California plans to add nearly 60 GW of renewables, storage by 2035

California must add nearly 60 GW of new renewable energy and energy storage resources by 2035 to slash power sector greenhouse gas emissions under a sweeping plan approved Feb. 15 by state energy regulators.

"This is a critical component of California's climate change strategy," California Public Utilities Commission President Alice Reynolds said ahead of a 3-0 decision to approve the "preferred system plan and portfolio," which is designed to reduce emissions in the power sector to 25 million metric tons by 2035.

More than 40 individual integrated resource plans filed by investor-owned utilities, community choice aggregators and other load-serving entities helped to shape the statewide preferred plan. Under the portfolio, the use of natural gas-fired power plants connected to the California ISO transmission system "would decrease by roughly 70% by 2035" compared with 2024, Reynolds said.

Overall, the 2035 plan would cut power sector emissions 58% from 2020 levels, according to the agency.

Regulators recommended CAISO use the preferred portfolio in its 2024-2025 transmission planning process, as well as a second "policy-driven sensitivity" portfolio that includes 15 GW of gas generation retirements by 2039.

"The adoption of this preferred system plan portfolio is critical as it provides necessary information to the California ISO for the planning of new transmission investments through the transmission planning process," said Commissioner Darcie Houck, adding that the PUC for the first time was sending CAISO portfolio projections extending out 15 years rather than 10.

Leaning big on solar, batteries

The preferred portfolio is powered primarily by solar and wind farms, and lithium-ion battery storage. It includes the addition of 19 GW of large-scale solar resources by 2035, more than the 18.5 GW of CAISO-connected solar as of Feb. 1. The preferred plan also calls for 15.7 GW of four-hour batteries and 2.8 GW of eight-hour batteries by 2035. That compared with roughly 7.3 GW of battery power storage capacity on the CAISO system as of Feb. 7, according to the grid operator.

The preferred plan also includes 2 GW of additional geothermal generating capacity by 2035, 7.1 GW of land-based wind from other states, 7 GW of land-based wind in California and 4.5 GW of offshore wind. Included in the 2035 preferred portfolio are 500 MW of pumped hydroelectric storage capacity and 500 MW of other long-duration storage.

The preferred portfolio also offers a glimpse at resource additions through 2045, with load-serving entities seeking to cover 100% of their retail sales with clean energy by that time, as directed by Senate Bill 100. California's new resource additions by that time total over 100 GW under the plan, including 57.5 GW of solar, 19.5 GW of eight-hour lithium-ion batteries and 25.5 GW of wind from land-based and offshore facilities.

No delays for Diablo Canyon replacements

As part of their decision, regulators also denied a request by the state's two largest utilities -- PG&E Corp. subsidiary Pacific Gas and Electric Co. (PG&E) and Edison International affiliate Southern California Edison Co. (SCE) -- to delay by two years a prior PUC decision to replace a portion of the system reliability contribution from PG&E's 2,240-MW Diablo Canyon nuclear power plant by June 2025.

Backed by California Gov. Gavin Newsom, state lawmakers and the US Energy Department, PG&E is now seeking to extend operations at Diablo Canyon beyond current federal operating licenses that expire for the twin-reactor facility in 2024 and 2025.

PG&E and SCE asked for the deadline for Diablo Canyon replacement capacity to be pushed to June 1, 2027, citing delays and high costs associated with new resource contracts to meet the June 1, 2025, deadline, as well as large volumes of replacement capacity already procured by load-serving entities as a whole.

"We encourage all [load-serving entities] to make their best efforts to procure the Diablo Canyon replacement resources," the PUC decision said. " If their actions are not successful, documentation of procurement actions can be submitted as evidence of good faith efforts when compliance and enforcement determinations are made in the future."