California's fragile power grid to continue facing challenges from extended heat

An extreme heat wave the first week of September left many of California's 39 million residents worrying they might lose power as the state's grid operator struggled to avoid rolling blackouts. Peak demand for electricity Sept. 6, at 52,061 MW, topped the California ISO's previous record of 50,270 MW, set in 2006.

Efforts by homes and businesses to conserve power and 8,000 MW of electricity imports from other states saved California from forced shutdowns, CAISO President and CEO Elliot Mainzer told reporters. So did contributions by energy storage that at one point sent nearly 3,400 MW of generation into the system at the right time.

Triggering the crisis was a record-setting heat wave that gripped the state starting Labor Day weekend. Scientists say such extreme heat events are expected to occur more often as global temperatures continue to rise while adding unprecedented challenges to the state's expanding power grid.

California's clean energy mandates are making those challenges even more daunting. By 2030, the California Energy Commission has projected statewide peak electricity demand could exceed 63,600 MW as the state moves from gasoline-fueled to electric-powered vehicles and shifts away from natural gas and other fossil fuels for power generation.

'Outside planning standards'

Triple-digit temperatures and air conditioners running at full blast can upend a grid operator's forecasts in an already-tight electricity market. With the threat of rolling blackouts looming, the state has rushed to shore up power resources while making exceptions to its ambitious decarbonization plans.

"These are record-setting demands on the California grid and well outside the planning standards," Mainzer told reporters at a Sept. 7 press briefing. "We've been very clear about our concerns about resource adequacy in California and making sure that that it's clearly understood that the state and the utilities need to continue bringing new capacity online for reliability."

Since 2020, when an August heat wave forced CAISO to implement the first statewide rolling outages in 19 years, California officials have analyzed the state's grid shortcomings while pouring billions into backup generation and measures to avoid future shutoffs.

Over the past two years, 8,000 MW of new renewable capacity have come online, Mainzer said. And as of late August, developers had added about 4,000 MW of energy storage capacity in the state, S&P Global Market Intelligence data shows.

The buildout of renewables and battery storage are key components in the state's plan to decarbonize its grid by 2045. In 2021, 33.6% of California's power was generated by renewable resources, according to the energy commission.

But the new investments could not meet the early September surge in power consumption. In the end, demand response programs and customer engagement earned much of the credit for California avoiding blackouts. Each day during the grid emergency, electricity usage rose sharply early afternoon, falling during the state's Flex Alert periods when calls for conservation were made.

Homes and businesses in the state will be called on again to help conserve energy.

Drought makes it even hotter

The megadrought that has been gripping the state and most of the Western U.S. is now the driest period in 1,200 years, scientists wrote in the journal Nature Climate Change this year. An especially dry period began in 2020 and is showing no signs of easing up.

Meanwhile, summer days are getting hotter. California's summer temperatures have risen about 3 degrees F on average since 1896, according to researchers at the University of California San Diego. The two trends work in tandem.

When the soil dries out it drives up surface temperatures more, a phenomenon known as a feedback loop. That, in turn, speeds up the rise in global temperatures that began with industrialization, making the climate even drier. The feedback loop also contributes to hotter summer months in California and other dry regions of the world.

Even so, drought and warmer temperatures do not mean every summer will automatically be hotter than the last one, said William Gallus, a professor of geological and atmospheric sciences at Iowa State University. Like other scientists, he takes a long view of planetary change.

The high-pressure system that hovered over California and other parts of the West for more than a week earlier in September may not be repeated in 2023, for example.

"With climate you're dealing with very long scales of time," Gallus said in an interview. "Over 10 years, you would generally expect very warm years to become increasingly common. Does that mean we won't have any cool years in the next 10? We probably might still have one or two when the normal variability in the atmosphere kicks in, but it won't be as cold as it would have been."

Unpredictable weather

Sometimes, weather patterns conspire to make days even hotter.

The jet stream's unusually large swing from the south to the north this summer pushed huge volumes of warm tropical air across the West Coast and parked it there, creating "heat domes" with stagnant air that can generate record temperatures.

San Jose, a Silicon Valley city south of San Francisco with a normally temperate climate, clocked in at an unprecedented 109 degrees F on Sept. 6. Santa Rosa, in northern California, hit 115 degrees F and many other cities in the state suffered through extended periods of triple-digit temperatures.

Across the West, more than 61 million people were under active extreme heat advisories, watches or warnings, the National Weather Service reported.

"You have this great big lid on top of us; it cuts off the sea breeze and temperatures start rising," Jan Null, a lecturer of meteorology and climate science at San Jose State University, said in a Sept. 8 interview. "Here in California, we're very dependent on troughs coming through from the ocean and bringing cooler air; that's our natural air conditioning. But in this case, it really has turned it all off for the last four to five days."

A tropical storm finally broke the back of the heat wave. On Sept. 13, the high temperature in San Jose was predicted to be 75 degrees. CAISO's forecast peak for the day was 34,260 MW.

S&P Global Commodity Insights produces content for distribution on S&P Capital IQ Pro.