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California Will Continue to Reap the Blackouts It Sows

On grid reliability, California creates its own problems and doesn't seem keen on stopping

By guest author Paige Lambermont
September 1, 2020

The California blackouts have been a long time coming.

Years of poor policy and decision making in California have culminated in a grid that is overly reliant on intermittent wind and solar and electricity imports from nearby states. California energy policy continually forces reliable “baseload” energy generation offline in favor of wind and solar, or even worse, with no replacement at all.

It doesn’t take an engineer to see the worrying trend towards electrical deficit brewing over the horizon as blackouts already hamper the state.

One major cause of the rise in usage of wind and solar power in California is the state’s Renewable Portfolio Standard (RPS) which requires that by 2030 all “electric load-serving entities” procure 60 percent of their electricity from renewables, and that by 2045 that share becomes 100 percent. Because of this requirement, utilities use far more of these intermittent resources, resources that although “greener” are less reliable, than they otherwise would. To compensate, California cycles their baseload resources up and down as the sun ceases to shine or the wind ceases to blow, making blackouts more likely.

The shutting down of the San Onofre Nuclear Generating Station (SONGS) in 2012 had major repercussions for consumer price, as well as for reliability. The shuttering of Diablo Canyon in 2024 will likely have similar results. At a time when it would be advantageous to bring new reliable baseload capacity online, California will be doing just the opposite. The state desperately needs more reliable baseload energy, but continues to pass laws like its RPS which force utilities to invest in unreliable technologies in order to remain in compliance.

The closing of SONGS is the best available comparison for what will likely happen following the closing of Diablo Canyon, and is therefore a valuable case study. In January of 2012, SONGS shut down both of its units to replace steam generator tubing that had been replaced between 2009 and 2011, and had degraded far more quickly than expected.  In 2013, Southern California Edison made the decision to permanently retire Units 2 & 3 at the San Onofre Nuclear Generating Station (SONGS). This came following regulatory delays in bringing its units back online following a shut down to replace steam generator tubing despite three independent reviews attesting that the steam generators would be safe at 70% capacity.

When SONGS shut down, California saw its northern and southern wholesale electricity prices which have historically tracked closely with one another diverge. The southern half of the state (where SONGS is located) saw prices 12% higher than the northern half of the state, a difference which can largely be attributed to the loss of SONGS’ comparably cheap power. California’s electricity imports from other states were 90 percent higher in the first half of 2012 than in the first half of 2011. The loss of SONGS was made up largely through increased usage of natural gas for electricity (mostly brought in from other states via pipeline), or through electricity imported from other states. But, as California’s RPS standard deadline draws nearer, and its rules on what source imported electricity can come from become more strict, it is unclear what options grid operators will have to replace Diablo Canyon when that time comes.

According to the U.S. Energy Information Administration (EIA), “Nuclear power’s share of state generation declined from almost one-fifth in 2011 to less than one-tenth in 2018, in large part because of the retirement of the San Onofre nuclear power plant in mid-2013, which left the state with only one operating commercial nuclear power plant—the two-reactor Diablo Canyon facility.” The closing of San Onofre took 2150 Megawatts of clean, reliable energy off of the grid.

In 2016 Pacific Gas & Electric (PG&E) announced its decision not to pursue a twenty year license renewal from the Nuclear Regulatory Commission (NRC) for its two-unit Diablo Canyon Power Plant. The license for Unit 1 expires in 2024 with that of Unit 2 expiring in 2025. The decision not to seek a subsequent license renewal came as part of an agreement with labor and environmental groups in the state. PG&E President Tony Earley pointed to the need to transition California’s grid to renewables and storage and make gains on efficiency as reasoning for the decision and went on to say that, “As we make this transition, Diablo Canyon’s full output will no longer be required.” Four years later, amid blackouts to keep the grid stable, that statement is looking a bit out of touch with reality. The reality is that Diablo Canyon produces nearly 9.38% of the state’s overall electricity, and unless major strides occur in storage technology, the only choices the state will have for reliable large-scale baseload capacity will be nuclear, natural gas, or some combination of the two.

But what about importing energy from other states?

California imported nearly one-third of its electricity from other states in 2018. This is all fine and good when neighboring states have power to spare, but when they don’t their own capacity needs are fulfilled first. The heatwave that contributed to the blackouts wasn’t isolated to California, and states it generally buys power from were experiencing the same rise in temperatures and corresponding air conditioning usage.

A reliable energy plan cannot rely on nearby states for this much of its power, and despite government plans to reduce consumption, Californians’ energy needs cannot be curtailed with the flourishing of a pen. It takes years of changes in consumer preferences and behavior to achieve major usage reductions.

If actions are not immediately taken to both keep current reliable baseload capacity, and remove legal limitations on the construction of new ones, both nuclear and natural gas, then California’s current power predicament may become a regular occurrence.

Without a major tidal shift in California energy policy, this problem is not currently destined to right itself.

This piece was produced by Paige Lambermont, a Policy Associate at IER