California Grid Girds for Summer

Orange County Register:

State agencies and electric utilities are scrambling to shore up power supplies in hopes of avoiding the rolling blackouts that left 800,000 California homes and businesses without power during a record-breaking heatwave last August.

That means gas-fired power plants could be called on more, instead of less, at a time when the state is trying wean itself from fossil fuels that produce greenhouse gases.

Already last year, state regulators extended the life of outdated gas-fired power generators in Huntington Beach, Long Beach, Redondo Beach and Oxnard, all of which had been scheduled to shut down at the end of 2020. And now, the state is considering a second extension for the Redondo Beach plant, which is currently scheduled to close at the end of this year.

Environmentalists are at odds with regulators and utilities over how to address the shifting energy landscape. But both sides agree that more needs to be done to meet clean energy goals at a time of when the Diablo Canyon nuclear plant and several gas-fired plants are scheduled to close, climate change is increasing summer electricity demands, and the phasing out of gasoline cars and natural-gas buildings will boost year-round electricity needs.

Legislators are also becoming increasingly aware of the steep challenge ahead if California is to meet its targets of 60% green energy by 2030 and 100% by 2045.

“To meet our state’s goals, we must build six gigawatts of new renewable and storage each year … equivalent to powering approximately 4 million homes with clean energy every year,” Sen. Dianne Feinstein said in a March 19 letter to California Public Utilities Commission President Marybel Batjer. Feinstein called on the commission to let her know of its priorities for possible inclusion in any future federal infrastructure package, such as the proposal now being prepared by the White House.

But the more urgent concern is getting the state through the next couple summers.
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The state’s “Final Root Cause Analysis” found the rolling blackouts on Aug. 14 and 15 resulted from a combination of increased demand, inadequate supplies, a now-fixed software glitch, the export of power to out-of-state utilities, gas-fired plants unable to run at full capacity and out-of-state suppliers with no energy left to sell to California.

It was a problem anticipated, in part, in a state readiness report for the summer of 2020 that was written by the non-profit, quasi-governmental agency known as CAISO, which coordinates 80% of power delivery in the state. The report noted that if a heatwave extended beyond California to neighboring states that sell energy to the Golden State, there would be risk of an electricity shortage.

In an effort to shore up supplies for this summer, the state Public Utilities Commission on Thursday, March 25, will consider a proposal that, among other things, calls for a 2.5% increase in the amount of energy procured by the state’s three major utilities, Southern California Edison, San Diego Gas & Electric, and Pacific Gas and Electric.

The plan also seeks to reduce demand at critical junctures by adjusting and increasing the possible number of “critical peak pricing” periods when utilities charge the most for electricity, and by allowing large commercial customers to pay a lower rate if they allow the utility to reduce the amount of power available when there’s a threat of blackouts.

But green-power activists oppose the proposal, saying there should be more emphasis on reducing demand and less on increasing supplies from existing sources.

“All of that gas burning is what we need to get away from, but instead we’re leaning into it,” said V. John White, executive director of the non-profit Center for Energy Efficiency and Renewable Technologies. Along with the Sierra Club and other environmental groups, White’s organization wants strict limits on utilities procuring additional energy from gas-fired plants.

Utility Dive:

As California’s last nuclear facility — the 2.2 GW Diablo Canyon power plant — approaches its scheduled retirement date, some energy experts worry that the state hasn’t fully prepared for what comes next.

The Diablo Canyon plant is located on California’s Central Coast and produces some 18,000 GWh of electricity annually — almost 10% of the state’s energy portfolio. Since the closure of the San Onofre Nuclear Generating Station eight years ago, it has been the sole operational nuclear power facility in California. In 2018, regulators allowed Pacific Gas & Electric (PG&E) to close down the plant’s two reactors when their licenses expire in 2024 and 2025. But as those dates draw nearer, experts are questioning what it will mean for California’s reliability and greenhouse gas (GHG) emission goals.

“You have this huge amount of carbon-free resources that will be coming offline three to four years from now — which is in reality like tomorrow, when you’re trying to develop other new resources,” Jan Smutny-Jones, CEO of the Independent Energy Producers Association, said.

“So it’s really significant that it’s going away and the question then is, what do we replace it with?” he added. 

The Diablo Canyon nuclear plant came online in 1985 and has been the target of numerous protests over its lifespan, especially after the discovery of a nearby earthquake fault. But the plant has also played a key role in ensuring the reliability of California’s electric grid.

When PG&E first filed for permission to retire the plant, the utility also outlined a plan to partially replace it with three tranches of carbon-free resources — a combination of 2,000 GWh of energy efficiency, 2,000 GWh of carbon-free energy, and a voluntary 55% renewables commitment. 

The California Public Utilities Commission (CPUC), however, declined to authorize that plan, instead shifting the question of how to replace Diablo Canyon to the agency’s integrated resource planning proceeding. The regulators said in a 2018 decision that they intended to ensure the plant’s closure didn’t lead to an increase of greenhouse gases, but “it is not clear based on the limited record in this proceeding what level of GHG-free procurement (if any) may be needed to offset the retirement of Diablo Canyon.”

More recently — and especially in the wake of the rolling blackouts that occurred in California last August — some stakeholders are taking a closer look at how Diablo Canyon’s retirement will affect electric reliability in the state. Last October, the California Independent System Operator (CAISO) warned in a filing that the system will hit a “critical inflection point” after the nuclear plant retires, with resource needs that are much higher than initially anticipated to ensure reliability. 

“It’s [around] 2,100 MW of power that is baseload — and so that is a particular challenge in terms of reliability, particularly since the state has had a policy of trying to move away from fossil fuels,” Dan Richard, a solo energy consultant and former senior official at PG&E, explained.

CAISO has been modeling for a potential loss of Diablo Canyon since before its retirement was proposed, spokesperson Anne Gonzales said in an emailed statement. In its 2018-2019 transmission plan, the system operator recommended transmission upgrades to address reliability issues from the plant’s closure — two dynamic reactive devices in the central and northern PG&E bulk system, both of which are currently being installed, Gonzales added. 

California has a robust renewable energy portfolio, but that raises questions of effective capacity versus installed capacity, Richard said. Moreover, Diablo Canyon will be retired against the backdrop of the electrification of California’s transportation system, which is likely to increase electricity demand.

Without careful planning, California will be forced to rely on short-term procurements after the nuclear plant is shuttered, scrambling around to add a little power here and there, said Smutny-Jones. Meanwhile, a group of gas-fired plants that were initially supposed to go offline at the end of 2020, before being extended for reliability reasons, might have to stay online until there are adequate resources to replace them.

“There’s a whole cottage industry of people who want to do nothing more than shut down gas plants as quickly as they can… in an effort to get to the 2045 goals as quickly as possible,” Smutny-Jones added. “I think that unless we properly manage this, we run the risk of additional erosion of reliability, and potentially resulting in excessive cost as well.”

Last month, the CPUC issued a ruling to address potential reliability challenges in 2024 through 2026, due to a variety of factors including the retirement of Diablo Canyon and natural gas plants. In total, the agency recommended procuring 7,500 MW of resources from 2023 through 2025, and is contemplating partially meeting that need through 1 GW of geothermal energy and 1 GW of long-duration storage, with a minimum duration of eight hours. 

Long-duration storage and geothermal resources can both help to produce energy more consistently around the clock, agreed Mark Specht, an energy analyst with the Union of Concerned Scientists (UCS) — regulators seem to be looking out over the long term and recognizing that these are resources the system will need sooner or later.

“We may as well build sooner, especially given their very high grid reliability contributions,” he added. 

But bringing those resources online in the next four or five years could be a challenge, Specht said. And Richard is concerned that long-duration storage technologies — with the exception of pumped hydro, which faces its own siting and permitting challenges — are not sufficiently evolved yet. 

Diablo Canyon’s retirement could also jeopardize California’s GHG emission goals. California enacted legislation in 2018 that requires state regulators to prevent the plant’s closure from leading to an increase in emissions. But without enough planning, natural gas power plants could step in to fill the gap, leading to a potential 15.5 million metric tons of additional GHG emissions between now and the end of the decade, according to a report from UCS — roughly equivalent to the impact of 306,000 gasoline passenger vehicles during the same period.

“You saw that back in the 2014 timeframe, when the San Onofre Nuclear Generating Station went offline,” Smutny-Jones said. “We had been reducing CO2 from California-based plants at a pretty steady downward line and then all of a sudden, it started bouncing upwards… it wouldn’t be surprising to see a very similar pattern occur in 2025.”

For nuclear advocates, the solution is clear: stop the plan to shut the Diablo Canyon power plant down, and maybe even build more nuclear plants in California. Retiring the plant is a risky move, given that California is vulnerable to earthquakes and the potential for that capacity to be replaced with natural gas generation, according to Gene Nelson, government liaison at Californians for Green Nuclear Power.

“The idea that we should turn off a reliable, earthquake resistant nuclear power plant to serve narrow commercial interests is not in the public interest,” Nelson said. 

But others are skeptical that Diablo Canyon’s scheduled retirement can be stopped. 

“A lot of parties came together to reach a balanced settlement on the closure of the plant, so I think the momentum is certainly in that direction,” Richard said. But stakeholders are somewhat split on the broader question of how nuclear power can fit into California’s clean energy transition, so “I don’t see any momentum for that right now, but I would not be surprised if that conversation does come to the table,” he added.