Tx Tower Trio 0716

Power lines in San Mateo. CAISO narrowly avoided blackouts during a recent heat wave, but the threats to grid reliability will not be going away any time soon.

California's electricity grid is already running close to the edge a few weeks into summer, with grid officials raising the alarm over short capacity and dwindling energy import capability—challenges that are shaping up to be in place for years to come.

The California Independent System Operator was operating under Stage 2 emergency conditions—the final step before rolling blackouts—on July 9, the Friday before last weekend, as the Bootleg Fire took out the California-Oregon Intertie, leaving CAISO 4,000 MW short. Coastal natural gas plants also went on forced outage during that time. Gov. Gavin Newsom declared an emergency on July 10, easing air permitting for backup diesel generators and putting more—if dirtier—megawatts onto the grid. CAISO issued three Flex Alerts in four days calling for energy conservation from the public, which has become a regular operational tool for the ISO.

CAISO is reviewing the results of its recent solicitation of backstop energy under its capacity procurement mechanism, CAISO President and CEO Elliot Mainzer told the Board of Governors at its July 15 meeting, just before the board reluctantly approved another reliability must-run contract, this one for Calpine's Agnews natural gas-fired plant in San Jose.

"We cannot have a failure in planning year after year," Board of Governors Chairwoman Angelina Galiteva said at the meeting.

Mainzer said at the meeting that early, widespread heat events during the last days of spring and first weeks of summer "indicate that the prevailing pattern of extreme temperatures, drought and declining hydro conditions is likely to extend across the summer, increasing the probability of stressed grid conditions." He noted CAISO is working on a " much more proactive, comprehensive and forward-looking evaluation of both in-state and out-of-state transmission facilities" to meet procurement and renewable energy goals.

"The ISO remains hyper-focused on reliable operations using all available tools, with a continued focus on outage management, effective communication, and deployment of Flex Alerts as necessary," Mainzer said.

As Mainzer gets into his rhythm as the ISO's leader, it's clear he has put a huge focus on collaboration, outreach and communication with regulators and utilities not just in California, but in other states. As former head of the Bonneville Power Administration, he has years of experience in the West. He has also increased outreach to media, calling hastily arranged news conferences to promote Flex Alerts.

Battery storage, seen as the Knight on the White Horse to save Californians from blackouts, are beginning to show their worth, recently cresting 1 GW on the grid and, according to Mainzer, already helping shave demand off the evening peak.

Amid all this, Newsom, facing a September recall election, on July 9—the same Friday grid operators were scrambling to scrape up the megawatts needed to keep the lights on—said California will accelerate its pursuit of a zero-emission grid.

Newsom met virtually with scientists and experts on the topic of climate change, and directed the California Public Utilities Commission and the California Air Resources Board to explore pushing forward the 100-percent zero-emission grid envisioned by the SB 100 legislation, from 2045 to 2035.

Newsom said in a news release that he wants new strategies "to reduce fossil fuel demand and supply," The CPUC will work to establish a more ambitious greenhouse gas emissions target for electricity procurement by 2030. CARB will analyze pathways to phase out oil extraction, focusing on disadvantaged communities, job creation and economic growth.

Newsom on July 12 signed SB 129, legislation that reflects the majority of the 2021-22 state budget agreement, including the $100-billion "California Comeback Plan." The plan includes a $3.9 billion package to help California meet its zero-emissions vehicle goals, and Newsom said the administration will work with the state Legislature to allocate $3.7 billion over three years to better prepare the state for extreme heat and sea-level rise and address environmental justice priorities.

With all these factors in play, it couldn't be more obvious that California is in a state of "just-in-time" energy planning, with all its inherent risks to electric grid reliability and quality of life for its residents.

State regulators have ordered utilities to procure capacity, but it's become apparent that the entire West is short on capacity. The scarcity of megawatts around the region is already having repercussions in the beginning weeks of summer, a year in which wildfire levels and drought are more severe, exacerbating the reliability challenges faced by regulators and grid planners.

But it's not like California is seeing unprecedented levels of demand. Demand peaked at about 43,000 MW on July 9 when an emergency was declared, about 7,000 MW lower than the all-time peak record set in July of 2006, 15 years ago. Also, climate change and heat waves are nothing new—that demand peak in 2006 was during a scorching heat wave, but there were no blackouts then.

The end result is that regulators, CAISO and the state's residents are holding their breath as summer heat blazes on, and California's grid is stretched to its limit.

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