Governor Arnold Schwarzenegger on August 31 inserted his new energy agency reorganization plan into the text of a bill that has already passed the Assembly. However, it appears unlikely it will be taken up this session. On behalf of Schwarzenegger, Assemblymember Russ Bough (R-Yucaipa) amended his bill, AB 1165, to include the text of the governor's new energy reorganization plan. "We need to streamline the state's energy bureaucracy and implement a comprehensive strategy that will address Californias needs," stated Schwarzenegger. He said that his reorganization will help site "more generation and more transmission," which last week's blackouts showed are "badly needed." Bough's bill originally required other state, regional, and local agencies to use CEC-proposed decisions on power plants as a basis for their own actions under the California Environmental Quality Act. Now gutted and amended, the bill could be heard in committees in the next week if there is a rule waiver. Otherwise, it will likely have to wait until next year, according to Bough's office. "It's too late to consider the bill this year because it has (obviously) missed all the deadlines," stated another Capitol source. "We will consider the bill next year during our usual course of business." The governor's new plan makes several key changes from his initial proposal. Last week, the state Senate voted against the proposal after the Little Hoover Commission and Attorney General Bill Lockyer found it had constitutional flaws (<i>Circuit<\/i>, Aug. 26, 2005). Like his earlier plan, the latest one still would consolidate several energy agencies to create a new California Department of Energy governed by the California Energy Commission. However, unlike the initial proposal, the secretary of energy no longer would chair the commission. Another change would shift siting authority for only electric transmission facilities, not natural gas pipelines, from the California Public Utilities Commission to the new department. The CPUC would maintain its authority to recommend cost caps for transmission projects, as well as all ratemaking functions. The new department would assume investigatory authority for "wholesale energy markets," including electricity, natural gas, and transportation fuels. Finally, the bill would clarify that all employees of the new department will be subject to the conflict-of-interest requirements of the Warren-Alquist Act, which governs today's CEC. Schwarzenegger's initial proposal was unclear on conflict-of-interest requirements.