Dive Brief:

• The Carlsbad, California, City Council and San Diego Gas & Electric have approved a deal that clears the way for NRG Energy to build a 588-MW peaking plant.
• As part of the deal, NRG will tear down the Encina power plant in Carlsbad, which faced retirement under California's once-through-cooling restrictions.
• The new plant would help SDG&E replace its share of the 2,150-MW San Onofre nuclear plant, which was permanently shut down last summer.

Dive Insight:

The City Council strongly opposed a new power plant, but believed NRG's plan to build a smaller peaking plant had advantages for the city.

Closing the San Onofre plant, which accounted for about 20% of SDG&E's power supply, and the looming shutdown of several power plants that use once-through-cooling has left Southern California utilities searching for new power supply. Moving ahead with the NRG plant will have a ripple effect on the other supply options available to SDG&E.