Southern California Edison Co. has been given approval to build a major transmission line to improve its electrical grid but also must obtain new power from less polluting plants, the California Public Utilities Commission has decided.

Edison International, the utility’s Rosemead-based parent, is proposing to build a 272-mile transmission line from a switchyard near Phoenix to western Riverside County. The transmission project still faces other hurdles, including reversing a finding by the U.S. Fish and Wildlife Service that a portion of the line would harm a wildlife refuge in Arizona.

“This favorable decision is an important step in our efforts to bolster Southern California’s transmission system,” said Edison in a statement issued after Thursday’s decision.

At the same meeting, the PUC also approved a 10-year power contract that Edison reached with Long Beach Generation LLC, a subsidiary of Princeton, N.J.-based NRG Energy Inc. The agreement calls for 260 megawatts of natural gas-fueled peaking capacity for delivery starting on August 1. Financial terms of the deal were not disclosed.

This is the first contract Edison has signed in its effort to attract investment by independent power producers in new power plants for the Southern California region to address looming electricity shortages.

However, the commission also passed a greenhouse gas reduction regulation that requires all new long-term power supply agreements for baseload generation be with power plants that produce less than 1,100 pounds of carbon dioxide per hour.

This would bar power supplies from coal-fired plants like one that Edison recently divested from in Mojave, Nevada. Environmentalists blamed that power plant for contributing to pollution around the Grand Canyon.