Dive Brief:

• A California Public Utilities Commission (CPUC) administrative law judge this week issued a ruling recommending that the state adopt a preferred electricity resource portfolio that would limit the sector's annual greenhouse gas emissions to 38 million metric tons (MMT) by the end of the decade.
• The ruling is the result of the commission’s analysis of the integrated resource plans filed by state power providers last year. While the analysis found that the plans themselves could collectively fall short of state emissions and reliability targets, it noted that a combination of other factors — including a recent 11.5 GW procurement decision — should "largely" achieve those goals for 2030.
• Last March, the CPUC voted to approve a 46 MMT greenhouse gas emissions target for the electric sector for 2030. But regulators also asked power providers to look into reducing emissions further to 38 MMT, after multiple stakeholders — including utility Southern California Edison — questioned whether the target went far enough.

Dive Insight:

The new ruling includes the commission’s analysis on the 44 integrated resource plans that were filed by California power providers last summer, which included separate plans to meet their respective portions of the 46 MMT and 38 MMT targets by 2030. The differences in the electric resource build-out needed to meet both targets would be relatively small — less than 500 MW — until 2024, but amount to around 5,400 MW by the end of the decade, according to the analysis.

"We think it’s a positive development, and it brings us closer to the path we need to be to get to zero-carbon by 2045," said Mohit Chhabra, a senior scientist with the Natural Resources Defense Council. 

Chhabra noted that if the CPUC were to adopt this new target, the transmission plan that the California Independent System Operator will conduct next year will also align with it.

"So the grid will be better prepared to take on all these new renewables that need to come online to meet that goal," he said.

Last year, SCE filed comments with the commission recommending a 38 MMT limit, and noting that it had significant concerns that a 46 MMT planning target would not set the electric sector on the path to meet California's 2030 and 2045 carbon reduction goals.

The 38 MMT target outlined in the administrative law judge's ruling can put California on track for reaching its deep decarbonization goals, said Jeffrey Monford, spokesperson for parent company Edison International.

"The 2030 and 2045 goals are feasible, but will require a significant restructuring in the state's energy mix, with a clean electric grid serving as a foundation for powering this decarbonized future," Monford added.

The CPUC intends to hold a workshop on the analysis in late August, and stakeholders can file comments on the analysis by Sept. 27. If the commission were to adopt the 38 MMT portfolio recommended in the ruling, power providers would be expected to begin developing the resources needed to achieve it. However, the ruling highlights the need for a deeper look at the procurement implications of this decision, noting that it is "uncertain whether such guidance, along with existing markets and programs, is sufficient to ensure meeting the 2030 goals."

Most of the procurement required to meet this goal can be accomplished by meeting the requirements of the 11.5 GW procurement decision, Chhabra said.

Michael Colvin, director of regulatory and legislative affairs at the Environmental Defense Fund, noted in an email that the roughly 500 MW near-term difference between the two scenarios is relatively modest, and amounts to less than one power plant.

"The lift will be thinking through coordinating access to land, transmission and other competing resources," Colvin said. 

The ALJ's ruling also touches on broader reliability questions that California regulators have been grappling with. For instance, it solicits stakeholder feedback on potentially accelerating the installments of resources included in the CPUC’s 11.5 GW procurement order, in the wake of Gov. Gavin Newsom’s recent emergency proclamation. In addition, it asked parties to weigh in on two proposals to bolster offshore wind development in California, including preserving the use of transmission deliverability rights along California’s central coast area, which has the capacity to allow for around 5 GW to 6 GW of offshore wind generation.