Building a prosperous energy future for Southern California night be one of the greatest collective challenges the state’s policy influencers and energy industry leaders have ever faced.
That challenge became even more daunting earlier this year when Southern California Edison announced its decision permanently to close the San Onofre Nuclear Generating Station. The facility will undergo a decommissioning process that is set to take place over about 10 years.
Regardless of what you think about whether the nuclear facility should have been shuttered, the fact is that San Onofre was responsible for providing a massive amount of power to Southern California homes. When operational, it produced 2,200 megawatts, enough to power about 1.4 million homes.
Now, aside from issues complicating the region’s long-term energy future, state leaders must solve the difficult problem of replacing a power supply that Southern California families are already depending on every day.
Over the last few months, there has been a great deal of discussion on this issue among a diverse array of stakeholders, from energy industry leaders to environmentalists. Many advocates of renewable energy expansion have suggested that about half of this outstanding power demand could conceivably be met using renewable resources like solar power.
While renewable energy will play an increasingly significant role in California’s energy future, it is a long way from being capable of filling in the gap that will be left by San Onofre’s decommissioning. Even the most optimistic renewable energy advocates admit that expanding our capacity to generate these resources would require energy loan programs and other expensive initiatives to create and grow an energy infrastructure that doesn’t currently exist on a broad scale.
California Public Utilities Commissioner Michel Florio recently acknowledged, “In the next five or 10 years, we don’t yet have the technology to provide the 24-7 reliability people have come to expect, with renewables.”
Filling the regional energy gap left by San Onofre is a critical energy issue, and the immediate stakes couldn’t be higher. So, instead of using this crucial moment to focus on the development of a renewable energy infrastructure that, even when the technology is developed, will take decades and billions of dollars to incorporate, we should prioritize the identification of concrete, near-term options for rebuilding a reliable supply of affordable base-load energy for Southern California.
According to a report from the California Senate’s Energy, Utilities and Communications Committee, the L.A. Basin has a handful of existing coastal power plants – in El Segundo, Redondo Beach, Alamitos and Huntington Beach – that are allowed to operate at only a fraction of their capacities. Together, they are authorized by regulators to deliver a maximum of 1,400-1,800 megawatts. Their collective capacity is easily more than twice that amount at about 4,475 megawatts.
We see a similar situation as we move south along the coast. In San Diego, the Encina and South Bay power plants are authorized to deliver a total of about 340 megawatts. Their collective capacity is almost 950 megawatts.
Other problems
All of these facilities generate their power from natural gas, the most abundant, cleanest low-cost energy resource we have in the United States.
More importantly, though, with coal and nuclear energy now out of the question in California, expanding the use of these natural gas facilities represents virtually the only option for substantially increasing our supply of base-load energy in the short term.
In looking at the sizable power capacity we’re leaving on the table in Southern California, it’s clear to see that we can be demanding more of our existing energy infrastructure to help fill the supply gap that San Onofre is leaving behind.
Obviously, repowering some of these existing facilities won’t resolve the power supply issues entirely, with so many other problems to address, such as reorganizing the power transmission grid that revolves around the San Onofre plant. However, producing more power with these facilities is a significant step in the right direction.
In the coming decades, expanding our tool kit with the development of a more robust renewable energy infrastructure will certainly be an important endeavor. But, right now, with such a tight timeframe for decision-making and so much at stake for Southern Californians, let’s focus on what we can be doing with the proven resources we already have to solve this critical problem.
John T. Young Jr. manages the Western region of Conway MacKenzie in downtown Los Angeles, a middle-market financial restructuring and advisory firm. He specializes in crisis management and financial advisory to the energy sector.
