California faces serious challenges maintaining reliable electric service to more than six million people who live in the area from San Diego to Los Angeles after Southern California Edison decided to close the San Onofre nuclear power plant permanently in the summer 2013. The plant was 2,246 megawatts.
Another 5,068 megawatts of coastal power plants that use seawater for cooling will also have to close over the period 2017
through 2021. The state is trying simultaneously to reduce
greenhouse gas emissions to 1990 levels by 2020. Demand for
electricity in southern California is growing by about 400 megawatts a year.
Robert Weisenmiller, chairman of the California Energy
Commission, the agency charging with planning, talked about
what he sees ahead during an Infocast webinar in January. The
moderator was Keith Martin with Chadbourne in Washington.
MR. MARTIN: What role does the California Energy
Commission play in the power sector in California?
DR. WEISENMILLER: The CEC was established 40 years ago.
One of the many things we do is power plant siting for any
thermal facility in California that is over 50 megawatts. We
also are responsible for determining what qualifies as renewable energy in addition to verifying eligible generation and
reviewing what the municipal utilities are doing for renewable
procurement. We are the premier planning agency for the
state, so we have a long history in demand forecasting. We
also handle energy efficiency, which includes building and
appliance standards. These standards are part of the reason
why California’s energy use is relatively low. We also do
research and development for both gas and electricity, and we
are responsible for helping to develop clean vehicles and alternative fuels. Finally, we do contingency and emergency planning for energy.
I first met Governor Jerry Brown during the Arab oil
embargo in the 1970’s during an earlier tour as head of policy
development at the commission. We were trying to figure out
what the situation was going to be at the gasoline pumps the
MR. MARTIN: Suppose you decide, as part of your contingency planning for the power sector, that more capacity is
needed? How are your recommendations implemented?
DR. WEISENMILLER: Most of the new power would have to
come from utility solicitations. The procurement process is
directed by the California Public Utilities Commission. In the
past, we have sometimes also used executive orders requiring
an expedited signing process. The more conventional approach
is to ask the CPUC to move forward with procurement.
MR. MARTIN: The San Onofre nuclear generating station
— SONGS for short — is midway between Los Angeles and
DR. WEISENMILLER: It was 2,246 megawatts. It used to
produce at a very high capacity factor, at 80% or 90%. That was
a lot of energy relative to the rest of the system, and it also
provided over 1,100 MVARs of reactive power support. It provided energy for 1.4 million homes.
MVAR is a measure of reactive power. It is like the pressure
that pushes water through the water mains. SONGS was
unique in that it helped not just with
generation, but also with the transmission system. You have to
be able to move the power from power plants to people’s
houses. The southern California grid was built around the
assumption that SONGS would remain in operation. We will
need to replace the reactive power.
MR. MARTIN: What percentage of electricity in the LA Basin
and San Diego did SONGS supply?
DR. WEISENMILLER: About 16%.
MR. MARTIN: SONGS had been largely idle for the two years
before the decision to shut it down, and the region managed
to get by without it. Why was the shutdown a big deal?
DR. WEISENMILLER: We were lucky the last two summers.
We may not always be as lucky. The only generating units in
Orange County are SONGS and a gas-fired power plant in
Huntington Beach has also had to be shut down as the pollution offsets that permitted it to remain in operation were
retired. We had to work very hard with the California Air
Resources Board and others to bring the Huntington Beach
plant back up in that first summer to provide some reactive
power in Orange County. Last year, since the pollution offsets
had moved to an emissions project at Walnut Creek, we had to
convert Huntington Beach into a synchronous condenser. That
is like a motor that is providing reactive power, but it is pulling
electricity into the grid as opposed to a turbine that combusts
gas to push electricity to the grid. The synchronous condenser
unit is still operating and is critical for the reactive power.
We also took the opportunity to rewire some of the transmission system. Southern California Edison has done a couple
upgrades to enhance reliability, such as installing static VAR
compensators at some of the major substations in Orange
County, and we have had to resort to “flex alerts,” where we run
messages on TV and radio telling people to conserve electricity.
We have been lucky so far. The first summer without SONGS
was relatively cool, although San Diego Gas & Electric came
within about 50 megawatts of its peak. This year has been even
milder. Northern California has more of a chance of hitting its
peak, but in southern California, it has been more like a 1-in-2
year. When we are looking at contingency planning, we plan for
a 1-in-10 year. We have been lucky not to have had an extended
heat wave or fires near a transmission line. We have been
working steadily in the meantime to enhance our capabilities.
Coastal Power Plants
MR. MARTIN: You have another 5,068 megawatts of power
plants along the California coast that use seawater for oncethrough cooling and that are also expected to have to shut
down. Over what time period will they close?
DR. WEISENMILLER: The next big unit we are looking at
shutting down is a 946-megawatt facility in San Diego in
2017. A lot more will close in 2021. We may be forced to adjust
MR. MARTIN: Will these shutdowns add to the difficulties
in southern California or are most of the plants farther up the
DR. WEISENMILLER: Some of the units are in the south and
will certainly affect things. There is a proposal to repower and
modernize Huntington Beach, which is a key facility for both
power and voltage support. There are some in the LA Basin,
and other potential retirements are all the way up the coast.
The Los Angeles Department of Water and Power is in the
process of repowering some units in the LA Basin. Unless
repowered, all such plants will have to be shut down by 2021
under federal and California regulations.
MR. MARTIN: The figure 5,068 megawatts is somewhat illusory. Don’t the plants operate for the most part at really low
DR. WEISENMILLER: The plants are old. Encino is a good
example; the first units were built in 1959. The most recent
units are from 1973. They tend to be steam boilers. They tend
to have relatively long startup times of anywhere from 17 to
24 hours. That means that if you think you may need the
power, you have to leave the unit running. They are relatively
inefficient when you look at their heat rates, and they are dirty
from an air quality perspective. There is a lot of logic in trying
to repower to use more modern technology. They only really
come in handy if it is midnight and you suddenly lose a transmission line, they can pick up the lost capacity within a half
hour if they are left on and operating.
MR. MARTIN: What percentage of California generation is from
DR. WEISENMILLER: California has a rich resource mix.
Without SONGS, we still have about 10% nuclear power
between Diablo and Palo Verde. We have hydro, assuming that
it is a wet year, of around 10%. We have around 22% renewables, and that is increasing. The remaining 58% is gas. If it is
colder and wetter than expected, then the gas units operate
less and, if it is drier or hotter, or if there is an outage of a
major power plant, then they operate more.
MR. MARTIN: Are cap and trade and the renewable portfolio
standard the principal levers California is using to reduce
greenhouse gas emissions?
DR. WEISENMILLER: Our immediate goal is to return to a
1990 level of greenhouse gas emissions by 2020. The electric
utility sector accounts for about 20% of total greenhouse gas
emissions. We are using energy efficiency, renewables and cap
and trade to reduce emissions.
MR. MARTIN: California has set a goal of 33% renewables by
2020. The state is at about 22% renewables currently. It is
expected to reach 25% by 2016. Will it have any trouble, given
current trends in natural gas prices, reaching 33% within the
next seven years?
DR. WEISENMILLER: Not really.
One issue with renewables procurements is the percentage
of projects that are awarded power contracts but never get
built. The procurements to date put us on a track to hit the
33% target assuming a 40% failure rate.
The actual failure rate is well below 40%. One of the things
my siting people do is look at the status of all projects in terms
of how many have been permitted and what is under construction. Most of the permitted projects are being built.
MR. MARTIN: Do you know the actual failure rate?
DR. WEISENMILLER: It is probably in the 10% to 20% range,
but exact number is hard to pin down, and it varies by technology. What we see is someone signs a power contract and eventually someone with much deeper pockets comes in, takes over
the project company and does what it takes to complete the
project. For example, a number of solar thermal projects have
switched to photovoltaic. The projects and power contracts
change hands. The renewable energy eventually gets delivered.
MR. MARTIN: You made the point at a conference in June that
the state RPS target will be less significant to future renewable
energy development in California than climate change.
DR. WEISENMILLER: Even without SONGS, we are pretty
comfortable that we will reach the 2020 targets for both
renewables and greenhouse gas emissions.
There are some executive orders from Governor Brown and
Governor Schwarzenegger setting 2050 emissions targets, but
our feeling is that 2050 is too far away to do accurate forecasting. It is more productive to focus on 2030, come up with a
plan and make progress. We are counting on three trends to
reduce emissions. One is a shift to electric vehicles. The governor wants to see 1.5 million electric
vehicles in California by 2025.
Transport accounts for 40% of our
greenhouse gas emissions. We can’t
reach our goals by reducing emissions
solely in the power sector.
It is also important to improve
energy efficiency in existing buildings. We have very strict standards
for new buildings, and we have
another round taking effect in July
that will be 25% lower than our previous standards.
MR. MARTIN: Does the 33% target
for renewable energy by 2020 count
output from rooftop solar or does it count output only from
DR. WEISENMILLER: Rooftop is counted potentially both
indirectly and directly. Rooftop solar reduces retail sales, which
in turn lowers the amount of renewable energy credits needed
to meet the renewable portfolio standard. Systems could
aggregate and sell the credits to utilities to satisfy RPS targets;
however, the sales will not earn as much for the sellers as
credits from an in-state wholesale generator.
That said, our strategy is to use every possible lever to
reduce greenhouse gas emissions. We are looking at energy
efficiency, transportation and grid efficiency. We have wrung a
lot of emissions out of the California system and are now starting to push the boundaries. We are looking
next at electric rates and operational issues to achieve greater
MR. MARTIN: The governor’s goal of 1.5 million electric cars
by 2025 should increase electricity demand and mean that the
state RPS target of 33% is 33% of a larger figure. Are there any
projections of how much additional renewable capacity will be
needed by 2025 as a consequence of the electric cars?
MR. WEISENMILLER: When we forecast demand, we project
out for 12 years, so we include electric vehicles, distributed
generation, the economy and the changing demographics in
California. We have goals for zero-emissions vehicles. Some
could be electric; some could be fuel cells or advanced biofuels.
At this point, it seems like electric vehicles are winning, but 12
years from now, the field will probably be more wide open.
Then you have to consider how much change in vehicle mix
there will be in southern California versus northern California.
The air quality issues in Los Angeles are so severe that air
quality will force more rapid change in the south.
Electric vehicles are expected to add around 5,500 GWh of
electricity use statewide in 2024, and that adds up to about
200 megawatts of additional capacity needed. You also have
to take into account the capacity factor and whether people
will charge during on-peak or off-peak hours. Until this year, we
were really focused on trying to do off-peak charging. However,
given that we have so much solar being built, we may need to
encourage people to charge between noon and 3 p.m.
Need for Additional Capacity
MR. MARTIN: The state as a whole is not short on capacity. It
has a 20% reserve margin for a 1-in-10 weather event. The issue
really is the transmission system in the LA Basin and in San
Diego. The grid is not configured to import electricity to the
area that was served by SONGS. You said the grid also needs to
replace the voltage support that it received from SONGS.
DR. WEISENMILLER: Location really matters because you
have a load pocket. We have a tendency to think of energy and
capacity when we really need to look at other things as well.
One is contingency response. We also need reactive power. It is
not just how do we keep the lights on, but how we find power
with the right characteristics.
We are very focused on Orange County and San Diego.
Orange County was served by SONGS and Huntington Beach
and, as you move away from those areas, the capabilities to
provide support drop off. The California ISO does very detailed
power flow modeling that allows us to ramp up certain
facilities to best serve areas in need, but location will be a paramount consideration for new facilities. Any new project must
really be in San Diego or Orange County.
MR. MARTIN: Besides the immediate need in Orange
County, what other opportunities do you see for power development in the LA Basin and San Diego?
DR. WEISENMILLER: San
Diego and the LA Basin have
seen 400 megawatts a year in
load growth at a time when we
are expecting retirements.
SONGS is gone. Some El
Segundo units have been
retired or repowered. Other
units will retire either because
of once-through cooling or their
economics. We are losing about
12,000 megawatts in nameplate capacity, but we only
need to replace about 7,600 megawatts. We do not need to
replace all of the older units.
From a contingency planning basis, there are some pretty
significant time points. The Encino project has to be retired or
replaced in 2017, and that is 946 megawatts. Around 2021,
another 3,800 megawatts in the LA Basin will be retired. We
have talked to the water board about adjusting some of the
deadlines if we have to, but these are very old and inefficient
plants. We have a new transmission line, SycamorePeñasquitos, which we are hoping to bring on line in 2016.
The 7,600 megawatts are a combination of conventional
and unconventional units, and some projects to replace them
have already been authorized.
MR. MARTIN: That is 7,600 megawatts over what time
DR. WEISENMILLER: By 2022. We are also looking at transmission options. If we could find the right transmission option
that could allow greater sharing between the LA Basin and San
Diego, it would reduce the need for new generating capacity.
MR. MARTIN: There are three different estimates for the
additional generating capacity needed to serve the LA Basin
and San Diego. Yours is 7,600 megawatts over the next four
years. That is a 5.5% increase in current generating capacity,
but the California ISO has a different estimate, and SDG&E and
Southern California Edison have yet another estimate. Why
such a range in views, from 1,800 to 4,300 megawatts by the
two utilities at the low end to your estimate of 7,600
DR. WEISENMILLER: It is good to put things in context. The
figure 7,600 megawatts was a consensus figure among the
staffs of three agencies, the California Public Utilities
Commission, the California Energy Commission and the
California ISO, with input from Edison and SDG&E. We took
into account the potential effects of government policies, not
just of our agencies but also the California Air Resources Board,
the State Water Resources Control Board and the South Coast
Air Quality Management District. We came up with a draft
plan, but the next step is specific proceedings at each of the
agencies, followed next summer by another look at the
In the meantime, the CPUC has been moving ahead with
procurements. A number of bids came into Edison in
December 2013 for providing power under a procurement the
CPUC authorized when the assumption was still that SONGS
would resume operating.
The CPUC took testimony recently from the CAISO and
others about what the needs are without SONGS. We are
saying about 3,000 megawatts in the short term. Edison and
SDG&E have asked for at least another 500 megawatts each as
part of the SONGS replacement. The CPUC draft decision
might be out in the next month or two.
Meanwhile, the CAISO is in the midst of a transmission planning process. Transmission proposals will be submitted at the
end of the month. They could conceivably reduce the 7,600
megawatts by 1,000 megawatts.
MR. MARTIN: The 500 megawatts each for Edison and
SDG&E is capacity that the utilities would build and own
DR. WEISENMILLER: Each of the three investor-owned utilities will be asking for bids for a build-own-transfer project.
Each will be asking for bids not only to build generating facilities, but also new transmission lines. Three or four bids have
been submitted to build the Sycamore-Peñasquitos line. We
expect proposals from Edison and SDG&E to build transmission, and we expect competing bids from independents. The
utilities have also expressed interest in energy storage.
MR. MARTIN: The staffs of the three agencies recommended that half the 7,600 megawatts of additional capacity
should come from preferred resources. Preferred resources are
energy efficiency, demand response, renewable energy, combined heat and power and storage. The hierarchy after preferred resources is transmission and then conventional power
plants. You said many of these megawatts are already in the
works. The net additional capacity needed over the next four
years, after backing out projects that are already in the works,
is probably well under 6,000 megawatts, right?
DR. WEISENMILLER: Yes. A difficulty with the preferred
resources on offer is they are not as targeted as needed. We
really need to get retrofits in Orange County. The preferred
resources need to provide not just energy or reduced demand,
but also provide some of the other characteristics.
MR. MARTIN: The need could be a lot less if new transmission lines are built to allow additional electricity to be imported.
DR. WEISENMILLER: Edison and SDG&E were pretty creative
at coming up with transmission options. The options are more
illustrative of what is possible than of what will actually be
built. If we can find a better way to shift power back and forth
between the LA Basin and San Diego, we will reduce the
amount of new generation needed. Building a high-voltage
line through southern California is a daunting challenge. It
would take at least eight years. One of the most interesting
ideas is for an offshore cable. The undersea cable would be a
way to do something more quickly.
SDG&E has proposed a high-voltage DC line from Imperial
Valley to SONGS. It is trying to use the existing high-voltage
infrastructure rather than build a new AC
line. Edison has come up with some proposals that strengthen
the grid within the Los Angeles area. There are a lot of proposals. Transmission lines will provide us a way to reduce the need
for conventional generation, but they are very tough to site
and permit. We are waiting next for a CAISO evaluation of the
relative costs and benefits from some of these options.
MR. MARTIN: Rooftop solar is very popular in California. I read
that 72% of all new capacity added in the US in October was
solar. California added 1,000 megawatts of rooftop solar in
each of the last two years, and the pace is accelerating. How
much of the capacity needs in the LA Basin and San Diego are
expected to be met with rooftop solar?
DR. WEISENMILLER: Our forecast is that installed rooftop
capacity will more or less triple in southern California by 2024.
The rapid expansion is creating tension with the regulated utilities. The CPUC is starting proceedings to look at net metering
and rate design issues. Rooftop solar does not yet provide
some of the attributes we are looking for, so it is not the sole
solution. One form of reactive power that we are trying to
push is smart inverters that would help provide ancillary services. However, before announcing such a standard, we need
to make sure California is relatively in sync with the rest of the
country. We have well over 100,000 new solar applications. A
lot of those are for distributed solar installations of less than
20 megawatts. We have an explosion of development on the
photovoltaic side, and the economics have come down in a
MR. MARTIN: Under California rules, out-of-state renewable
energy suppliers are at a disadvantage. Why is that, and does
the disadvantage extend more generally to all types of out-ofstate supply?
DR. WEISENMILLER: When the legislature established the
33% RPS goal, it expressed a strong preference for relying on
suppliers who are directly connected to a California balancing
authority. Californians are willing to pay more for electricity
from renewable sources, but they also want the economic
benefits to inure to California. I am often approached by outof-state suppliers who say they can help us reach the 33%
target, but existing power contracts will already take us well
The issue becomes how out-of-state generators fit into the
next stage of expansion. The next stage will be driven by the
need for emissions reductions. When it comes to emissions,
more regional solutions are better.
MR. MARTIN: So the existing impediment for out-of-state
suppliers does not apply to electricity from gas-fired power
plants, just from renewables?
DR. WEISENMILLER: Right, and it is a complicated structure.
There are some regional transactions, but the split for renewable procurement is around 70% in-state and 30% out-of-state,
which is similar to the overall split between in-state and outof-state generation.
MR. MARTIN: What effect is the need for capacity in the LA
Basin and San Diego likely to have on wholesale power prices?
MR. WEISENMILLER: The US
Administration is expecting
some increase in wholesale
power prices in California. The
drought had some impact and
gas prices have ups and downs,
but all else being equal, you
would think that not having
SONGS would tend to push
prices up. However, the counterweight is that we have a lot
of very new, very efficient combined-cycle plants running at around a 45% capacity factor. It
is a very competitive market, and that forces everyone to
figure out ways to keep costs low. Natural gas drives marginal
electricity prices in California and, ignoring brief aberrations,
gas prices have been remarkably low for a while.