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California’s Independent System Operator (CAISO) Shares Their First Ever Twenty-Year Plan

If you follow the energy sector in California, it won’t take long to realize we are heading into an all-electric future. Rapid advances in technology and reduced cost of goods have made utility-scale solar production the lowest cost generation option in the state. Electricity, derived from clean, carbon-free sources, will replace fossil fuel as our primary energy source.

Electrification of transportation is slowly getting traction. Building electrification is the next significant sector. What happens to the electrical distribution grid with all these new electric loads coming onboard? Will it support electrification? Is large-scale storage a part of the solution? Has anyone considered the implications? Rest assured that these topics are being addressed. Many people are working diligently to prepare California for an all-electric future.

CAISO is the party responsible for the electrical distribution grid in California. They just released a report on the steps required to ensure the grid will be reliable and ready to support widescale electrification.

CAISO is working collectively with the California Energy Commission (CEC) and California to define barriers and solutions to adding load to the grid.

Here is a simplified summary of their considerations.

  • In 20 years, we will need three times more electricity than what the grid can provide today
  • Planners are anticipating the need to add 120 gigawatts (GW) of clean power to the grid by 2040
  • Behind the meter solar (rooftop) will provide 30 megawatts of power by 2040
  • Upgrading the grid will require significant funding
    • Increasing transmission capacity will cost $30 billion over the next 20 years
    • New transmission projects will cost an estimated $2.9 billion
  • This year grid capacity will increase by 3,581 megawatts (MW), 2,181 of which will be available to meet peak demand
  • Every day, we add clean energy to the grid to meet increased demand. This year plans are in place to add:
    • 2,100 MW of storage
    • 1,200 MW of solar
    • 200 MW of wind
    • 40 MW of hydro
    • 30 MW of natural gas
    • 11 MW of biofuel

The numbers and effort to transition to a clean energy future are significant but not insurmountable. You need to recognize that California’s annual economy is currently just over $3 trillion to keep things in perspective. The clean energy transition will likely add to our economy, a rapidly growing sector.

Investing in the grid to support clean energy is an investment in our future. It makes sense and likely dollars too. It’s comforting to know the supporters of decarbonization are factoring in the impacts of the electrical distribution grid.

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