Energy Efficiency, Energy Procurement, Industrial, Utilities, Industrial, Sourcing Renewables  -  June 27, 2016

PG&E to replace nuclear capacity with energy efficiency, renewable energy generation

Amid a changing energy landscape in California, including the planned closure of the state's last nuclear power plant, Pacific Gas and Electric Co. has announced a joint proposal that aims to drive investment into energy efficiency and renewable generation sources.

The proposal, which PG&E said it reached with labor and environmental organizations, would increase investment in energy efficiency, renewables and storage beyond current state mandates to replace PG&E's production of nuclear power in the state by 2025. The investor-owned utility holding company plans to shut down the two nuclear reactors at  its Diablo Canyon power plant in 2024 and 2025.

As outlined in the proposal, PG&E aims to replace the 2,160 MW of power produced at Diablo Canyon with "a cost-effective, greenhouse gas free portfolio of energy efficiency, renewables and energy storage," PG&E said in a news release. It also includes a PG&E commitment to a 55% renewable energy target in 2031, which the company called "an unprecedented voluntary commitment by a major U.S. energy company." 

PG&E explained further:

Underpinning the agreement is the recognition that California’s new energy policies will significantly reduce the need for Diablo Canyon’s electricity output. There are several contributing factors, including the increase of the Renewable Portfolio Standard to 50 percent by 2030, doubling of energy efficiency goals under SB 350, the challenge of managing overgeneration and intermittency conditions under a resource portfolio increasingly influenced by solar and wind production, the growth rate of distributed energy resources, and the potential increases in the departure of PG&E’s retail load customers to Community Choice Aggregation.

The parties to the Joint Proposal are PG&E, International Brotherhood of Electrical Workers Local 1245, Coalition of California Utility Employees, Friends of the Earth, Natural Resources Defense Council, Environment California and Alliance for Nuclear Responsibility.

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