WPCT_ +!7m#zr2ur6TeX%~|-*Qzy$8匯x*O^53 ;ꗊM;֍K3(W)8_3M~rbNtìvcjؽNJ$ńL5よAv>B۝ݷ"PCK3ʛ.:QZ#h |}{لfr $5СXͥA7烐$BvAYc0wե^,Y :.Ձ`B=hjl?5!T;tF,L`@z5 No6# UN %M 0(Sw@{4bN@Q ohg pgtgtgt 0lK 0DKKKT MU>YYYYYb;Z[ m[[[ A[ 0D_\ D3\ D+\ 0K] BL]L]L]L]L]L]L]L]L]L] AQi]] 0D^ 0D^ D/_ B7_HP LaserJet 4000 Series PCL 6HPBXLB0 (9 Z 6Times New Roman RegularX($ DEEFGEHIEJKLMFec&3|xMLevel 1Level 2Level 3Level 4Level 5A-   $    2    ݀n XXTheFY2000requestfortheDOEresearchanddevelopmentofadvancedcoal-relatedtechnologiesis  $122.4millionwhichisbasicallyflatwithFY1999budgetnumbers.However,accordingtoDOE,thisfundinglevelissufficienttopermittheCoalR&DProgramtobuildonearlierresearchthathasbroughtsolutionstoenvironmentalproblems,suchasacidraincontrol,andtobeginapplyingtheseadvancestoimprovementsthatcanreduce,oronedayeliminate,emissionsofgreenhousegasesandotherairpollutantsfromcoal.TheFY2000program,forexample,willbegintocoupleprogressmadetodateinadvancedgasificationandcombustionsystems,coalconversion,andenvironmentalcontrols,withpotentiallyrevolutionaryapproachestocarbonsequestration,inanewconceptcalledthe"Vision21Powerplex.WIEBstaffhasnotbeenabletodeterminewhatthegreenhousegasfocusmeansintermsofDOEcoalR&Dinvestmentsand,moreimportantly,whatthatmeansforwesterncoalXbX n.#n XXbV#*OLE*WPC`\ \ $519H0d0 #\ ,, ^`@W}@~}~S8(~SD(?R(~ 8Q)~H~(~8F'F'F'F'~ D&~ pB  &~<B 8p&&~A@  &~0D @8a%~x D` `%~A %~ 8@@$~0B $~@ 8$~pF $ ?$~ F `\$~ `>#$~ @0O@!$~  @> $~ =@ #~ <G 0"~ < @  @"~`p<>> "~<0 #~ ;"~p<D(~:`!~0:@0!~8 D !~ @M!~>G< B!~C  !~9@!~D #~<9  (~<C@@`$~7@ !~  p68 <#!~6 @%~?5p~5?~4>@`~3@ @3~3  ~   2? a~1a@~0D0~/?#|8 ~@0-@  Ã~tπ-@  `~ @< @@   ~ @  ~ @  ? ?  ~  ! ~ -@!@ "~ .0 ~ -<c "~  @  @ 0 ~< @=~ - &`~    ~  " 20d ~ 2x `~ @3? @ ~  ` )x  @f~ ,P  ~ -  0~ ,-?  @1~   P|~ -`~:@"D|  ~  $ 8!  8` @~    @  0$ ~ ,    ~ -<@ `0 @ `  1>   7~ .d@ @ ` ~<    ~    . @~S   @~ @E @@@~  : @` ~  : ` ~ H ~ F@  @~  @:  ~  ;0A?~ G @@ ~ @   0 E0$ ~   8`@B ~    @  ` @~ * A  p@ ~ @ 0 A `1 ~ @ @    ~ ( @04 ~38 0 ? `0B RB ~ )@0`8`c=? p ` ~   @ @ @@@ ~ )@@ @ @@ ~ (C x p@     ~  D0@  0@0   ~  <>@H 0 ~ '   ~ &@@@@ ~@      ~ @ @@ |H ~ . 8 ~ 0& B# @  ' ~  @ @  ~ '@p "     ~3 @@@x  0 ~    @B@ ~  >a0D``@ ?8   C   ? #?8~   .> ~   .  ~ G`8  ~ . @ ~;0 ~S @8 6p ~  <   ~S0 ~S@` @  ~ ;A   ~ G ~#B. 0 ~ Z@ @ ~S  ~S p ~ ;`@ p~~<<0~T@ @~T  ~  ;@0~`M` ~; "~ @ N@~ @  /0@~"<@~ @ ; ~   A  ~  ;~  `; ~   ;@~  ;~ @ A;A@~  8K~ @ 1 ~ ! @K~ I 0 ~  J @~  B ~  1@~ x@"@~  HJ D0~ G @~ Y@0~ HA @~ ` $:@~ Y~  XA~  : ~ G~ @ A~ 0 F ~  pV ~ @ V@~ 0  ;`~ @ :  ~  I@~  M ~ @ HA~ @ :~  @ 9 ~  D:@~ " B~ @@ 9~   J ~  @2  ~  9~ ` 9  ~  KA~ 5  ~  @  ~ @ ~ 0 @A~ @@8  ~ &G/~  ~  '@ @ ~  x  ~-~  @0  @~ ("% ~ 2@ ~ X1@  ~   ?~ ? @ @  ~/ ~<   ~ $* v `~ @ "<~ H)@ .~  +  ~ A>*@   ~ p À     ~  $' 8=~ @ 7&D .~  @ #  B ~   <~  .~ @  ~ %@   ~" c~@@"! .~$# -~ @!@ .~ @89~9  @-~ .~% "  ~ 7@8   ~@#  ~A-@  @ ~>H/?-~  2?-~$/`,~  @` ,~# ?,~  1 ,~   <,~1@-~  2{  ~ 3xq @+~@ 0?@ ~ $  ~   0?@ ~ $ #  |<8!~   $  ~d0?0!~ @ $H00 @!~ @ $ @$ ~  0p%~ 0   ~   "@!~`A?"~ @" ?"~@@!~ | # @#~@     0!~ || 7 !~`<2$ "~ !  .px"~ ?@.H x ~ @  @   ~B ` ~  1/ ~   !@ @ ~  @ A/!$~ (- ~      ~   @P ~   , ~    O  ~    @ ~ @ "    ~  H   ~  D@   ~    0   ` ~@     ~ !   @ @ ~   `8 ~ @   @  ~   @ @`   ~      " 0@ ~  #@0 ~0o0$ ~    `@  ~ H ~ `@! ~  0@#@@> ~   @@ ~@ @  ~   `a  ~  ~ @' ` 4 ~  3 ~+A@ ~ 3p ~ @ x?` ~A.@  ~&@ ~ B!?-@ ~ @-E  ~*0 @ ~ A  ~, ` ~.@@ ~ 2@  ~   &@ ~  @;%@ ~ ?;  ~ O ~ x  ~ ` @B~ ~ } - ~ d! ~4? @` ~ @ @P ~ @F p ~ ~ 0 '@ ~  s2  ~ @   ~  @@   @~   />~  <pBxP)  ~@ @`:8@ ~ `? 7A~  @  ~   ` P:~      ~@: ~ @  %*@ ~  0 @~  @ @ ~`<   @ @~ H@ ~ @ @D @. ~  8: @~ ? @ ~ 3 @~  2@~ <"~_  ~    ~ (@) p~ U`  ~T  @~T7 ~ <   %~+ x~+@! ~ ?$` ~     ~ ` @   ~   ~ ~1 A@  ~ ? !<@8"~%  ~|0 ?<   @ !?~ 0  0 ? ~  @@@@ @>0  x ~    A   A9@ ~  l "0 0  p? ~ `d @@B! @@ p  @~  @ 01 @  ~ (pÁ  ? @~ A!@)0@ 0 ~  @  @ `  @~  @ @~ @& ' 8~@B@&  ~  @\ !8   ~ @&0~  @@@  @` A~ A 0 ` @  H@8H@   ~80 "  ~ : @0 b$~ A@  ~ +  ?G @~8 @80~Q  ~ @B@pp  ~  "  p~$ D@ ~$  `0@~9@H@~D$ p0  ~"%@@ ~ ;@  @~  @    ~ @8@@@ ~  @~08>90 @~ @  ` 0@@~ !@>  ~D `@~ "$`@"~ , @   ~     ` ~   A x8@~ @1"@~   $@D ~   B  ~ $@@ ~ # @~ @D#   ~`~ "?3@ @>~  ` A~ @0 <0`~ @?#@  @~  `~ @0  @  ~?x 0 <~ ?   @0~D    @ ~   ?  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WPWin61[0]ࡱ `.@pWP Draw 3.0 Drawing Embed SourceWPDraw30.Drawingࡱ; \\ࡱ; WPC`\ \ $519H0d0 #\ ,, ^`@W}@~}~S8(~SD(?R(~ 8Q)~H~(~8F'F'F'F'~ D&~ pB  &~<B 8p&&~A@  &~0D @8a%~x D` `%~A %~ 8@@$~0B $~@ 8$~pF $ ?$~ F `\$~ `>#$~ @0O@!$~  @> $~ =@ #~ <G 0"~ < @  @"~`p<>> "~<0 #~ ;"~p<D(~:`!~0:@0!~8 D !~ @M!~>G< B!~C  !~9@!~D #~<9  (~<C@@`$~7@ !~  p68 <#!~6 @%~?5p~5?~4>@`~3@ @3~3  ~   2? a~1a@~0D0~/?#|8 ~@0-@  Ã~tπ-@  `~ @< @@   ~ @  ~ @  ? ?  ~  ! ~ -@!@ "~ .0 ~ -<c "~  @  @ 0 ~< @=~ - &`~    ~  " 20d ~ 2x `~ @3? @ ~  ` )x  @f~ ,P  ~ -  0~ ,-?  @1~   P|~ -`~:@"D|  ~  $ 8!  8` @~    @  0$ ~ ,    ~ -<@ `0 @ `  1>   7~ .d@ @ ` ~<    ~    . @~S   @~ @E @@@~  : @` ~  : ` ~ H ~ F@  @~  @:  ~  ;0A?~ G @@ ~ @   0 E0$ ~   8`@B ~    @  ` @~ * A  p@ ~ @ 0 A `1 ~ @ @    ~ ( @04 ~38 0 ? `0B RB ~ )@0`8`c=? p ` ~   @ @ @@@ ~ )@@ @ @@ ~ (C x p@     ~  D0@  0@0   ~  <>@H 0 ~ '   ~ &@@@@ ~@      ~ @ @@ |H ~ . 8 ~ 0& B# @  ' ~  @ @  ~ '@p "     ~3 @@@x  0 ~    @B@ ~  >a0D``@ ?8   C   ? #?8~   .> ~   .  ~ G`8  ~ . @ ~;0 ~S @8 6p ~  <   ~S0 ~S@` @  ~ ;A   ~ G ~#B. 0 ~ Z@ @ ~S  ~S p ~ ;`@ p~~<<0~T@ @~T  ~  ;@0~`M` ~; "~ @ N@~ @  /0@~"<@~ @ ; ~   A  ~  ;~  `; ~   ;@~  ;~ @ A;A@~  8K~ @ 1 ~ ! @K~ I 0 ~  J @~  B ~  1@~ x@"@~  HJ D0~ G @~ Y@0~ HA @~ ` $:@~ Y~  XA~  : ~ G~ @ A~ 0 F ~  pV ~ @ V@~ 0  ;`~ @ :  ~  I@~  M ~ @ HA~ @ :~  @ 9 ~  D:@~ " B~ @@ 9~   J ~  @2  ~  9~ ` 9  ~  KA~ 5  ~  @  ~ @ ~ 0 @A~ @@8  ~ &G/~  ~  '@ @ ~  x  ~-~  @0  @~ ("% ~ 2@ ~ X1@  ~   ?~ ? @ @  ~/ ~<   ~ $* v `~ @ "<~ H)@ .~  +  ~ A>*@   ~ p À     ~  $' 8=~ @ 7&D .~  @ #  B ~   <~  .~ @  ~ %@   ~" c~@@"! .~$# -~ @!@ .~ @89~9  @-~ .~% "  ~ 7@8   ~@#  ~A-@  @ ~>H/?-~  2?-~$/`,~  @` ,~# ?,~  1 ,~   <,~1@-~  2{  ~ 3xq @+~@ 0?@ ~ $  ~   0?@ ~ $ #  |<8!~   $  ~d0?0!~ @ $H00 @!~ @ $ @$ ~  0p%~ 0   ~   "@!~`A?"~ @" ?"~@@!~ | # @#~@     0!~ || 7 !~`<2$ "~ !  .px"~ ?@.H x ~ @  @   ~B ` ~  1/ ~   !@ @ ~  @ A/!$~ (- ~      ~   @P ~   , ~    O  ~    @ ~ @ "    ~  H   ~  D@   ~    0   ` ~@     ~ !   @ @ ~   `8 ~ @   @  ~   @ @`   ~      " 0@ ~  #@0 ~0o0$ ~    `@  ~ H ~ `@! ~  0@#@@> ~   @@ ~@ @  ~   `a  ~  ~ @' ` 4 ~  3 ~+A@ ~ 3p ~ @ x?` ~A.@  ~&@ ~ B!?-@ ~ @-E  ~*0 @ ~ A  ~, ` ~.@@ ~ 2@  ~   &@ ~  @;%@ ~ ?;  ~ O ~ x  ~ ` @B~ ~ } - ~ d! ~4? @` ~ @ @P ~ @F p ~ ~ 0 '@ ~  s2  ~ @   ~  @@   @~   />~  <pBxP)  ~@ @`:8@ ~ `? 7A~  @  ~   ` P:~      ~@: ~ @  %*@ ~  0 @~  @ @ ~`<   @ @~ H@ ~ @ @D @. ~  8: @~ ? @ ~ 3 @~  2@~ <"~_  ~    ~ (@) p~ U`  ~T  @~T7 ~ <   %~+ x~+@! ~ ?$` ~     ~ ` @   ~   ~ ~1 A@  ~ ? !<@8"~%  ~|0 ?<   @ !?~ 0  0 ? ~  @@@@ @>0  x ~    A   A9@ ~  l "0 0  p? ~ `d @@B! @@ p  @~  @ 01 @  ~ (pÁ  ? @~ A!@)0@ 0 ~  @  @ `  @~  @ @~ @& ' 8~@B@&  ~  @\ !8   ~ @&0~  @@@  @` A~ A 0 ` @  H@8H@   ~80 "  ~ : @0 b$~ A@  ~ +  ?G @~8 @80~Q  ~ @B@pp  ~  "  p~$ D@ ~$  `0@~9@H@~D$ p0  ~"%@@ ~ ;@  @~  @    ~ @8@@@ ~  @~08>90 @~ @  ` 0@@~ !@>  ~D `@~ "$`@"~ , @   ~     ` ~   A x8@~ @1"@~   $@D ~   B  ~ $@@ ~ # @~ @D#   ~`~ "?3@ @>~  ` A~ @0 <0`~ @?#@  @~  `~ @0  @  ~?x 0 <~ ?   @0~D    @ ~   ?  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J 2"  XbXXXn XXb@  SenatorThomasBill   `(n)STATEAUTHORITYNothinginthissectionlimitstheauthorityofaStatetoimposerequirementsnecessarytoensurethecontinuedreliabilityandpublicsafetyofelectricfacilitiesintheState.`(o)REGIONALADVISORYROLE B.44` hp x (#XB`(1)ESTABLISHMENTTheSecretaryofEnergyshallestablisharegionaladvisorybodyonthepetitionoftheGovernorsof2/3oftheStateswithinaregionthathavemorethan1/2oftheirelectricalloadsservedwithintheregion.`(2)MEMBERSHIPAregionaladvisorybody E+  hp x (#44` XE`(A)shallbecomposedof1memberfromeachStateintheregion,appointedbytheGovernorofeachState;and`(B)mayincluderepresentativesofagencies,States,andprovincesoutsidetheUnitedStates,onexecutionofanappropriateinternationalagreementdescribedinsubsection(f). H.44` hp x (#  XH`(3)FUNCTIONSAregionaladvisorybodymayprovideadvicetotheCommission,theelectricreliabilityorganization,oranaffiliatedregionalreliabilityentityregarding E+  hp x (#44` XE`(A)thegovernanceofanaffiliatedregionalreliabilityentityexistingorproposedwithinaregion;`(B)whetherastandardproposedtoapplywithintheregionisjust,reasonable,notundulydiscriminatoryorpreferential,andinthepublicinterest;and`(C)whetherfeesproposedtobeassessedwithintheregionare 4B(  hp x (#  XB`(i)just,reasonable,notundulydiscriminatoryorpreferential,andinthepublicinterest;and`(ii)consistentwiththerequirementsofsubsection(l). 4H.44` hp x (#  XH`(4)DEFERENCE E+  hp x (#44` XE`(A)ENTIREINTERCONNECTION 4B(  hp x (#  XB`(i)INGENERALInacaseinwhicharegionaladvisorybodyencompassesanentireinterconnection,theCommissionshallgivedeferencetothefindingsoftheregionaladvisorybodyunlesstheCommissiondeterminesthatthefindingsbytheregionaladvisorybodyarenotjust,notreasonable,undulydiscriminatoryorpreferential,ornotinthepublicinterest.`(ii)NOPRECEDENTIALVALUECommissiondeferencetothefindingsofaregionaladvisorybodyunderclause(i)shallnotconstituteprecedentoutsidetheinterconnectionunlesstheCommissionsoindicates. 4E+  hp x (#  XE`(B)INGENERALTheCommissionmaygivedeferencetoanyfindingsmadebyaregionaladvisorybody.#n  n##XbX n:#\  `&Times New Roman X $    3    _Ԁn XX_PADD_ԀIVincludesMontana,Wyoming,Colorado,UtahandIdaho._PADD_ԀVincludesAlaska,  Washington,Oregon,California,Nevada,ArizonaandHawaii.U"%$&OLE 2.0 Box <=8C HKKKK(3$ !  &&&&'dxd'dxd( $ Figure  1   d12"34C<< CLevel 1Level 2Level 3Level 4Level 5(3$ !  ($$   1  55' dxdP Pd !  MMMMMM_ 7bXXdd7@ L״LXXA.DiscussionsWithDeputySecretary_Glauthier#XbXLL״#_     DeputySecretary_T.J._Ԁ_Glauthier_ԀwilljointheBoardbetween9:0011:00a.m.onTuesday,April20.Thepurposesofthediscussionare:8  1.TovetoutfourissueswhichwesterngovernorsandSecretaryRichardsonmaydiscussatthe_WGA_ԀAnnualMeetinginJackson,WY,onJune1315;    8  2.TohearanyissuestheDeputySecretarywouldliketoraisewithwesternstates;and    8  3.ToprovidetheDeputySecretarywithfeedbackonhowwellDOEprogramsfitwithwesternenergyneeds.     DeputySecretary_Glauthier_sBackgroundfromMarch19DOEPressRelease  T    "_T.J._ԀhasservedtheClintonAdministrationwellandwearegratefultohavehimhereattheDepartmentofEnergy,"saidSecretaryofEnergyBillRichardson."HisleadershipwithintheExecutiveOfficeofthePresidentandprivatesectorexperienceadvisingFortune500companieswillprovideanewperspectivetomymanagementteam.Asthedepartment'sChiefOperatingOfficer,Iwillrelyon_T.J._'sknowledgeandexperiencetopowerthisdepartmentintoanewcentury."̀_Glauthier_'sroleasnumbertwoatthedepartmentwillincludeoveralladministrativemanagementofthedepartment.HewilldirectlyoverseetheEnvironmentalQualityandEnergyResourcesbusinesslineswhichinclude:environmentalmanagement,environmentsafetyandhealth,civilianwaste,energyefficiencyandrenewableenergy,fossilandnuclearenergyprogramsandtheEnergyInformationAdministration.Onthepolicyfront,_Glauthier_Ԁwillberesponsibleforthedepartment'sY2Kcomplianceefforts,oilandgasstrategyandtheelectricityrestructuringinitiative.Healsowillmanageenvironmentalcleanupinitiativesandsupporttheimplementationofnewcounterintelligencestepsbeingtakenatthedepartment.̀BeforecomingtotheEnergyDepartment,_Glauthier_ԀwastheAssociateDirectorforNaturalResources,EnergyandScienceintheClintonAdministration'sOfficeofManagementandBudget.HeservedasthekeylinkbetweentheadministrationandtheDepartmentsofAgriculture,EnergyandInterior,theEPA,NASA,NSFandtheArmyCorpofEngineers,andanumberofsmalleragencies.Theagencies'budgetstotalmorethan$60billioninappropriationsandemploymorethan200,000federalemployees.Hewastheadministration'sleadmanagerforbudgetdevelopmentfortheagenciesanddealtwithnumeroussensitivepolicydecisionsandnegotiationswithCongress.̀Hisportfoliocoveredabroadscopeofissuesincluding:scienceandR&Dpolicy;climatechangepolicy;energypolicy;renewableenergyandnewtechnologyprograms;nuclearweaponspolicy;NativeAmericanissues;forestandfederallands;NationalParksmanagement; ,b'+ _federalemergencyresponse;NASAinternationalspacestation;CorpsofEngineers'waterprojects;theU.S.SouthPoleStationinAntarctica;the1996FarmBill;agriculturalandenvironmentalpoliciesinGATTandNAFTA;privatizationoffederalassets,andnumerouslegislativeproposals.̀PriortojoiningtheClintonAdministration,GlauthierwasDirectorofEnergyandClimateChangeattheWorldWildlifeFund.HewasinvolvedinthedevelopmentoftheclimatechangetreatyandattendedtheEarthSummitinRiodeJaneiro.̀Glauthierspentovertwentyyearsinmanagementconsulting.HewasVicePresidentinchargeofTempleBarker&SloaneInc.'sPublicPolicyandManagementGroupandwasheadofthefirm'sWashington,DCoffice.HisspecialtywascorporateandfinancialplanningforFortune500companiesandlatereconomicandpolicyanalysesandrelatedbusinessstrategy,inenergyandenvironmentalareas.̀GlauthierisagraduateofClaremontMen'sCollege,Claremont,Calif.,andtheHarvardBusinessSchool.HeandhiswifeBrigidO'FarrellcurrentlyresideinNorthernVirginia.Theyhavefoursons,threeofwhomliveintheirhomestateofCalifornia. Background     IncorrespondencewithSecretaryRichardsoninFebruary,WGAChairmanGovernorGeringer(WY)expressedtheneedforbetterintegrationofnationalenergypolicyandthedesireofwesternstatestoutilizethediverseandsubstantialenergyresources(e.g.,wind,solar,biomass,gas,coal,oil,andgeothermal)oftheWest.Lastfall,theBoardsawasimilarneedwhenitsoughttoengageAssistantSecretaryReicherinadiscussionofhowtobettercapitalizeonthecommoninterestsofwesternstatesandDOEonenergyefficiencyandrenewableenergy.  GovernorGeringerraisedfourspecificstopicsinhislettertoSecretaryRichardson. 8  RenewableenergyintheWest. Westerngovernors,throughresolutions,  recommendationstoimprovevisibilityinournationalparksandotherClassIareas,andsignificantactionswithinourborders,havesoughttoacceleratethedeploymentofcosteffectiverenewableenergyresources.OurinterestisdrivenbytheunparalleledqualityoftherenewableresourcebaseintheWest,adesiretopositionourstatestocapitalizeonthisemergingworldwideindustry,andadesiretoimprovethewesternenvironment.DespitewhatappeartobecommonobjectivessharedbywesternstatesandDOEonrenewableenergy,littlecollaborationhasbeenforthcoming.Fromourpointofview,toooftentheDepartmentsdecisionsaredrivenbyfactorsinsidethebeltway,includingrelationswithinterestgroupsorCongressionalappropriators.ItwouldbeusefultoexplorewithyouthefeasibilityofdevelopingajointworkplantoexploittherenewableresourcesoftheWest.     8  Coalandclimatechange. Asyouknow,westerncoalisprovidinganever 8,', increasingshareofthenationsenergyneeds.Whilewesterncoalofferspriceandenvironmentaladvantagesoverothercoal,thereisloomingthechallengeofhowthenationcancontinuetocapitalizeonthisenergyresourcewhileaddressingglobalclimatechangeissues.Clearly,therearedifferencesofopinionwithinthefederalgovernmentandamongwesternstatesonclimatechangeissues.However,regardlessofthosedifferences,itappearstomethatthereshouldbeacommoninterestinexaminingwaysinwhichcoalcanbeusedinapotentialeraofreducedgreenhousegasemissions.Thiswillrequireaclearlydevelopedresearch,development,demonstrationanddeploymentstrategyandsubstantialfinancialinvestmentstretchingovermanyyears.Whilethisisahugechallenge,therewardswouldbeenormousfortheUnitedStates,aswellasforothernationsandfortheworldasawhole.TheoutlinesofthePresidentsproposedFY2000budgetforfossilenergyR&Dindicatepotentialcommongroundonthisissue.     8  ElectricPowerSystemReliability. Youhaveannouncedthatinthenearfuture D  theAdministrationwillbeproposinga finetunedversionofitselectricindustryrestructuringlegislation.Oneofthemostpressingneedsistoensurethatthereliabilityofthetransmissionsystemismaintainedastheindustrybecomesmorecompetitive.Representativesfromwesternstateshavebeenworkingcloselywiththewesternelectricpowerindustry,DepartmentofEnergyofficialsandtheNorthAmericanElectricReliabilityCounciltoseekconsensusonreliabilitylegislationthatmeetstheneedsofwesternconsumers.Progresshasbeenmade.However,theresultingdraftbillcontainsfatalflaws.Themostcriticalflawisafailuretoprovidestateswithanymeaningfulroleintransmissionsystemreliability,evenwhensucharolewouldbeonaninterconnectionwidebasis.Itissimplyanunsustainablepositiontoexcludestatesfromreliabilitydecisions"decisionswhicharecentraltothehealthofoureconomiesandourcitizenspublichealthandsafety.Wewouldbeinterestedinexploringinnovativewaysofrectifyingthisshortcoming.     8  Sulfuringasoline .TheEnvironmentalProtectionAgencymaybeontheverge  ofproposingrulestoreducethesulfurcontentingasoline.SuchrulesmayhaveaparticularlydevastatingeffectonsomeoftherefineriesinPADDIVwhicharetypicallysmallerandolderthanotherrefineriesandlessabletoabsorbthecapitalinvestmentnecessarytoreducethesulfurcontentofthegasolineproduced.Isuspectthatthecostofretrofittingsmallrefinerieswillbecomeawidespreadproblemovertimeassulfurstandardsaremademorestringentworldwide.WeareinterestedinlearningwhatactionstheDepartmentofEnergymighttaketohelpdevelopinnovativetechnologiestolowerthecostofreducingthesulfurcontentingasolineanddieselfuel.Suchnewtechnologiesmayalsohavethepotentialofreducedgreenhousegasemissionsduringtherefiningprocess.WewouldalsobeinterestedinyourviewsonthefeasibilityofestablishingapilotprogramtodemonstratesuchtechnologiesatselectedPADDIVrefineries.LeadershipinrefinerytechnologypresentstheU.S.withanopportunitytocapitalizeonworldwidemarketswhileensuringthecontinuationofahealthy 8,', domesticrefiningindustryinaneraofincreasinglystringentenvironmentalcontrols.    Followingisbackgroundinformationoneachoftheseissues.Alsoseeseparatefiles crepcpro.wpdforthecoreoftheWIEBproposaltoDOEtohelpsupportstateparticipationinworkwiththewesternindustryonelectricindustryrestructuringand wrapp2"forthecoreoftheWGAproposaltoDOEtosupporttheworkoftheWRAPPollutionPreventionForum.Botharerelativelylargefiles.   J @" > XXb RenewableEnergy #XbX  >)#Ԉ    WesterngovernorsandDOEshareacommongoalofexpandingtheuseofrenewableenergy.InrecommendationstoprotectvisibilityintheGrandCanyonandothernationalparksontheColoradoPlateau,westerngovernorsadoptedaggressivegoalstoexpandtheuseofrenewableenergy(10%ofallgenerationfromrenewablesin2005and20%by2015),andhaveestablishedtheWesternRegionalAirPartnershiptofindwaystomeetthesegoals.(SeebelowforthetextofaWGAresolutiononrenewablesandthedraftcharteroftheWRAPPollutionPreventionForumwhichischargedwithimplementingtherenewableandefficiencyrecommendationsoftheGrandCanyonVisibilityTransportCommission.)TheWesthasthehighestqualitysolar,windandgeothermalresourcesinthenation.  ItwouldbevaluabletohaveDOEpartnerwithwesternstatestoexpandrenewableenergyproductionintheWest.OneoptionwouldbefortheSecretarytocommitDOEtoaworkplandevelopedwithwesternstatesandotherinterestsintheregiontoexpandtheuseofrenewablesintheWest.  TheSecretaryandWGAcouldsignanMOUthatwould:0  *CommitbothpartiestoacooperativeevaluationofpotentialrenewableenergyproductionintheWestandanappraisalofwhetherDOEsrenewableenergyeffortscouldbeimprovedinordertoexpandtheuseoftheWestsrenewableenergybase; (#(# 0  *CommitDOEtofundtheWRAPsefforttodevelopconsensusamongdiverseinterestgroupsonactionsneededtomeettheGCVTCrenewablegoals #  1      ;(#(# 0  *CommitDOEtoestablishajointeffortwithwesternstates,theInteriorDepartmentandForestServicetoexpandtheuseofrenewablesinfederalandstateparks,forestsandrecreationareas. (#(# n XXbWesternGovernors'Association @ June30,1998Resolution98-026SUBJECT:WesternStateLeadershipinRenewableEnergyDevelopmentA.BACKGROUND1.TheWesthasthegreatestabundanceofrenewableenergyresourcesofanyregionintheUnitedStates.TheWesthasextensivehydroelectricgeneration,nearlyallthegeothermalenergyproductionintheU.S.,significantbiomassproduction,andthebestsolar,windandoceanresourcesintheU.S. \'"( 2.Thedevelopmentanddeploymentoftechnologiestoutilizetheseresourceswillhelpdiversifythewesternenergysystemandbetterpositionwesterncompaniestocompeteinthegrowingglobalrenewableenergymarketplaceandtomeetcleanairmandates.3.Thesuccessfuldeploymentofrenewableenergytechnologiesrequirescontinuingtechnologicaladvances,removalofbarrierstodeployment,andingenuitytofindandexploitnichemarkets.4.Thefederalgovernment,throughtheU.S.DepartmentofEnergy'sNationalRenewableEnergyLaboratoryandothernationallabs,hasplayedavitalroleinadvancingrenewableenergytechnologydevelopmentandinassistingindividualstatesinspecifictechnicalareas;5.Westernstatesaremakingmajorcommitmentstothedevelopmentanddeploymentofrenewableenergyresources.B.GOVERNORS'POLICYSTATEMENT1.Westerngovernorsbelievethatthedevelopmentanddeploymentofrenewableenergytechnologiescanbenefittheregionby:a.Diversifyingtheregion'senergysupply;b.PromotingthedevelopmentofnewtechnologiesandWesterncompaniesinagrowingglobalmarket;c.Reducingtraditionalairpollutantsfromenergyproduction;d.Providingasafetynetintheeventreductionsingreenhousegasesarerequired;ande.Meetingtheobligationoftoday'swesternerstotheirchildren,andtofuturecitizensoftheregionthroughcarefulstewardshipofindigenousnaturalresources.2.WesterngovernorsrecognizetheleadershipwhichindividualWesternstateshaveprovidedineffortstocapitalizeonthepotentialbenefitsofrenewableenergydevelopmentintheWest.3.WesterngovernorsrecognizethecontributionwhichtheNationalRenewableEnergyLaboratoryandotherfederallabshavemadeindevelopingtechnologieswhichenablethecost-effectiveuseofanincreasingportionofthewesternrenewableenergyresource.4.Westerngovernorswillpromoterenewableenergy,includingeffortsoftheNationalRenewableEnergyLaboratoryandotherfederallabstocontinueoutreachtowesternstatestoensurethattheirresearchanddevelopmenteffortsaregermanetothewesternresourcebaseandtherebyoffertechnologyoptionsthatcancontributetoincreasingtheavailabilityofrenewablepowergenerationandtotheresolutionofimportantpublicpolicyissuesintheregion.#XbX n1#n XXbC.GOVERNORS'MANAGEMENTDIRECTIVE1.WGAstaffshallconveythisresolutiontothePresident,theSecretariesofEnergy,AgricultureandCommerce,theAdministratoroftheEnvironmentalProtectionAgency,theNationalRenewableEnergyLaboratoryandappropriatemembersandcommitteesofCongress.2.WGAstaff,incoordinationwiththeWesternInterstateEnergyBoard,isdirectedtomonitorandshareinformationontheinitiativesofwesternstatestocapitalizeontherenewableenergyresourcesintheWest.StaffisdirectedtoseekopportunitieswheretheNationalRenewableEnergyLaboratoryandothernationallabscancontributetoachievingthepolicyobjectivesofwesterngovernors.Staffisdirectedtomonitorandreportontheprogressinimplementingthisresolution.#XbX n$=# )^$1  +&4  n XXb@Y Y WESTERNREGIONALAIRPARTNERSHIP  @d d CharteroftheAir@@||PollutionPreventionForum Mission   0   ` TheAirPollutionPreventionForum(APPF)willexaminebarrierstotheuseofrenewableenergy $ t andenergyefficienttechnologies,identifyactionstoovercomesuchbarriers,andrecommendrenewableenergyandenergyefficiencypoliciesthatifimplementedbytheWRAPwillreducevisibilityimpairingemissionsandimprovetheairqualitywithintheGrandCanyonVisibilityTransportRegion.^  (#(#  Objectives:  *    0  1.RenewableEnergy V (#(# 0   ` TheAPPFwillexamineeconomicandinstitutionalbarrierstotheuseofrenewabletechnologiesintheGrandCanyonVisibilityTransportRegion,andrecommendeconomicincentives,legislativeactionsandregulatorypoliciesthatwillincreaseinvestmentsinrenewableelectricgenerationtechnologiesandcontributetowardsachievingtheGCVTCgoalofgenerating10percentoftheregionselectricityfromrenewablesby2005and20percentby2015.(#(#  0  2.EnergyEfficiency F(#(# 0   ` TheAPPFwillexamineeconomicandinstitutionalbarriersthatimpedetheuseofenergy  efficienttechnologiesandadoptionofenergyconservationpracticesbytheresidential,commercial,industrial,andpublicsectorsinthewest,andrecommendstrategiesthatwillincreaseadoptionofenergyconservationpracticesandinvestmentsinenergyefficienttechnologiesbytheregionsenergyproductionandendusesectors. (#(#  0  3.EconomicDevelopment 6(#(# 0   ` TheAPPFwillexamineindustrialrecruitmentandeconomicdevelopmentprogramsandrecommendstrategiesthatwouldencourageandsupporttherelocationorcreationofrenewableenergyandenergyefficiencytechnologybasedindustriesintheGrandCanyonVisibilityTransportRegion..~!(#(# #XbX nު@#  <" @  > XXb FossilEnergyResourcesandClimateChange #XbX  >J#Ԉ    Regardlessofonesviewsonclimatechange,aprudentwesternenergystrategywouldseektoexploretechnologyopportunitiestopreserveandexpandtheenergychoicesintheWest.Tothisend,thefeasibilityofdevelopingtechnologiestoreduceandmitigategreenhousegasemissionsfromtheproduction,transportationanduseofwesternfossilfuelsneedstobeexplored.Wherefeasible,suchtechnologiesshouldbedeployed.  Littleworkhasbeendonetoexaminethetechnologiesthatcouldbeemployedtoreducegreenhousegasemissionsduringtheproduction,transportationanduseofwesternfossilfuelsortoexploreoptionsformitigatinggreenhousegasemissionthroughmeasuressuchasmethanecaptureandsequestrationofcarbondioxide.Manyoftheopportunitiestoreduceormitigategreenhousegasemissionsarelikelytobedependentonlocalconditions,suchasthepresenceofmarketsforcarbondioxide,theexistenceofgeologicformationssuitableforsequestration,thecharacteristicsofcoalandmethaneresources,etc.    Federalprogramstoreduceandmitigategreenhousegasemissionsarefoundinseveralagencies.Neithertheseprograms,northewesternenergyindustryhavefocusedsufficientattentionontechnologydevelopmentsnecessarytocapitalizeonopportunitiestoreduceormitigategreenhousegasemissionsfromtheproduction,transportationanduseofwesternfossilfuels.ThefocusofDOEseffortisbeginningtochange.TheFY2000budgetrequestforcoalR&Disshiftingtofocusontechnologiestoaddressgreenhousegases.  #  2      ׀Sincetheearlydaysof * theCleanCoalProgram,westernstateshavebeenadvocatesforthedevelopmentofhighefficiencytechnologies.  Whatisneededisapartnershipoffederal,westernstateandprivatesectorexpertstoexamineopportunitiestoreduceandmitigategreenhousegasemissionsfromtheproduction,transportationanduseofwesternfossilfuelresources.Theproductfromsuchpartnershipswillalsohelpindustrymarkettechnologiesandproductsoverseas.AsimilarpartnershipwouldmakesenseintheEast.  Oneconceptofsuchapartnershipwould:8  Provideaforumforidentifyingandvettingnewconceptstoreduceandmitigate "! greenhousegasemissionsfromtheproduction,transportationanduseofwestern #" fossilfuels;    8  Developaportfolioofpromisingopportunitiestoreduceandmitigate | greenhousegasemissions;    8  AdvisefederalagenciesandCongressonthedegreetowhichfederalresearch, . ~ development,demonstrationanddeploymenteffortsaddresstheopportunitiesforgreenhousegasreductionsandmitigationfromtheproduction,transportationanduseofwesternfossilfuelsandthedegreetowhichthefederaleffortswillleadtodesiredoutcomes,asdefinedbythepartnershipandtheGovernmentPerformanceResultsAct;and    8  Beempoweredtoacceptandexpendfundsfromprivateandpublicsourcesto x  capitalizeonopportunitiesforgreenhousegasreductionsandmitigationfromtheproduction,transportationanduseofwesternfossilfuels.      TheSecretaryofEnergywouldberequiredtoapproveawesternandaneasternagreenhousegasandfossilenergypartnershipwhichbestmeetthefollowingcriteria:8  Includesbroadrepresentationfromgovernors,tribalrepresentatives,fossil  energychainindustries(coalminingindustry,coalhaulingrailroads,utilities,powerplantdevelopers,engineeringfirms,pipelines,oilandgasproductionfirms),energyconsumingindustry,academiaandresearchinstitutions,andNGOsandpublicinterestgroupsintheregion,aswellasexofficiomembershipfortheDepartmentofEnergy,EnvironmentalProtectionAgencyandDepartmentoftheInterior;    8  Ensuresopennessintheconductofitsactivities;andB   8  Hasthestaffingandfinancialmanagementcapabilitynecessarytoexecuteits  mission.      Eachpartnershipwouldbecharteredforafiveyearperiodwithpotentialrenewals.TheWesternPartnershipwouldberequiredtoproducealongrangeresearch,development,demonstrationanddeploymentplanwithinoneyear.Eachyear,thepartnershipwouldberequiredtoreporttotheAdministrationandCongressonhowfederalinitiativesfitwiththelongrangeplan.  Congresswouldauthorizeandappropriate$1millionperyearforfiveyearsforeachpartnership.Thepartnershipswouldalsobeauthorizedtoacceptfundsfromstateandtheprivatesector,includingindustryandfoundations.TheSecretarywouldbeauthorizedtoprovidefinancial,travel,andtechnicalsupportrequestedbythepartnership.  R+&+ @   > XXbElectricPowerSystemReliability#XbX  > _#   m! 9)%`|0z1 `\ E  Bm  Historically,thewesternelectricpowerindustryhasreliedonvoluntarystandardstoprotectthereliabilityofthetransmissionsystemintheWesternInterconnection.Asshownin (#(#themap,eachofthefourgridsinNorthAmericaareessentiallyelectricallyisolated.  Theindustry,aswellasstateregulators,recognizethatasystemofvoluntarystandardsdevelopedintheeraofregulated,verticallyintegratedmonopolyutilitieswillnotsufficeinacompetitivemarket.Inacompetitivemarket,itwouldbeanimprudentbusinesspracticeforamarketparticipanttoincuradditionalexpensestoassurethereliabilityofthetransmissionsystemwhentheircompetitorelectsnottodothesame.(Theclassicfreeriderproblem (#(#involvingacommongood"thetransmissionsystem.)  TheNorthAmericanElectricReliabilityCouncil(NERC),whichisanindustryumbrellaorganizationoftheoneregionalreliabilitycouncilintheWesternInterconnectionandthe10regionalcouncilsintherestofNorthAmerica,wantstoreinventitselfandacquiregovernmentalpowerstomakestandardsmandatory,penalizenoncompliance,andlevyafeeonconsumerstopayforitsactivities.MMMMUnderthisMMNorthAmericanMMMMapproachthatisendorsedbyDOE,theonlyreliabilitystandardswouldbethosesetbytheNorthAmericanElectricReliabilityOrganization(NAERO),whichwouldbethesuccessortoNERC.AllstandardswouldbethenapprovedbyFERC.UnderdraftDOE/NERClegislation,FERCwouldbegrantedMMsignificantMMMMnewpowers.MMAsa publicinterestgroupstatesMMMMMMcanbemembersofNAREO.StatescanalsoengageinMMinterventionsatFERC.  WGAResolution97003callsfornewapproachestomaintainreliabilityinacompetitivemarket.Intheresolution,thegovernorsrecommendstatereviewofproposedstandardsandgovernmentaloversightofthepublicprocessesusedtoestablishandenforcereliabilitycriteria,eitherthroughanorganizationofallaffectedstatesandprovincesorthroughajointstate/federaloversightprocess.(Thefulltextoftheresolutionfollowsthisdiscussion.)TheresolutionchargestheBoardsCommitteeonRegionalElectricPowerCooperationwiththeresponsibilityofworkingtoimplementthegovernorspolicy.  Therearetwolegislativeapproachestofixtheproblem:(1)seekamendmentstothedraftDOE/NERCbilltoprovidearoleforstates;and(2)seekCongressionalapprovaltoestablisha +&+ westernreliabilityorganizationoutsideofNAEROthatwouldincludearoleforwesternstates/provincesintheoversightofsuchabody.  AmajorpublicpolicyproblemwiththeDOE/NERCbillisthedisconnectitcreatesbetweenthosewhoareheldpoliticallyaccountableforpoweroutagesandthosethathavethelegalauthoritytodosomethingaboutit.Whenthelightsgoout,consumersfirstcalltheutility,thenthePUC,thenthegovernor,thentheirstatelegislator.However,undertheDOE/NERCbill,theauthoritytodoanythingwillresidewithMMNAEROMMandFERC.  Thereissoundjustificationforencouraginguniformityincommercialpracticesacrossallinterconnectionsinordertosimplifytherulesforcompaniesdoingbusinessinmultipleinterconnections.However,thereisMMsignificantlylessMMMMjustificationformandatoryuniformityinreliabilitystandardsbetweeninterconnections.TheWesternInterconnectionischaracterizedbylongdistancesbetweengenerationandloadcenters;theEasternInterconnectionismorelikeatightlyknitnetwork.Asaresult,thewesterntransmissionsystemtendstobelimitedbyvoltagestabilityproblems,theeasterntransmissionsystembythethermallimitsoflines.Thesekindsofphysicaldifferences,aswellasthebenefitsoflocalknowledgeandlocalaccountability,argueforinterconnection(notNorthAmerican)decisionsonreliabilitystandards.  ThedraftDOEandNERCbillsincorporateprovisionsforNAEROtodefertoMMindustryMMMMinterconnectionwidestandards.TheprovisionswereaddedthroughtheeffortsoftheWesternInterconnectionCoordinationForum(whichincludesCREPC,thethreewesternregionaltransmissionassociationsandtheWesternSystemsCoordinatingMMCouncil).LAlanDavis(MT)andBillChamberlain(CA)wereleadersinthiseffort.LMMMMMMHowever,asidefromgeneralmembership,MMMMtheonlyprovisioninthebillprovidingaroleforstatesandprovincesisSubsection(d)(4)(j)whichprovidesthatwhenNAEROappliestoFERCforapprovaloftheorganization,theCommissionmustdetermineiftheproposal providesforconsiderationofrecommendationsofStatesandStatecommissions.ThisMMprovisionmaynotMMMMMMbesufficienttocomplywithMMMMthegovernorspolicy.  SenatorCraigThomas(RWY)hasintroducedelectricindustryrestructuringlegislationthatincludestheNERC/DOEreliabilitylanguagebutalsoincludesaroleforstates.FollowingisthelanguageSenatorThomashasadded: V"! n0#8($hx Q `EQttin (#(#                                (#(#  BecauseofthehistoryofwesternstatesandprovincesworkingtogetherthroughCREPCandworkingcollectivelywiththewesternindustry,theregionaladvisorybodyMMconceptMMMMinsubsection(o)isourhighestpriority.StatesintheEasternMMInterconnection,MMMMwhichdonothaveahistoryofcooperativeactiononaninterconnectionwideMMbasis,MMMMplaceahigherpriorityonthesavingsclauselanguageinsubsection(n).  MMThosearguingMMMMagainstthestateadvisorybodyMMconceptMMMMarguedthatlanguageis mandatorynotMM advisory.LLMMMMTheyalsoquestionwhystatesshouldhaveanyroleinreliabilitysincetransmissionisafederalfunction.MMHowever,MMMMthefederalgovernmenthasnotexercisedanysignificantroleinMMreliability.AsFERCChairmanHoeckersaidinAprilwhenheannouncedaFERCteamtomonitorMidwesternpowermarketsthissummer: YoumightthinkaboutthisteamasbeingfairlyinformalinnatureasfarasFERCsconcernedbecausewehaveverylittlejurisdictionoverreliability.Historically,stateMMPUCshaveapprovedcostrecoveryforthevast 8,', majorityoftransmissioninvestments.LLMMMMMM  Theargumentsforastateadvisoryroleonaninterconnectionwidebasisarecompelling:8  Astateadvisoryrolebeginstorestoreaconnectionbetweenpoliticalandlegal H accountability.    8  Sucharoleadvancesthefederalinterestinfosteringregionalsolutionstoissues  J suchasregionaltransmissionorganizations.AstheFERCCommissionershavesaidinnumerousforums,regionalapproachesareneededtocreatecompetitiveandreliableelectricitymarkets.    8  AninterconnectionadvisorybodythatincludestheCanadianprovincesfosters x  thetransboundaryuniformitynecessarytopromotereliabilityandefficientmarketsthroughouttheWesternMMInterconnection.CanadianMMMMprovinces,nottheCanadiannationalgovernment,exerciseFERCtypepowers.    8  Aninterconnectionadvisoryrolewillfosterthetypeofindustry/state/provincial F coordinationthatleadstocollectiveactionsnecessaryforasmoothtransitiontocompetitivemarketssincethepartieswillhaveanincentivetoworkoutissuesintheregionratherthanlitigatethembeforeFERC.    8  MMWithoutameaningfulMMMMroleinreliabilityMMdecisionsD,DEDstaDEFstatesFIFwillFIJmaybecompelledto t expandtheirJGFneedFGIHmHILLKwillexpandKMMstateinterventionsandlitigationatFERC,furtheroverloadinganagencywhichhasneitherthetime,resourcesorexpertisetoresolvethemyriadoftechnicalreliabilityissueswhichareembodiedinthedevelopmentandenforcementofreliabilitystandards.    n XXbWesternGovernors'Association ( AmendedJuly30,1997PolicyResolution97-003SUBJECT:ACompetitiveandReliableWesternElectricPowerSystemA.BACKGROUND1.Thewesternelectricpowersystemisexperiencingfundamentalchangedrivenbycustomerdemandsforchoice,lowercostgeneration,andstateandfederalregulatoryreformstocreateacompetitivewesternelectricitymarket.2.Thewesternelectricpowerindustryiscentraltotheregion'seconomy.AstheregionalpoweroutagesofJuly2-3,1996,andAugust10,1996,highlight,thewesterneconomyisdependentuponareliablesupplyofelectricity.AnnualexpendituresforelectricpowerintheWestareover$700percapitaor$57billion.Thisismorethanthegrossoutputofeitherthewesternmining,orfarming,oragriculture,forestry,andfisheriessectors.3.Whileratesvaryfromstate-to-state,thewesternregionhasthesecondhighestregionalaverageelectricityratesinthenation.4.Thewesternelectricpowerindustryisverydiverse.Investor-ownedutilities,publicly-ownedutilities,andfederal +B'/ powermarketingadministrationsallplaymajorrolesinsupplyingelectricityandprovidingtransmissionintheregion.Seventyinvestor-ownedutilitiesprovidenearly70percentoftheWest'selectricsupply.Nearly1,000publicly-ownedsystems,three-fourthsofthepublicpowerdistricts,ruralelectriccooperatives,municipals,regional,andfederalsystemsprovideabout30percentoftheWest'selectricity.Non-utilitypowersuppliers,powermarketers 8,'0 andbrokers,andloadaggregatorsareaddingtothediversityoftheelectricpowerindustry.5.Pastwesternstateutilitypolicieshavebeeninstrumentalin(a)cuttingthecostofenergyservicesthroughcost-effectiveconservationinvestment,(b)expandingtheproductionofelectricityfromabundantwesternrenewableresourcessuchaswind,geothermalandsolar,(c)fosteringindustry-sponsoredresearchanddevelopment,and(d)helpinglow-incomeconsumerspaytheirelectricitybills.However,themethodsbywhichthesepolicieshavebeenimplementedmaynotbesustainableinacompetitiveindustry.Newapproacheswillberequired.6.Thefederalgovernmenthasactedtoopenaccesstothehighvoltagetransmissionsystem,anecessarystepinpromotingcompetition.In1997,Congressisexpectedtoconsiderlegislationtoexpandcompetitionintheelectricpowerindustry.7.Nearlyeverywesternstateisevaluatingorhasactedonregulatoryorlegislativeproposalsthatwouldchangetheexistingstructureoftheelectricpowerindustrytogiveconsumersmoreoptionstolowertheircostsandimprovereliability.B.GOVERNORS'POLICYSTATEMENT1.WesternGovernorssupportexpandedcompetitionamongelectricitygeneratorstolowerelectricitycoststowesternconsumers.Somestateshavealreadytakenstepstopromotecompetition.Theseinitiativesneedtobefosteredandimpedimentstoincreasedcompetitionneedtoberemoved.TheGovernorsbelievethatallsegmentsofthewesternindustry,includinginvestor-ownedutilities,publicpower,federalpowermarketingadministrations,powermarketersandbrokers,andindependentpowerproducers,mustparticipateinthecompetitivemarket.Theformandtimingofsuchparticipationshoulddependupondeterminationsmadeatthestateandlocallevels.WesternGovernorsalsosupportfurtherimplementationofaccesstothewesterntransmissiongridonanon-discriminatorybasis.2.WesternGovernorsrecognizethatthewesternelectricpowersystemiscomprisedofahighlyintegratedinterstategrid.This"interstatehighwayofelectrons,"whichmovesatthespeedoflight,requiresahighlevelofcoordinationamongthoseusingthegrid,aswellasthecooperationofthoseineachstateandinthefederalgovernmentchargedwiththeresponsibilityforregulatingvariouselementsofthesystemduringthistransitiontocompetition.3.Thetransitiontoamorecompetitivemarketshouldensurecontinuedreliabilityandsafetyintheprovisionofelectricpowerservice.WesternGovernorsencourageprivatesectorsolutionsthatpromotesystemreliability.WesternGovernorsurgethewesternelectricpowerindustry,incooperationwithwesternstatesandthefederalgovernment,tosupporttheformationofindependentsystemoperators(ISO)and/orsecuritycenterstomaintainandenhancesystemreliabilityandmitigateverticalmarketpowerandfacilitateefficienttransactionsinarestructuredindustry.AlltransmissionownerswithintheareaservedbyanISO,includingfederalpowermarketingadministrations,mustbemembersoftheISO.Newapproachestoestablishingandenforcingregionalreliabilitycriterianeedtobeadopted.Thesenewapproachesshouldinclude:a.Appropriatestateandregulatorybodiestakingstepstosupportregionalandnationalreliabilitycouncilstoensurethatthenewreliabilitymanagementprocessisimplementedequitablyandpromotesthereliabilityofthewesterninterconnection; ,V'5 b.Useofapublicprocessforsettingreliabilitycriteria;c.Reviewofproposedreliabilitycriteriabystates;d.Applicationofreliabilitycriteriatoallusersofthegrid;e.Enforceablesanctionsfornon-compliancewithreliabilitycriteria;f.Mandatorymembershipbyoperatorsandusersofthetransmissiongridinregionalreliabilitycouncils;g.Governmentaloversightofthepublicprocessesusedtoestablishandenforcereliabilitycriteria,eitherthroughanorganizationofallaffectedstatesandprovincesorthroughajointstate/federaloversightprocess;andh.Examinationofpotentialformarketpowerabuse.4.WesternGovernorssupporttheadoptionof"systembenefit"chargestocontinueappropriatesupportofsocialpurposes,includingacquisitionofcost-effectiveenergyconservation,researchanddevelopment,expandeduseofrenewableenergyresources,andlow-incomeassistance.5.WesternGovernorsurgethefederalgovernmenttoworkwiththestatestodevelopeffectivemeanstomitigatemarketpowerinordertolowercoststocustomers.6.