CA Gov. Newsom pushes controversial energy package

Continuing his crusade to fortify California’s troubled electricity grid, Gov. Gavin Newsom is pushing last-minute legislation that would give the state authority to streamline approvals for new energy projects — and potentially prolong the lives of the state’s last remaining nuclear plant and a group of aging fossil fuel plants in Southern California.

Environmentalists denounced a pair of budget trailer bills — AB 205 and SB 122 — that would give the state Department of Water Resources and California Energy Commission broader powers to bring new projects online quickly.

The bills’ language was released Sunday and comes less than two months after Newsom urged the Legislature to approve a $5.2 billion “strategic energy reliability reserve” to increase electricity power and storage capacity. The legislation was likely to reach the Assembly or Senate floor late Wednesday; the deadline for passage is Thursday.

The legislation reflects Newsom’s fervent desire to avoid another round of rolling blackouts similar to the outages that plunged hundreds of thousands of Californians into the dark on consecutive nights in August 2020, when a triple-digit heatwave across the West overwhelmed the state’s power grid. The state barely avoided more blackouts during another major heatwave last July, and state officials have warned that more blackouts are possible this summer as climate change and drought squeeze power supplies.

Opponents’ concerns about proposed bills

Environmentalists say the trailer bills, first reported by news outlet Cal Matters, would allow Newsom’s administration to eliminate a host of regulations to speed projects into existence. While they support green-energy projects, they’re wary of efforts to cut regulatory corners.

“This is a really broad, far-reaching exemption that bypasses CEQA,” said Matthew Baker of the Planning & Conservation League, a Sacramento-based environmental group. CEQA, the California Environmental Quality Act, requires extensive environmental reviews on a wide array of development projects.

Local governments are fighting Newsom’s plan, too, saying it would allow the state to approve solar and wind farms and other renewable-energy projects without securing local approvals. The legislation “is overly broad, usurps local control, excludes local governments from meaningful involvement in major development projects within their jurisdictions and could result in even more litigation,” lobbyists for local governments said in a note to lawmakers.

Legislation could impact Diablo Canyon closure

Among other things, the new legislation would allow the Department of Water Resources, using funds from the strategic energy reserve, to purchase electricity from Diablo Canyon, the state’s last nuclear plant, which PG&E Corp. is scheduled to close in 2025. The agency would also be able to buy power from a fleet of aging natural gas-fired plants on the Southern California coast, which are set for retirement in late 2023.

The legislation by itself wouldn’t mandate that Diablo Canyon and the gas-fired plants stay open, Ana Matosantos, the governor’s cabinet secretary, told the Los Angeles Times. Matosantos noted that saving the nuclear plant would require approval from the federal government.

But V. John White, a former legislative staffer and longtime environmental lobbyist in Sacramento, said the trailer bills demonstrate the Newsom administration is clearly bent on keeping those plants open longer in order to ward off the threat of blackouts.

White said “they’ve got to keep the lights on,” but the Newsom administration should have gotten its arms around the situation sooner.

“This is a 10-year problem that’s been coming,” White said. “Now we’re having to scramble.”

Newsom has previously said he’d like to see Diablo Canyon, which can produce as much as 9% of California’s electricity, remain in operation. He’s also supported previous decisions to postpone the closure of the gas-fired facilities, calling them a “necessary” compromise on climate change in order to maintain sufficient electrical supplies.

California’s drive for green energy has complicated grid reliability. As the state’s reliance on solar power has grown, it’s left the grid vulnerable during early-evening hours in major heatwaves: As the sun goes down, solar energy fades even as the temperatures stay hot. State officials have tried to counter that problem by promoting the installation of battery farms that can store solar energy for use during those critical hours.

But new complications have arisen. White said the administration’s concerns about grid reliability have intensified in recent months because of global supply-chain woes, which are affecting shipments of solar panels and long-term storage batteries.

“This is what’s got them shaken up,” White said.

The Bee Capitol Bureau’s Lindsey Holden contributed to this story.

This story was originally published June 29, 2022 1:08 PM.

Dale Kasler covers climate change, the environment, economics and the convoluted world of California water. He also covers major enterprise stories for McClatchy’s Western newspapers. He joined The Bee in 1996 from the Des Moines Register and graduated from Northwestern University.