California 20252026 Regular Session Status: Passed Senate 2 D cosponsors

SB 540 — Independent System Operator: independent regional organization: California Renewables Portfolio Standard Program.

Last action — Joint Rule 61(a)(13) suspended. (Ayes 60. Noes 20. Page 3128.)

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  1. ✓
    Introduced
  2. ✓
    In Committee
  3. 3
    Passed Senate
  4. 4
    Passed Assembly
  5. 5
    To Executive
  6. 6
    Enacted

This bill has passed the Senate. Introduced February 20, 2025. It now moves to the second chamber.

Next likely step: consideration and a floor vote in the Assembly.

Prognosis

Advancing 50% · moderate confidence

Where this bill stands today.

Odds of enactment

Moderate

How often bills like it became law.

  • Passed Senate

    Current position in the legislative process.

  • 2 sponsors

    1 primary, 1 co-sponsors signed on.

  • Single-party support

    Sponsorship is currently within one party (2 D).

  • Cleared a recorded vote

    Passed 6 recorded votes so far.

Prognosis reads this bill's own signals — stage, sponsorship breadth, committee status, recorded votes and cross-state momentum. Odds come from a model trained on which bills have become law.

Summary

(1) Existing law provides for the establishment of an Independent System Operator (ISO) as a nonprofit public benefit corporation and requires the ISO to ensure efficient use and reliable operation of the electrical transmission grid consistent with achieving planning and operating reserve criteria no less stringent than those established by the Western Electricity Coordinating Council and the North American Electric Reliability Council. Existing law, the Clean Energy and Pollution Reduction Act of 2015, provides for the transformation of the ISO into a regional organization, with the approval of the Legislature, pursuant to a specified process. That process provides that modifications to the ISO's governance structure, through changes to its bylaws or other corporate governance documents, will not become effective until the ISO, the Public Utilities Commission (PUC) , the State Energy Resources Conservation and Development Commission (Energy Commission) , the State Air Resources Board (state board) , the Governor, and the Legislature take specified actions on or before January 1, 2019. This bill would delete the above-described provisions providing for the transformation of the ISO into a regional organization. The bill would authorize the ISO and the electrical corporations that are participating transmission owners whose transmission systems are operated by the ISO to use voluntary energy markets governed by an independent regional organization, only if specified requirements are satisfied. The bill would authorize the ISO, on or after January 1, 2028, to implement tariff modifications accepted by the Federal Energy Regulatory Commission to operate the energy markets whose rules are governed by an independent regional organization if the governing board of the ISO adopts a resolution, as specified, finding that each of the specified requirements have been, or will be, adopted by the independent regional organization. The bill would require the ISO to maintain the necessary technical capability to operate energy markets, as specified, and would require the ISO to continue its functions and responsibilities as a balancing authority, as provided. This bill would establish the Regional Energy Market Oversight Council, which would be responsible for ensuring that participation in regional energy markets serves the interests of the state. The bill would require the council to approve or disapprove initial participation in the independent regional organization by electrical corporations and any other participating load-serving entities and determine whether electrical corporations and any other participating load-serving entities should be required to withdraw from an energy market governed by the independent regional organization. The bill would require the council to convene a duly noticed public meeting to make a finding of approval or withdrawal of participation in the independent regional organization and would require the council to disapprove of initial participation in the independent regional organization, or order withdrawal, if the council makes any of specified findings. (2) Existing law establishes the California Renewables Portfolio Standard Program, which requires the PUC to establish a renewables portfolio standard requiring all retail sellers, as defined, to procure a minimum quantity of electricity products from eligible renewable energy resources, as defined, at specified percentages of the total kilowatthours sold to their retail end-customers during specified compliance periods. Existing law defines "California balancing authority" and "balancing authority area" for purposes of the program. This bill would provide that the above-described independent regional organization is not a California balancing authority and its geographic footprint is not a balancing authority area for purposes of the program. The program, consistent with the goals of procuring the least-cost and best-fit eligible renewable energy resources that meet project viability principles, requires that all retail sellers procure a balanced portfolio of electricity products from eligible renewable energy resources, as specified, referred to as the portfolio content requirements. This bill would require, in making determinations regarding the eligibility of products to satisfy the portfolio content requirements, the Energy Commission to require, at a minimum, resources that do not have a first point of interconnection to a California balancing authority to demonstrate either that the resource operates under a pseudo-tie agreement or dynamic scheduling agreement with the Independent System Operator of another California balancing authority, or that the resource has secured, and exercised its rights to, firm transmission necessary to deliver its output to a California balancing authority without substituting electricity from another source. (3) Existing law requires the Power Exchange to provide an efficient competitive auction, open on a nondiscriminatory basis to all suppliers, that meets the loads of all exchange customers at efficient prices, and authorizes the Power Exchange governing board to form appropriate technical advisory committees composed of market and nonmarket participants to advise the governing board on relevant issues. This bill would delete these provisions. (4) Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime. Because certain provisions of this bill would be part of the act and a violation of a PUC action implementing the bill's requirements would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.

Bill Text

Action History

  1. Joint Rule 61(a)(13) suspended. (Ayes 60. Noes 20. Page 3128.)

  2. July 16 set for first hearing canceled at the request of author.

  3. Re-referred to Coms. on U. & E. and APPR. pursuant to Assembly Rule 51.

  4. In Assembly. Read first time. Held at Desk.

  5. Read third time. Passed. (Ayes 33. Noes 1. Page 1517.) Ordered to the Assembly.

  6. Motion to reconsider made by Senator Becker.

  7. Reconsideration granted. (Ayes 39. Noes 0. Page 1517.)

  8. Read third time. Passed. (Ayes 36. Noes 0. Page 1518.) Ordered to the Assembly.

  9. Read second time. Ordered to third reading.

  10. Ordered to second reading.

  11. Read third time and amended.

  12. Read second time and amended. Ordered to third reading.

  13. From committee: Do pass as amended. (Ayes 4. Noes 1. Page 1203.) (May 23).

  14. Set for hearing May 23.

  15. May 19 hearing: Placed on APPR. suspense file.

  16. Set for hearing May 19.

  17. Read second time and amended. Re-referred to Com. on APPR.

  18. From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 11. Noes 0. Page 941.) (April 29).

  19. From committee: Do pass and re-refer to Com. on JUD. (Ayes 17. Noes 0. Page 810.) (April 21). Re-referred to Com. on JUD.

  20. Set for hearing April 29 in JUD. pending receipt.

  21. Set for hearing April 21.

  22. From committee with author's amendments. Read second time and amended. Re-referred to Com. on E., U & C.

  23. Referred to Coms. on E., U & C. and JUD.

  24. From printer. May be acted upon on or after March 23.

  25. Introduced. Read first time. To Com. on RLS. for assignment. To print.

Sponsors

Sponsorship breakdown

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1 sponsors · 1 co-sponsors · 120 not signed on · 1 voted No

Sponsors (1)

Co-sponsors (1)

Not signed on (120)

120 members have not signed on to this bill.

Show all 120 →

"Not signed on" means a member has not sponsored or co-sponsored this bill — it does not imply opposition. Members flagged Voted No have a recorded No vote on this bill.

Whip count is in markup. Polling the chamber and every recorded vote this session. Only the first open is slow. It’s instant for you after this. Calling the roll · Tallying · Engrossing

Votes

3rd Reading SB540 Becker et al.

Passed 36 Yea · 0 Nay · 4 Other
Party YeaNayPresentNot Voting
Democratic 28002
Republican 8002
Total 36004
% of votes cast 90%0%0%10%
How each member voted (40)
Member Party Vote
Allen, Benjamin Democratic Yea
Archuleta, Bob Democratic Yea
Arreguín, Jesse Democratic Yea
Ashby, Angelique V. Democratic Yea
Becker, Josh Democratic Yea
Blakespear, Catherine S. Democratic Yea
Cabaldon, Christopher Democratic Yea
Caballero, Anna M. Democratic Yea
Cervantes, Sabrina Democratic Yea
Cortese, Dave Democratic Yea
Durazo, Maria Elena Democratic Yea
Gonzalez, Lena A. Democratic Yea
Grayson, Timothy S. Democratic Yea
Hurtado, Melissa Democratic Yea
Laird, John Democratic Yea
Limón, Monique Democratic Yea
McGuire, Mike Democratic Yea
McNerney, Jerry Democratic Yea
Menjivar, Caroline Democratic Yea
Padilla, Stephen C. Democratic Yea
Pérez, Sasha Renée Democratic Yea
Reyes, Eloise Gómez Democratic Not Voting
Richardson, Laura Democratic Yea
Rubio, Susan Democratic Yea
Smallwood-Cuevas, Lola Democratic Yea
Stern, Henry I. Democratic Yea
Umberg, Thomas J. Democratic Yea
Wahab, Aisha Democratic Not Voting
Weber Pierson, M.D., Akilah Democratic Yea
Wiener, Scott D. Democratic Yea
Alvarado-Gil, Marie Republican Yea
Choi, Steven S. Republican Not Voting
Dahle, Megan Republican Yea
Grove, Shannon Republican Yea
Jones, Brian W. Republican Yea
Niello, Roger W. Republican Yea
Ochoa Bogh, Rosilicie Republican Yea
Seyarto, Kelly Republican Not Voting
Strickland, Tony Republican Yea
Valladares, Suzette Martinez Republican Yea

Official roll call →

3rd Reading SB540 Becker et al. Reconsider

Passed 39 Yea · 0 Nay · 1 Other
Party YeaNayPresentNot Voting
Democratic 29001
Republican 10000
Total 39001
% of votes cast 98%0%0%3%
How each member voted (40)
Member Party Vote
Allen, Benjamin Democratic Yea
Archuleta, Bob Democratic Yea
Arreguín, Jesse Democratic Yea
Ashby, Angelique V. Democratic Yea
Becker, Josh Democratic Yea
Blakespear, Catherine S. Democratic Yea
Cabaldon, Christopher Democratic Yea
Caballero, Anna M. Democratic Yea
Cervantes, Sabrina Democratic Yea
Cortese, Dave Democratic Yea
Durazo, Maria Elena Democratic Yea
Gonzalez, Lena A. Democratic Yea
Grayson, Timothy S. Democratic Yea
Hurtado, Melissa Democratic Yea
Laird, John Democratic Yea
Limón, Monique Democratic Yea
McGuire, Mike Democratic Yea
McNerney, Jerry Democratic Yea
Menjivar, Caroline Democratic Yea
Padilla, Stephen C. Democratic Yea
Pérez, Sasha Renée Democratic Yea
Reyes, Eloise Gómez Democratic Not Voting
Richardson, Laura Democratic Yea
Rubio, Susan Democratic Yea
Smallwood-Cuevas, Lola Democratic Yea
Stern, Henry I. Democratic Yea
Umberg, Thomas J. Democratic Yea
Wahab, Aisha Democratic Yea
Weber Pierson, M.D., Akilah Democratic Yea
Wiener, Scott D. Democratic Yea
Alvarado-Gil, Marie Republican Yea
Choi, Steven S. Republican Yea
Dahle, Megan Republican Yea
Grove, Shannon Republican Yea
Jones, Brian W. Republican Yea
Niello, Roger W. Republican Yea
Ochoa Bogh, Rosilicie Republican Yea
Seyarto, Kelly Republican Yea
Strickland, Tony Republican Yea
Valladares, Suzette Martinez Republican Yea

Official roll call →

Do pass as amended, but first amend, and re-refer to the Committee on [Appropriations]

Passed 11 Yea · 0 Nay · 2 Other
Party YeaNayPresentNot Voting
Democratic 9002
Republican 2000
Total 11002
% of votes cast 85%0%0%15%
How each member voted (13)
Member Party Vote
Allen, Benjamin Democratic Not Voting
Arreguín, Jesse Democratic Yea
Ashby, Angelique V. Democratic Yea
Caballero, Anna M. Democratic Yea
Durazo, Maria Elena Democratic Yea
Laird, John Democratic Yea
Stern, Henry I. Democratic Yea
Umberg, Thomas J. Democratic Yea
Wahab, Aisha Democratic Not Voting
Weber Pierson, M.D., Akilah Democratic Yea
Wiener, Scott D. Democratic Yea
Niello, Roger W. Republican Yea
Valladares, Suzette Martinez Republican Yea

Official roll call →

Do pass, but first be re-referred to the Committee on [Judiciary]

Passed 17 Yea · 0 Nay
Party YeaNayPresentNot Voting
Democratic 13000
Republican 4000
Total 17000
% of votes cast 100%0%0%0%
How each member voted (17)
Member Party Vote
Allen, Benjamin Democratic Yea
Archuleta, Bob Democratic Yea
Arreguín, Jesse Democratic Yea
Ashby, Angelique V. Democratic Yea
Becker, Josh Democratic Yea
Caballero, Anna M. Democratic Yea
Gonzalez, Lena A. Democratic Yea
Grayson, Timothy S. Democratic Yea
Limón, Monique Democratic Yea
McNerney, Jerry Democratic Yea
Rubio, Susan Democratic Yea
Stern, Henry I. Democratic Yea
Wahab, Aisha Democratic Yea
Dahle, Megan Republican Yea
Grove, Shannon Republican Yea
Ochoa Bogh, Rosilicie Republican Yea
Strickland, Tony Republican Yea

Official roll call →

Subjects

technology energy
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Frequently asked questions

What does SB 540 do?
(1) Existing law provides for the establishment of an Independent System Operator (ISO) as a nonprofit public benefit corporation and requires the ISO to ensure efficient use and reliable operation of the electrical transmission grid consistent with achieving planning and operating reserve criteria no less stringent than those established by the Western Electricity Coordinating Council and the North American Electric Reliability Council. Existing law, the Clean Energy and Pollution Reduction Act of 2015, provides for the transformation of the ISO into a regional organization, with the approval of the Legislature, pursuant to a specified process. That process provides that modifications to the ISO's governance structure, through changes to its bylaws or other corporate governance documents, will not become effective until the ISO, the Public Utilities Commission (PUC) , the State Energy Resources Conservation and Development Commission (Energy Commission) , the State Air Resources Board (state board) , the Governor, and the Legislature take specified actions on or before January 1, 2019. This bill would delete the above-described provisions providing for the transformation of the ISO into a regional organization. The bill would authorize the ISO and the electrical corporations that are participating transmission owners whose transmission systems are operated by the ISO to use voluntary energy markets governed by an independent regional organization, only if specified requirements are satisfied. The bill would authorize the ISO, on or after January 1, 2028, to implement tariff modifications accepted by the Federal Energy Regulatory Commission to operate the energy markets whose rules are governed by an independent regional organization if the governing board of the ISO adopts a resolution, as specified, finding that each of the specified requirements have been, or will be, adopted by the independent regional organization. The bill would require the ISO to maintain the necessary technical capability to operate energy markets, as specified, and would require the ISO to continue its functions and responsibilities as a balancing authority, as provided. This bill would establish the Regional Energy Market Oversight Council, which would be responsible for ensuring that participation in regional energy markets serves the interests of the state. The bill would require the council to approve or disapprove initial participation in the independent regional organization by electrical corporations and any other participating load-serving entities and determine whether electrical corporations and any other participating load-serving entities should be required to withdraw from an energy market governed by the independent regional organization. The bill would require the council to convene a duly noticed public meeting to make a finding of approval or withdrawal of participation in the independent regional organization and would require the council to disapprove of initial participation in the independent regional organization, or order withdrawal, if the council makes any of specified findings. (2) Existing law establishes the California Renewables Portfolio Standard Program, which requires the PUC to establish a renewables portfolio standard requiring all retail sellers, as defined, to procure a minimum quantity of electricity products from eligible renewable energy resources, as defined, at specified percentages of the total kilowatthours sold to their retail end-customers during specified compliance periods. Existing law defines "California balancing authority" and "balancing authority area" for purposes of the program. This bill would provide that the above-described independent regional organization is not a California balancing authority and its geographic footprint is not a balancing authority area for purposes of the program. The program, consistent with the goals of procuring the least-cost and best-fit eligible renewable energy resources that meet project viability principles, requires that all retail sellers procure a balanced portfolio of electricity products from eligible renewable energy resources, as specified, referred to as the portfolio content requirements. This bill would require, in making determinations regarding the eligibility of products to satisfy the portfolio content requirements, the Energy Commission to require, at a minimum, resources that do not have a first point of interconnection to a California balancing authority to demonstrate either that the resource operates under a pseudo-tie agreement or dynamic scheduling agreement with the Independent System Operator of another California balancing authority, or that the resource has secured, and exercised its rights to, firm transmission necessary to deliver its output to a California balancing authority without substituting electricity from another source. (3) Existing law requires the Power Exchange to provide an efficient competitive auction, open on a nondiscriminatory basis to all suppliers, that meets the loads of all exchange customers at efficient prices, and authorizes the Power Exchange governing board to form appropriate technical advisory committees composed of market and nonmarket participants to advise the governing board on relevant issues. This bill would delete these provisions. (4) Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime. Because certain provisions of this bill would be part of the act and a violation of a PUC action implementing the bill's requirements would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.
Who sponsors SB 540?
SB 540 is sponsored by Stern, Henry I. (Democratic) and Becker, Josh (Democratic).
What is the current status of SB 540?
This bill has passed the Senate. Introduced February 20, 2025. It now moves to the second chamber.
Where can I track SB 540?
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