Report: Regional Power Grid Would Create Thousands Of California Jobs In Renewable Energy Industry
By Kevin Smith, ORANGE COUNTY REGISTER
July 18, 2018
A proposed network aimed at serving the electricity needs of California and other Western states would lower energy costs, spur a greater use of renewable energy and create another 10,000 to 20,000 jobs a year in California by 2030, an industry group claims.
Next 10, a nonpartisan organization that seeks to improve the Golden State’s future, reached that conclusion in “A Regional Power Market for the West: Risks and Benefits.” The report takes a fresh look at the pros and cons of the plan.
Fueled by AB 813
The impetus for creating a regional Independent System Operator (ISO) comes from Assembly Bill 813, authored by Assemblyman Chris Holden, D-Pasadena, and Assembly members Jim Patterson, R-Fresno, and Bill Quirk, D-Hayward. The measure was introduced in February 2017 and has been amended several times.
It will come up for further consideration when the state Legislature resumes session in early August.
“We need long-term solutions to reduce greenhouse gas,” Next 10 founder F. Noel Perry said. “We need to determine the best options to increase the use of clean energy in the west. A regional grid would make energy more reliable and affordable for Californians.”
More jobs, lower costs
The network, Perry said, could result in some renewable energy construction jobs moving from California to other states. But that would be more than offset by lower electricity prices, which would reduce costs for businesses and encourage across-the-board job growth.
The report includes two regional ISO scenarios. Under one, California would continue to buy most of its power in-state or from nearby sources. By 2030, that plan would create an additional 20,000 jobs a year through lower energy costs and the construction of wind, solar and geothermal projects.
The second scenario would see California buying its energy from anywhere. That would create an extra 10,000 jobs a year by 2030.
The additional jobs would range from workers pouring concrete and operating cranes, to people installing solar panels and wind turbines.
Bentham Paulos, who authored the study and is a principal with the energy policy and consulting firm PaulosAnalysis, said costs would be further reduced by a consolidation of backup energy plants.
“Right now there are 38 different regions across the West and every one of them has to have their own backup plants for reserve power,” he said. “If we were able to consolidate all of those into a few bigger ones we could share those resources and there wouldn’t have to be as many backup power plants. That would be a big money saver.”
California also stands to gain when it comes to wind power, according to Paulos.
“California’s wind-power resource is not all that great, although it’s OK,” he said. “Wyoming and New Mexico are much windier and have faster winds.”
Kellie Smith, a spokeswoman for Assemblyman Holden and chief consultant for the Assembly Utilities and Energy Committee, said California’s transmission network and the networks of 13 other Western states are already interconnected. But the sharing of energy has been on a piecemeal basis.
“The other areas are controlled by 37 balancing authorities, and they are all dispatching power on that system,” she said. “We already share some power with those entities. This bill would facilitate an expansion of the ISO so other operators could choose to join in.”
Opponents of the proposal
Critics of the plan fear a regional ISO would force state policymakers to give up control of their individual power grids. But the Next 10 report notes that California’s independent system operator (CAISO) already functions apart from state control.
All regional transmission operators, including CAISO, are currently subject to Federal Energy Regulatory Commission regulations and federal law, the report said.
“There wouldn’t be much difference as far as regulation,” Perry said.
The organization said turning the clock back to “the deregulation-era scheme of a Western wholesale power-trading market” threatens ratepayers with speculative profiteering and a derailment of California’s transition away from fossil fuels like coal.
Declining use of coal
Perry said the industry’s continuing move away from coal is inevitable.
“The use of coal is declining across the U.S.,” he said. “Wind and solar are much more competitive these days, and in many instances, they’re cheaper than coal. Wind prices coming out of Wyoming just went down and natural gas is significantly cheaper than coal. The concern over coal doesn’t seem to hold much weight.”
Increased market enforcement
Paulos also addressed the concern regarding traders and marketers who might seek to boost electricity prices in the same way they were skewed during California’s energy crisis of 2001 and 2002, which led to rolling blackouts.
“Many things have changed since then,” he said. “Legislation was passed in 2005 that gave more authority over monitoring market behavior. FERC’s enforcement division is staffed with 200 people and regional transmission operators are monitored on a daily basis.”
A 2016 CAISO study shows that a multi-state transmission network would help California reach its 50 percent renewable energy goal by 2030 while also saving consumers up to $1.5 billion.
Kevin Smith handles business news and editing for the Southern California News Group, which includes 11 newspapers, websites and social media channels. He covers everything from employment, technology and housing to retail, corporate mergers and business-based apps. Kevin often writes stories that highlight the local impact of trends occurring nationwide. And the focus is always to shed light on why those issues matter to readers in Southern California.