FOLLOW US

California may be finished with natural gas – at least in the long term. Current plants will probably live out their life cycle, but there’s a good chance that there won’t be any large natural gas plants built in the state of California in the future. Small, efficient, and clean plants may need to come on line before the full transition to renewable energy is made, but the end is clearly in sight for California’s natural gas industry. There have been numerous events pushing the state in this direction, including the ongoing battle with climate change and the devastating recent natural gas leak in Aliso Canyon.

Current Projects on Hold or Mothballed

Many older natural gas power plants in California are approaching the end of their usable life. Some are nearing 70 years old and can’t be sustained much longer. The state’s major utility companies, such as Southern California Edison and Pacific Gas and Electric, expected to replace these aging plants with new and efficient natural gas plants, but those plans seem to be in serious jeopardy. In a surprise move, the proposed 262-megawatt Puente power plant was put on hold with no sign that the project would be restarted any time soon.

A similar story is playing out all over California. The California Energy Commission and the California Public Utilities Commission have put the brakes on recent projects while they revaluate if they’re actually necessary. The argument against building new natural gas plants or refurbishing existing ones isn’t just about the environmental impact of such projects. There are also practical financial reasons for putting these projects on the backburner.

Added Expenses of Over Capacity

California has been running over capacity in the energy sector for a number of years now. The costs of trying to deal with this extra capacity are driving up prices for the average resident instead of reducing them. The state actually has to pay other states to take their extra capacity at times so that the system doesn’t overload. There doesn’t appear to be any need for new natural gas plants to come on line, especially with more renewable projects being introduced as California moves closer to its clean energy targets of 2020 and 2040.

Major Utilities Not Onside

Major utilities, such as Pacific Gas and Electric and Southern California Edison, are not in agreement with the push to prevent new natural gas plants from being built or having older ones upgraded. They believe that these plants are needed to cover the transition period as we move from fossil fuels to renewable energy. The facts just don’t seem to support their conclusions. Most of the older plants that are about to go offline are running at less than 25% capacity, which suggests they don’t need to be replaced.

Environmental Lobby Praises Halt on Natural Gas Plants

On the other side of the argument are the environmental lobbyists such as the Sierra Club. In their opinion the state isn’t moving fast enough in the move towards renewable energy and they point towards disasters such as the leak at Aliso Canyon as proof that the timetable needs to be moved up for both environmental reasons and for the safety of California’s citizens. They were ecstatic when the state of California decided to take another look at plans for new natural gas plants before allowing them to proceed.

Renewable Targets Ahead of Schedule

Overcapacity isn’t the only reason that there seems to be a good case for putting the brakes on plans for new plants. California is way ahead of schedule in reaching its renewable energy targets. The major utility companies in the state have already met or exceeded their 2020 targets and are expected to reach their 2030 targets by 2020.