California may need to invest up to $50B in readying grid for electrification influx: report
Power transmission towers line a street in Redondo Beach, Calif., on Sept. 7, 2022. With record demand on power supplies across the West, California snapped its record energy use with 52,061 megawatts, far above the previous high of 50,270 megawatts set on July 24, 2006.
California may need to invest up to $50 billion in updating its electricity grid over the next 12 years in order to fulfill its climate goals, a new report has found.
The landmark SB 100 bill, passed in 2018, set a target of powering statewide electricity needs with 100 percent clean energy by 2045. But achieving this ambition will be an expensive task, warned the report, conducted by data analytics firm Kevala for the California Public Utilities Commission.
“California is at a turning point in its efforts to decarbonize at scale,” Aram Shumavon, the founder and CEO of Kevala, said in a statement.
“After decades of minimal load growth on the electric grid, we are shifting into an era of capacity expansion to enable decarbonization,” he added.
That transition, Shumavon explained, will necessitate “significant investments to meet climate goals while delivering carbon-free energy in an affordable, reliable and equitable manner.”
To draw their conclusions, Kevala researchers analyzed more than 100 terabytes of data from more than 12 million premises throughout California — including three years of automated metering infrastructure records, geographic information system data and customer rate information.
The researchers then used a modeling approach that accounted for the potential impacts of both electrification and distributed energy resources — such as rooftop solar and battery storage — at the premises level, according to the report.
From there, they identified the specific locations and timing where grid upgrades would need to occur to support expected increases in electric vehicle charging.
The $50 billion estimate was formulated based on traditional utility distribution infrastructure investments, without considering future cost minimization approaches, the report acknowledged.
Some such alternatives might include real-time dynamic electricity rates and flexible load management strategies, per the report.
California’s aging grid may also need site-specific upgrades to support today’s distributed energy resources and load, even without additional such installations, according to a cover sheet from the California Public Utilities Commission.
“California’s electricity grid is changing rapidly, driven by significant changes at the premise level,” the Kevala researchers concluded.
The results of the report, they continued, could provide a foundation for distribution planners and policymakers seeking to implement “grid solutions based on the hyper-granular location of electrification needs.”
The report goes on to provide detailed recommendations for the state’s three major utilities as they formulate their future distribution plans.
“Improving California’s understanding of where and when electricity grid enhancements will be needed will likely require additional changes on multiple policy fronts,” the researchers added.