2009 California Public Utilities Code - Section 359 :: Article 5. Regional Compact

359.  (a) It is the intent of the Legislature to provide for the
evolution of the Independent System Operator and the Power Exchange
into regional organizations to promote the development of regional
electricity transmission markets in the western states and to improve
the access of consumers served by the Independent System Operator
and the Power Exchange to those markets.
   (b) The preferred means by which the voluntary evolution described
in subdivision (a) should occur is through the adoption of a
regional compact or other comparable agreement among cooperating
party states, the retail customers of which states would reside
within the geographic territories served by the Independent System
Operator and the Power Exchange.
   (c) The agreement described in subdivision (b) should provide for
all of the following:
   (1) An equitable process for the appointment or confirmation by
party states of members of the governing boards of the Independent
System Operator and the Power Exchange.
   (2) A respecification of the size, structure, representation,
eligible membership, nominating procedures, and member terms of
service of the governing boards of the Independent System Operator
and the Power Exchange.
   (3) Mechanisms by which each party state, jointly or separately,
can oversee effectively the actions of the Independent System
Operator and the Power Exchange as those actions relate to the
assurance of electricity system reliability within the party state
and to matters that affect electricity sales to the retail customers
of the party state or otherwise affect the general welfare of the
electricity consumers and the general public of the party state.
   (4) The adherence by publicly owned and investor-owned utilities
located in party states to enforceable standards and protocols to
protect the reliability of the interconnected regional transmission
and distribution systems.