislaturecomes back for a week at that time,” the Cal-PX spokesperson said.

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