Seven million electric cars on the road. Thirty percent of heating systems in homes and businesses powered by electricity. And 80 percent of California’s electricity generated by climate-friendly power sources like solar, wind and water.
That’s what Southern California Edison says will be needed by 2030 to meet the Golden State’s ambitious goals for fighting climate change.
The investor-owned utility, which sells electricity to 15 million people, has included those statewide targets in a new strategy document it’s pitching to policymakers as a road map for reducing the greenhouse gas emissions responsible for global warming. Edison says the changes it’s outlining would cause the average electricity bill to rise by about $22 per month, although homes and businesses would get some of that money back in the form of less money spent on gasoline for driving and natural gas for home heating.
The estimated $22 bill hike also doesn’t take into account the benefits of limiting climate change and local air pollution. A recent study led by University of California, Berkeley researchers found that every 1-degree Fahrenheit increase in global temperatures will cost the U.S. about 0.7 percent of its gross domestic product, with low-income areas suffering the most.
Caroline Choi, Edison’s senior vice president for regulatory affairs, said there’s a simple logic to the utility’s plan: “Clean the grid. Electrify everything.”
“We see clean electricity as really essential to helping the state achieve those dual goals” of less climate pollution and less local air pollution, Choi said.
Edison’s plan envisions electric utilities playing a key role in California’s future, at a time when utilities face growing threats from rooftop solar panels, home batteries and efforts by green-minded cities and counties to buy their own electricity. Investor-owned utilities don’t make money by selling electricity, but they do profit off their investments in infrastructure. Edison and California’s other big investor-owned utilities, Pacific Gas & Electric and San Diego Gas & Electric, could see a windfall from building the power lines and other infrastructure needed to accommodate the growing electricity demand from clean cars and electrified space and water heating systems in homes and businesses.
The plan would be good for Edison’s bottom line, but it would also benefit California as a whole, Choi said. California needs a lot more clean electricity to slash its climate pollution 40 percent below 1990 levels by 2030, as mandated by state law.
“It’s our responsibility to help the customer, the community and the state as it moves toward this clean energy economy,” Choi said. “We wanted to put something out there that shows that we get it, we’re on board with where the state is headed, we see real opportunity for the business.”
Edison is behind PG&E and SDG&E when it comes to cleaning up its power supply, but is still on track to meet its state-mandated target of 50 percent renewable energy by 2030. The California Public Utilities Commission said this week that as of the end of last year, Edison is at 28.2 percent, PG&E is at 32.9 percent and SDG&E is at 43.2 percent renewable energy.
The SoCal utility’s newly released plan calls for California to put 7 million electric cars on the road by 2030 — a big jump from the 300,000 zero-emission vehicles, mostly electric, that had been sold in the state through May of this year. Meeting Edison’s target would mean electric vehicles make up nearly a quarter of the state’s passenger cars by 2030.
Clean cars, community choice and rooftop solar
Some clean energy advocates are skeptical of Edison’s road map.
Eric Borden is an energy policy analyst at the Utility Reform Network, a ratepayer watchdog group based in San Francisco. He criticized a recent proposal from Edison, PG&E and SDG&E, currently pending before state regulators, to spend more than $1 billion electrifying the transportation sector, in large part by building charging stations and other infrastructure to serve plug-in trucks, buses and other medium- and heavy-duty vehicles. Borden said he agrees with the utilities’ end goals — getting more electric vehicles on the road — but he thinks there are better ways to accelerate the transition than forcing utility ratepayers to pay big up-front costs for infrastructure projects.
Most of Edison’s newly unveiled road map is “fairly unobjectionable, in terms of the fact that we need to quickly decarbonize the electricity and transportation sectors, and that electric vehicles will be a major part of that,” Borden said. But rather than the kinds of infrastructure solutions Edison is proposing, he’d prefer to see more reliable state funding for electric vehicle rebates, more EV chargers at apartment buildings, and electricity rates designed to reward people for charging their cars when energy is cheap.
“If we’re smart about how we go about getting people to charge and how to make incentives align with low-cost periods, then those costs can be manageable and low,” Borden said. “But what the utilities will continue to propose in these proceedings is additional expenditures on charging infrastructure that would not normally be incurred.”
Edison’s road map says nothing about community choice programs, an increasingly popular option for cities and counties that want to ditch their investor-owned utilities and make their own decisions about where to buy electricity. There are nine such programs, known as CCAs, now operating in California, and local governments in Los Angeles, Riverside and San Diego counties are considering starting community choice initiatives.
Another gap in Edison’s strategy document: technologies like rooftop solar panels and batteries that allow customers to generate and store their own electricity, which are only mentioned in passing. Investor-owned utilities have fought with rooftop solar advocates in recent years over how much money they should be required to pay solar-powered homes for the energy they generate. The utilities largely lost the most recent battle last year, but the California Public Utilities Commission is set to revisit the issue in 2019.
Lauren Navarro, a Sacramento-based clean energy policy manager at the nonprofit Environmental Defense Fund, said she’d like to see more emphasis from Edison on climate initiatives that reduce costs for customers, like time-varying electric rates that incentivize people to use energy when clean power is cheap and abundant, and demand response programs that pay homes and businesses to shift energy use away from peak periods. Navarro also wants utilities to invest more in community solar farms, which allow lower-income communities to benefit more directly from cheap, clean power.
Those types of customer-focused programs don’t require utilities to spend a lot of money on infrastructure, which means they won’t make a lot of money for utility shareholders.
“We want to make sure that California is doing what it needs to do to make sure they are following the most cost-effective solutions, and the ones that will keep prices the lowest for California customers,” Navarro said.
But on the whole, Navarro called Edison’s road map a “very ambitious report.” She especially praised the call for 80 percent carbon-free electricity by 2030, which would exceed California’s existing mandate of 50 percent renewable energy by that year.
“Southern California Edison is actually setting a high standard for the other utilities and for California to follow,” Navarro said.
Solar, wind, batteries and beyond
California’s 50 percent clean energy target only counts renewable resources like solar, wind and geothermal. Edison’s 80 percent target would include also include hydropower and nuclear energy, although the state’s only nuclear power plant is set to close in 2025.
A bill in the state Legislature this year, written by Senate leader Kevin de León, a Los Angeles Democrat, would have taken a slightly different approach to cleaning up the electricity sector. The bill, which died amid opposition from unions and utilities, would have raised the state’s renewable energy mandate to 60 percent by 2030 and tasked state regulators with charting a path to 100 percent carbon-free electricity by 2045.
Edison opposed that bill, in part because it took too narrow an approach to reducing climate pollution, Choi said. She said Edison prefers a more comprehensive strategy that includes not just electricity but also transportation, which now accounts for nearly 40 percent of California’s carbon emissions, more than twice as much as electricity.
“We think it’s really important to look economy wide,” Choi said.
It’s probably just a matter of time before California adopts a higher clean energy target. Gov. Jerry Brown is in Bonn, Germany at a United Nations-organized climate summit this week, where he’s working to convince world leaders that U.S. states and cities will keep fighting climate change even as the federal government rolls back rules that limit carbon pollution. The leading candidates to replace Brown in 2019 are committed to climate action, and Democrats have a lock on both houses in the state Legislature.
California’s recent clean energy boom has been fueled by solar farms and wind turbines, which generate electricity but only at certain times of day. Right now, Golden State utilities complement those energy sources mostly by burning natural gas, a fossil fuel.
In its statewide road map, Edison says 10,000 megawatts of battery storage will be needed to complement intermittent solar and wind, storing the electricity they generate and releasing it back onto the grid when the sun isn’t shining or the wind isn’t blowing. For context, the entire country installed just 221 megawatts of energy storage last year, according to the consulting firm GTM Research and the Energy Storage Association, a trade group. Edison led the way, installing nearly a third of that storage capacity.
Another option for complementing intermittent solar and wind is building geothermal plants, which have high up-front costs but generate climate-friendly electricity around the clock. Some environmental justice advocates have called for Edison and other utilities to invest in new geothermal plants at the southern end of California’s Salton Sea, creating jobs in the Imperial Valley, where incomes are low and unemployment is high.
“As we go to these higher percentages of renewables, we have to think beyond just price as a deciding factor,” Choi said, when asked about geothermal.