Natural-gas-fired electricity generation could increase over the next five years due to drought and a lower amount of imported power, energy officials said this week.
Recurring drought in the West might reduce the amount of hydropower resources that are available to California, while imported power amounts become more uncertain over time, California Energy Commission senior policy specialist Melissa Jones said in a July 14 e-mail to California Energy Markets. Hydropower, imports, and natural gas generation can quickly ramp up and down, depending on electric grid needs, and can start and stop throughout the day, Jones said. Therefore, natural gas generation could increase over the next five years to make up for hydropower and import losses, she said.
“When droughts occur, we end up relying more on natural gas,” Jones said at a July 9 CEC workshop on natural gas reliability.
In 2001, natural gas accounted for about 56 percent of in-state generation but dropped to about 52 percent in 2010 and to about 48 percent in 2020. California’s SB 100 requires that all retail electricity sales to end-use customers in 2045 must be generated by zero-carbon energy resources, but the law does not apply to non-retail sales, storage losses, or transmission and distribution line losses. Therefore, about 3,000 MW of natural gas capacity would be retired by 2045, leaving about 37,300 MW of gas capacity in the state by that time, according to the CEC. In 2019, the state had about 40,300 MW of natural gas capacity (see CEM No. 1606 ).
In the long-term, demand response, battery energy storage, geothermal resources and pumped energy storage are expected to reduce the amount of gas generation on the grid, Jones said. As more renewables penetrate the grid, the need for flexible resources that can be controlled by the system operator will increase, she said.
Likewise, as the number of heat events increase in the region, air conditioning will drive natural gas electric generation demand higher, Aspen Environmental staff member Joseph Long said at the workshop.
Officials do not expect natural gas electric generation curtailment this summer, California Public Utilities Commission staff member Kristina Abadjian said at the workshop. Curtailment probability increases if multiple back-to-back hot days occur as withdrawal capacity dwindles, she said.
Natural gas demand in California has been declining since 2013 and is expected to continue to decrease about one percent each year going forward through 2034 in Pacific Gas & Electric and So Cal Gas territories. Natural gas demand peaked in 2013, hitting about 6,400 MMcf per day in the state, with about 2,000 MMcF used for electricity generation, CEC staff said at the workshop. In 2020, gas demand peaked at about 5,800 MMcF per day, while in 2034, demand is estimated to be about 5,000 MMcF, staff said.