California lawmakers have passed a landmark bill that will allow CAISO to transition the governance of its markets to the independent “regional organization” envisioned by the West-Wide Governance Pathways Initiative.

The West-Wide Governance Pathways Initiative will run its stakeholder processes separately from CAISO’s until the effort's regional organization is formally launched in 2028, even in areas of overlapping interest.

The West-Wide Governance Pathways Initiative’s Launch Committee said it hopes to seat a permanent board by either next year or 2027 for the regional organization that will govern energy markets in the West.

The federal government has put on hold nearly $1 million in funding toward the development of a new independent Western RO to oversee CAISO’s WEIM and EDAM, the West-Wide Governance Pathways Initiative’s Launch Committee said.

The Pathways Step 2 proposal offers a blueprint for divvying up functions between CAISO and the RO that backers envision will provide an independent framework for governing the ISO’s Western markets.

A representative of one of the staunchest opponents of past efforts to transform CAISO into an RTO said his labor union plans to sponsor the legislation needed to implement the “Step 2” proposal of the West-Wide Governance Pathways Initiative.

Key backers of the West-Wide Governance Pathways Initiative told state energy officials they’re confident California lawmakers next year will pass a bill needed to relax state oversight on CAISO’s markets and establish the "RO" envisioned by the initiative.