California's Green Dream Faces a Reality Check

The state of California aims to offer 100 percent zero-carbon energy by 2045... Some might joke that's also when the rooftop solar panel you ordered this year will get installed.

Red tape, high costs, an aging grid... Will the challenges to the state's green dream render it waking nightmare?

In September 2022, California Governor Gavin Newsom signed the Clean Energy, Jobs, And Affordability Act of that year into law, an ambitious program introduced to the state legislature requiring zero-carbon sources to provide 90 percent of the state's energy by 2035, and, as mentioned above, 100 percent in 2045.

Achieving these milestones requires a dramatic ramp-up of clean energy production, with natural gas still accounting for 39 percent of Californian in-state electricity generation in 2023, according to the U.S. Energy Information Administration. The year saw 54 percent of the state's energy production coming from renewable sources, with nuclear making up the rest.

California's performance in the just over two years since its clean energy targets were signed into law has been mixed and raises questions about whether they could be missed.

The state is unquestionably undergoing a green energy revolution, with solar and wind production aiming to turn the Mojave Desert into the biggest renewable energy hub in the world. In April, California achieved a significant milestone when renewable energy supplied 100 percent of its power for between 15 minutes and six hours over 30 out of 38 days, a first for the state.

Newsweek illustration. California is undergoing a green energy revolution. Newsweek

However, California's desire to decarbonize its electricity grid has at times clashed with the state's notoriously stringent regulations, with a number of experts calling for red tape to be slashed in order to hit Governor Newsom's targets.

Newsweek has contacted Newsom's office via an online inquiry form.

The state has also faced what Phillippe Phanivong, of the Energy and Resources Group at the University of California, Berkeley, told Newsweek were the "challenges" coming from "aging infrastructure, rising new demand and climate change-fueled natural disasters."

There is also the question of cost with California residents paying more for their energy than any other state in the Union, with the exception of Hawaii, though to what extent this is the result of the state's green agenda is hotly disputed.

Red Tape and High Costs

In an article published in October by the San Luis Obispo Tribune, Laura Deehan and Nicholas Josefowitz, from the Environment California campaign group, singled out the regulations for installing rooftop solar and storage systems in the state.

The activists said these face "cumbersome approval processes" with "slow permitting and inspection, slow homeowner association approvals and slow utility interconnection and approval."

A 2022 report by the California Solar & Storage Association, a business grouping that boasts 700 member companies, concluded this was adding thousands of dollars to the installation of solar in the state, with the approval process sometimes costing more than the panels themselves. Partly as a result of this, it said the cost of a rooftop solar system in California is around double what it would cost in Europe.

Deehan and Josefowitz also said that in 2023, California cut utility bill credits to families sending surplus energy they produced through solar to the state grid by more than 70 percent, which they argued was behind a dramatic drop in the number of private solar installations.

In an interview with Newsweek, Mark Specht, the western states energy manager at the nonprofit Union of Concerned Scientists, said there is a "growing recognition that it's taking too long to build desperately needed clean energy infrastructure" in California.

While insisting there is "no silver bullet," he said: "Building transmission, connecting to the grid, and permitting new infrastructure projects are all processes with room for improvement that we expect to see taken up next legislative session."

Kevin Lyons, an associate professor of supply chain management at Rutgers Business School in New Brunswick, told Newsweek building a resilient energy infrastructure is key to solving what he called the "challenges that California faces."

California needs a "rock-solid and dynamic regional and local supply chain network" to complete this effort, Lyons added.

Extreme Weather Threatens Grid

Creating a clean energy supply in California requires dealing with the state's varied and sometimes tough climate.

In total, nearly 61 percent of major outages in the Golden State between 2000 and 2023 were due to "extreme weather," according to nonprofit research group Climate Central. Such outages are defined as those affecting at least 50,000 homes or businesses, or causing at least a 300-megawatt loss of power.

California's largest single electric utility company is Pacific Gas and Electric Company (PG&E), with spokesperson Tamar Sarkissian telling Axios that 2023 was the "most impactful year on record" for energy-related outages. Newsweek has contacted PG&E by phone.

Wildfires, which can be sparked by electricity lines, have increased across the nation with a recently published report in the peer-reviewed journal Science Advances concluding they have been "up to four times the size, triple the frequency, and more widespread in the 2000s than in the previous two decades."

Phanivong told Newsweek that as California's grid "has aged," natural disasters "have gotten worse," creating a dual pressure on energy supply in the state and thus complicating efforts to slash carbon emissions.

From 2019 to 2023, the California Public Utilities Commission (CPUC) authorized $27 billion to be collected from ratepayers in wildfire prevention and insurance costs, according to a report provided to the state legislature, and this figure is expected to rise faster than inflation through 2027. Newsweek has contacted the CPUC via email.

Battery Storage Issues

California has also been struggling to store all the energy produced by renewable sources, with battery capacity failing to keep up with production resulting in the state taking dramatic measures to avoid grid overload.

A Los Angeles Times investigation found that California produced a surplus from solar alone of more than 3 million megawatt-hours over the past 12 months, enough to power 518,000 homes in the state and an eightfold rise on the 2017 level.

As a result California has been sending energy to neighboring states to prevent grid overflow, at times even paying them to take it in a project that former Western Power Trading Forum executive director Gary Ackerman explained is "being underwritten by California ratepayers."

Professor Mark Jacobson, director of Stanford University's Atmosphere and Energy program, told Newsweek that in 2024 alone the amount of solar energy "wasted" in California would be enough "to eliminate the need for one-fourth of the 2,200 MW Diablo Canyon nuclear facility" in the state.

To solve this problem, Jacobson called for "increasing the quantity of batteries on the grid" and also suggested surplus electricity could be converted "to low-temperature heat that is stored in water tanks or soil for heat use in buildings."

In a statement provided to Newsweek, the California Independent System Operator, a nonprofit that oversees the state's electrical power system, said that due to the renewable "transition" the state "does, in the near term, have a surplus of renewable resources during certain times of the day and year."

However, it added that California is "aggressively adding battery storage to the grid" and argued surplus green energy produced by the state "has the added benefit" of cutting greenhouse gas emissions across the wider western United States as it is transferred to neighboring states.

Speaking to Newsweek, Jim Mathers, CEO of Florida-based consultancy Energy Professionals, argued the proliferation of AI data centers and electric vehicles means energy demand in California is set to increase sharply, while already outstripping supply at the national level.

He said: "Due to the massive increase in load requirements around the country due to electric vehicles, AI data centers coming on line requiring 100 times the energy needed for existing data centers, and the overall electrification demands created by the number of everyday electric appliances, the U.S. as a whole is looking at a lack of generation to handle the peak loads across the country."

In response, Mathers said an "onerous investment in energy storage is necessary to stabilize" the California grid, which will "will be a serious obstacle for Governor Newsom to reach his goal of 60 percent renewable energy by 2030."

Price of Going Green

At 34.31 cents per kilowatt-hour, California has the highest energy costs in the continental U.S. according to Statista, with residents of neighboring Oregon, Nevada and Arizona only paying 15 cents, 13 cents and 12 cents respectively.

According to one estimate published by Politico, utility bills in the Golden State have increased by 127 percent over the past decade, with climate spending, including both paying for renewables and containing the wildfire risk while boosting transmission capacity, deemed "partly to blame."

Speaking to Politico in February, Matt Baker, director of the California Public Utilities Commission's Public Advocates Office, admitted that "high rates can threaten the energy transition."

He added: "The energy transition depends on public support, and we have to do whatever we can to maintain that public support. That means doing it in the least-cost manner."

However, Professor Jacobson told Newsweek that "although California has the second highest electricity prices in the U.S. and high penetrations of renewable electricity, the two facts are only a correlation, not a cause and effect."

He added: "Of the 12 U.S. states with the highest WWS (wind-water-solar) supply as a percent of demand from October 1, 2023 to September 30, 2024, six were among the 10 states with the lowest residential electricity prices in March 2024; 10 were among the 20 states with the lowest electricity prices; and only two (California and Maine) had high electricity prices."

Instead, Jacobson attributed California's high electricity prices to utilities having "passed on to customers the cost of wildfires," including the burying of transition lines to reduce wildfire risk, along with payouts over the San Bruno and Aliso Canyon gas disasters and the cost of keeping the aging Diablo Canyon nuclear power plant open. He also said California's industrial price of fossil gas is the third highest in the U.S., and "more than twice an average U.S. price."

Specht, from the Union of Concerned Scientists, argued California is making progress in storing surplus energy which should eventually reduce costs, and given the threat from climate change can't afford not to take action.

He said: "California is leading the nation in shifting from a dirty, extractive economy to a clean, equitable one. While renewable energy curtailment has been on the rise, it's largely driven by insufficient transmission to deliver power, not oversupply, and isn't necessarily a sign of a big problem."

Specht concluded: "While there will always be some bumps in the road, the biggest mistake we could make right now is not moving as fast as we can to address rapid climate change...We cannot afford to slow down at this pivotal moment in history."