United States of America
Before the
Federal Energy Regulatory Commission

California Independent System Operator	)		Docket No. ER98-211-002 
Corporation				)			(Phase I)
						)
California Power Exchange Corporation	)		Docket No. ER98-210-000

PREPARED DIRECT TESTIMONY OF 
BILL BOSWELL

Q.	WHAT IS YOUR NAME AND BUSINESS ADDRESS?

A.	My name is Bill Boswell.  My business address is 1000 Fremont, Building A-13, Alhambra, CA  91803.
Q.	WHAT IS YOUR CURRENT EMPLOYMENT?
A.	Currently, I am the Lead Telecommunication Engineer for the California Independent System Operator Corporation (ISO).   I began my employment with the California Independent System Operator on December 8, 1997.  I became involved with ISO and California Power Exchange Corporation (PX) matters beginning in May 1995, when the California restructuring process began.
Q.	DESCRIBE YOUR WORK EXPERIENCE PRIOR TO YOUR EMPLOYMENT WITH THE ISO.
 
A.	Until December 8, 1997, I was employed by Southern California Edison Company as Power Systems Controls Engineering Supervisor.  From May 1995 to December 8, 1997, I was “on loan” to the California restructuring process as a technical expert in power systems.  I have over 25 years of experience in the telecommunication industry with the last 15 years at Southern California Edison focusing on power system utilization of fiber-based telecommunications.   I have a Bachelor of Science degree from the University of South Carolina.
Q.	WHAT IS THE PURPOSE OF YOUR TESTIMONY?
A.	The purpose of my testimony is to provide an overview of the development and implementation process for the ISO and PX communications infrastructure systems and services.  The process resulted in the ISO and PX contracting with MCI Communications Inc. for the start-up and development of the communications infrastructure and also for ongoing communications services.    
Q.	DESCRIBE THE EARLY DEVELOPMENT PROCESS FOR THE ISO AND PX.
  
A.	In May 1995, the CPUC issued a policy decision that started the groundwork for a Western Power Exchange Market structure.  The three major investor-owned utilities (IOUs), Pacific Gas & Electric Company (PG&E), Southern California Edison Company (SCE) and San Diego Gas & Electric Company (SDG&E) were charged with implementing the CPUC proposals and organizing and hosting the process.  The IOUs were required to provide expert personnel on a temporary basis to assist in the process. 
	In June 1995, the three IOUs recommended that there be a multi-party group consisting of stakeholders to oversee and approve the development process.  The IOUs organized initial working groups to establish the governance and structure of the stakeholder groups.  Through this process the WEPEX Steering Committee was established.  The Steering Committee included members from the IOUs, government agencies, energy customers, independent power producers, Los Angeles Department of Water & Power, and other municipal utilities. 
	In July 1995, the WEPEX Steering Committee developed several task teams to carryout various development functions.  Those task teams were assigned the following functions: 
•	Communications and Stakeholder Relations
•	Governance and Structure
•	Transmission Protocols and Services
•	Bidding, Settlements, and Billing
•	Regulatory Coordination and Filings
•	Dispatch Implementation and Systems Infrastructure

It was the Dispatch Implementation and Systems Infrastructure (DISI) team that was charged with developing all of the ISO and PX technical infrastructures, including the PMS/EMS systems, communications infrastructure, computing services, and the Scheduling Applications (SA) and Scheduling Infrastructures (SI) systems.  
Q.	HOW DID THE DISI TEAM DEVELOP THE WEPEX COMMUNICATION INFRASTRUCTURE?

A.	In July 1995, as an employee of SCE at the time, I presented an initial conceptual design for the WEPEX communication system to DISI team to address the objectives called for in the CPUC policy decision.  The initial design concept provided the outline for a communication infrastructure that performed two functions: 1) control of the transmission grid; and 2) provision of market services.  The DISI team distributed the initial design to the stakeholders for comments.  By September 1995, the initial design was adopted by the Steering Committee.
	In October 1995, DISI and the Steering Committee hired International Network Systems (INS) to take the initial communications design concept to the next step and develop a more detailed conceptual design for the communications infrastructure.  In January 1996, INS distributed a detailed design proposal to the DISI team and the Steering Committee.  The proposed INS detailed design assumed the communications infrastructure would support the functions of two separate entities (i.e., the ISO and PX).  The INS proposal evaluated the existing communications networks of the IOUs and the publicly available communications infrastructure.  INS concluded that the IOU networks were not sufficient to serve the proposals requirements but that the publicly available communications infrastructure was sufficient.  The Steering Committee and the DISI team approved INS’ detailed design proposal. 
Q.	ONCE THE CONCEPTUAL DESIGN OF THE COMMUNICATIONS SYSTEM WAS ESTABLISHED, HOW WAS THE DESIGN IMPLEMENTED?

A.	On January 25, 1996, the DISI team presented to the WEPEX Steering Committee   a detailed report of the communications infrastructure needs that would support the creation of separate ISO and PX entities.  This report contained the assumed key requirements of all market participants.  The WEPEX Steering Committee authorized DISI to solicit bids for consulting support to develop the specific communications infrastructure functional specifications.  By the end of January 1996, a Communication Infrastructure (CI) Development Sub-team was established with the following members: 
Bill Boswell,              (SCE)  		Team Leader
	G. M. Cunningham,   (PG&E)	Technical Member	
	Russ Collins,              (SDG&E)	Technical Member
	David Vaughn,           (SDG&E)	Technical Member
	Dante Demasco,         (SCE)		Cost and Schedule

By February 15, 1996, the DISI Team completed a report defining the primary tasks for the CI Sub-team.  The CI Sub-team was charged with developing and soliciting bids for any required consulting assistance necessary to develop functional specifications, identifying potential bidders, and carrying out the procurement process.  
Q.	DESCRIBE HOW THE CI SUB-TEAM SOLICITED BIDS FOR CONSULTING SUPPORT.

A.	The CI Sub-team sent Requests for Proposals (RFPs) to 4 potential consultants. 
			BBN Corporation
			Deloitte & Touche Consulting Group
			Loral Federal Systems
			Booz, Allen & Hamilton

Two of the potential consultants, BBN Corporation and Deloitte & Touche Consulting Group (Deloitte & Touche) sent proposals to assist in the development of WEPEX Communications Infrastructure Functional Specifications.  On March 10, 1996, the WEPEX Steering Team approved the bid from Deloitte & Touche as the most qualified to provide the requested services.  On March 20, 1996, Deloitte & Touche analyzed and accepted the INS conceptual design and submitted to the WEPEX Steering Committee a methodology for estimating the cost to provide an “Intranet” and WENET Communications Infrastructures.  “Intranet” refers to the WEPEX network, which is a private communications network serving all market participants.  The Intranet provides for operation and control of the transmission grid, revenue metering and the WENET.  The WENET is a public access portion of the Intranet containing information for buying and selling energy.  The CI Sub-team, with assistance from Deloitte & Touche, concluded that the current IOU infrastructure was not sufficient and that there was insufficient time to build one.  Deloitte & Touche therefore recommended that the facilities be acquired from a public carrier.  Deloitte & Touche’s recommendation was approved by the DISI Team and the Steering Committee.    
Q.	WHAT WAS DELOITTE & TOUCHE’S FUNCTION IN DEVELOPING THE ISO AND PX COMMUNICATIONS INFRASTRUCTURE?

A.	Deloitte & Touche assisted in the preparation of the prospective bidder list, the Request for Information (RFI) and the methodology for prequalification of bidders. 
On April 12, 1996, WEPEX issued a Request for Information (RFI) to 28 prospective bidders for development of state-wide data and voice network services in California to support the communications needs of the future deregulated market.  Deloitte & Touche and the CI Development Team developed the following criteria to select the bidders to receive the RFI:
•	Bidders must have demonstrated systems integration capabilities
•	Bidders must have the ability to provide the end-to end network and network services required to meet the data and voice needs
•	Bidders must have the ability to meet the aggressive implementation schedules
•	Bidders must be able to demonstrate significant scale, financial strength, presence and experience
•	Bidders must have, or must be able to acquire, communications infrastructure in California

The bidders list was restricted to third parties not previously associated with the implementation of the CPUC order relating to the development of the ISO and PX.  Thus, the IOUs were not included in the bidder list.  Responses to the RFI were received from seven prospective bidders:
	1.  AT&T Corp.
	2.  DEC (unsolicited response)
	3.  Intel/Com Group, Inc. 
	4.  ISSC (IBM + Pacbell)
	5.  MCI
	6.  Metropolitan Fiber Systems
7.  Sprint

Q.	WHAT SPECIFICATIONS WERE INCLUDED IN THE RFI?

A.	The RFI listed three components of the systems to be developed:
1.	Data Communications – includes local and backbone/long-haul networks and premise equipment at the PX and ISO
2.	Voice Communications Network- includes all local and long distance voice services, both inbound and outbound, including virtual network services, telephone calling cards and related services
3.	Voice Premise Equipment – includes all PBXs, key systems, automatic call distribution systems, voice mail, voice response units, and related equipment.
It is my understanding that a copy of the RFI and RFP, which are quite voluminous, will be available for inspection at the designated document depositories in this proceeding.    
Q.	HOW MANY OF THE RFI RESPONSES QUALIFIED TO RECEIVE RFPS?

A.	In July 1996, using the established bid criteria Deloitte & Touche and the CI Development Team selected four of the seven bidders to receive an RFP (Request for Proposal).  The four companies selected were: AT&T, ISSC (IBM + PacBell Alliance), MCI, and Sprint.
Q.	DESCRIBE THE RFP THAT WAS SENT TO THE FOUR BIDDERS?
A	Between July and August 1996, the CI Development Team and Deloitte & Touche drafted the RFP with comments from the WEPEX teams.  The RFP was then presented and approved by the WEPEX Steering Committee.  The RFP contained the capacity specifications for the ISO and PX that were approved by the Steering Committee.  The RFP was sent to the four bidders at the end of August 1996. 
Q.	HOW WAS THE WINNING BIDDER TO BE SELECTED?
A.	Shortly after the RFP for communications services was issued, the WEPEX Steering Committee issued a separate RFP for technical and financial consulting support to evaluate the returning bids.  The bidder’s list for bid evaluation consulting services included:
		Deloitte & Touche Consulting Group
		BBN Planet Internetworking Consulting Group
		Booz-Allen & Hamilton Inc.
		Kingston Cole & Associates

On September 5, 1996, Deloitte & Touche was awarded the consulting contract to assist in evaluating the bids for the communications infrastructure developer.  During September 1996, separate meetings were held with each of the four bidders. 
Q.	WHAT IS THE ISO/PX COMMUNICATION INFRASTRUCTURE (CI) BID EVALUATION TEAM?

A.	The ISO/PX CI EVALUATION TEAM was established at the WEPEX Steering Committee Meeting on October 7, 1996.  The ISO/PX CI Bid Evaluation Team consisted of the following entities:
•	CPUC Division of Rate Payers Advocates
•	California Energy Commission 
•	California Department of General Services / Telecom
•	California Department of Water Resources
•	Western Area Power Administration
•	Barkovich & Yap (representing energy customers)
•	Los Angeles Department of Water & Power
•	Other Municipal Utilities  (represented by the WEPEX Steering Committee 
•	Southern California Edison Company
•	Pacific Gas & Electric Company
•	San Diego Gas & Electric Company

The purpose of the CI Bid Evaluation Team was to get a broader stakeholder participation in the selection of the vendor for the communications infrastructure.  The CI Bid Evaluation Team was charged with evaluating the RFPs from a technical and financial perspective, analyzing the network prototypes that were presented and assisting in the development of a draft contract.  
	On November 27, 1996, the CI Bid Evaluation Team Selected Two Finalist Vendors,  IBM/PacBell (ISSC) and MCI.  Both vendors were required to build and demonstrate a “live test prototype” of the proposed network, at a substantial cost to each vendor.  The CI Bid Evaluation Team traveled to each vendor’s development lab to analyze the live test prototypes.  In late December 1996, after reviewing each prototype, the CI Bid Evaluation Team recommended MCI to the WEPEX Steering Committee.  Shortly thereafter, the WEPEX Steering Committee voted to establish MCI as a “preferred” vendor and IBM/PacBell as the preferred alternate.
Q.	WHEN WERE THE ISO AND PX RESTRUCTURING TRUSTS ESTABLISHED?

A.	The ISO and PX Restructuring Trusts were established on or about October 20, 1996 by the WEPEX Steering Committee.  Mr. David Freeman assumed the role as Trust Administrator of both trusts.  When the trusts were established, the WEPEX Steering Committee was dissolved.  In its place, the Trustee Advisory Committee (TAC) was established.  The TAC was comprised of the same members as the WEPEX Steering Committee and was open for membership to all stakeholder groups.      
Q.	DESCRIBE THE NEGOTIATION PROCESS WITH MCI TO DRAFT THE COMMUNICATIONS INFRASTRUCTURE CONTRACT.

A.	With the approval of the WEPEX Steering Committee, Duke Engineering and Services, Inc. and other attorneys and consultants, including myself, began contract negotiations with both MCI and IBM/PacBell.  The contracts for the PX and the ISO were finalized during January 1997 and presented to the trustee of the PX and ISO Trusts for approval on February 1, 1997.  The final cost of the MCI contracts was less than the original bid cost that MCI submitted.  The TAC reviewed the contracts and recommended that the Trustee sign it.  The contracts were dated February 13, 1997 and were signed by the Trustee on February 21, 1997.       
Q.	WHAT HAPPENED AFTER THE TRUSTEE SIGNED THE CONTRACT?
A.	MCI built the statewide communications network from February 1997 to September 1997.  The statewide communications network consists of 11 access facilities, 4 backbone facilities, and ISO and PX primary and backup facilities.  The work was completed in late 1997.  
Q.	DOES THIS CONCLUDE YOUR TESTIMONY?
A.	Yes.