Study Finds California Can Close 28 Natural Gas Plants Immediately Without Affecting Electricity Reliability

Additional Plants Could be Shuttered with Investments in Battery Storage or Other Technologies

Published Aug 7, 2018

OAKLAND, Calif. (August 7, 2018)—California can retire at least 28 of its natural gas plants because they are no longer needed to meet the state’s electricity needs nor its carbon emissions reduction goals, according to an analysis released today by the Union of Concerned Scientists (UCS).

The study analyzed the operations of all 89 natural gas plants in the California Independent System Operator (CAISO) territory to determine how many plants could be retired between 2018 and 2030 without affecting grid reliability while still meeting the state’s ambitious emissions targets. CAISO manages the power supply and demand for about 80 percent of the state. The analysis concluded California will not need to build any new gas plants in CAISO territory now or through 2030 to meet its power needs.

“There are more than two dozen natural gas plants that are dead weight on the system and not necessary to keep the lights on,” said Laura Wisland, report co-author and senior energy manager at UCS. “It would be cheaper for California ratepayers if these plants were retired rather than paying to keep them operating.”

One reason for California’s abundance of natural gas plants can be traced back almost two decades. In response to the 2000-2001 energy crisis when residents experienced rolling blackouts and utilities risked or experienced bankruptcy, California commissioned many natural gas plants. At the same time, it pursued an aggressive renewable energy target. Now there are about 200 natural gas plants connected to the grid that together make up 33 percent of the state’s power mix.

Because natural gas can be stored and natural gas plants can be easily turned on and off, CAISO relies on natural gas during the “evening ramp” when solar power decreases, millions of Californians come home and electricity demand spikes. Natural gas also fills the gap when supply is limited during grid emergencies, such as when a power plant or transmission line fails. But the report points out that as more renewable energy comes onto the grid, a plan is needed to reduce future dependence on natural gas plants.

“Today, we have a booming market for clean, renewable energy and a glut of natural gas power plants,” said Wisland. “We cannot have both in the future if we want to reach our clean energy and climate targets. Without an orderly plan to retire unnecessary gas plants and usher in clean technologies, we risk having more carbon emissions and more pollution.”

Many of the plants the UCS report identified for closure are in disadvantaged communities in the Central Valley—an area affected by year-round air pollution. Across California, UCS found the number of natural gas plants that could be shut off by 2030 is double if additional battery storage or other clean energy investments are made.

The UCS analysis also found that without an alternative to natural gas, such as battery storage, during the evening ramp natural gas plants will start and stop much more frequently in the coming decade as renewable generation increases. Burning natural gas produces nitrogen oxides that create smog and aggravate respiratory health. Nitrogen oxide emissions associated with starting a plant are higher than emissions from a plant that operates continuously. The analysis found that in 2030 some plants that today run continuously would likely start and stop at least 200 times per year.

“The people living near natural gas plants cannot afford another ton of toxic fumes in their communities,” said Wisland. “We can address the air pollution, evening ramp and local reliability problems if we build alternatives to natural gas power plants in the communities most affected by pollution.”  

The UCS report identified regulatory and legislative solutions that would hasten natural gas plant retirements and reduce the need to turn plants on and off. Utilities should make investments to increase battery storage, shift more evening electricity demand to daytime hours, support diverse renewable generation technologies like in-state geothermal or access to out-of-state renewables, increase energy efficiency and target clean energy investments in disadvantaged communities, according to the report. Additionally, the California legislature should pass Senate Bill 64 that would require the state to obtain data on natural gas plant operations, prioritize the reduction of gas generation in disadvantaged communities and plan for gas plant retirements.

“If we’re truly committed to reducing carbon emissions and cutting air pollution, we must reduce our natural gas use in a way that helps the communities most affected and keeps everyone’s lights on,” said Wisland. “All eyes are on California to show the world how to wean millions of people and an enormous economy off fossil fuels. It’s imperative we get this right.”