The second 20-Year Transmission Outlook (2024 Outlook), a planning exercise issued by the California Independent System Operator (CAISO) on July 31, identifies the transmission upgrades and additions needed to connect a projected 165 gigawatts (GW) of new resources that will be required to meet the state’s goal of relying on renewable and zero-carbon resources to supply 100% of retail electric sales by 2045.
California faces the difficult challenge of accommodating two of the state’s initiatives that are designed to significantly reduce emissions of greenhouse gases, including carbon dioxide, by 2045. To reduce the combustion of fossil fuels, the state is promoting the electrification of the transportation, building, and industrial sectors, resulting in rapidly increasing electricity demand in a state that has historically had relatively flat demand. At the same time, California is converting its generation fleet to renewable and other zero-carbon technologies, which requires replacing many existing generating resources that support the reliability of the current grid.
Based on forecasts developed in collaboration with the California Energy Commission and the California Public Utilities Commission, the 2024 Outlook projects a 2045 peak load of 77,430 megawatts (MW), more than 25,000 MW higher than the record peak load of 52,061 MW set in 2021. To meet this increased demand while moving toward a zero-carbon generation fleet, the 2024 Outlook maps out transmission additions needed to connect the projected 2045 resource base, which includes 20,000 MW of offshore wind generation, split between the North Coast (14,600 MW) and the Central Coast (5,400 MW) call areas. Transmission additions are identified for 58,000 MW of energy storage (including 5,000 MW to 9,000 MW of long-duration storage), 70,000 MW of utility-scale solar projects, 2,300 MW of geothermal generation, and 15,000 MW of in-state (3,000 MW) and out-of-state (12,000 MW) wind generation. Transmission plans for the 2045 resource mix must also account for the expected retirement of 15,000 MW of gas-fired power plants that are typically located in load centers.
Connecting these new resources to the grid will be costly. Unlike the CAISO’s annual Transmission Plan, the 2024 Outlook is a conceptual planning exercise that does not authorize specific projects. However, based on its 20-year projections, the 2024 Outlook estimates that the transmission upgrades and new transmission projects needed over the next 20 years will cost $45 billion to $63 billion. Of this total, $25 billion to $36.5 billion will go towards developing transmission infrastructure to export 20,000 MW of offshore wind from the North Coast and Central Coast to load centers. Integrating out-of-state wind resources into the CAISO system is estimated to cost $11.6 billion to $15.2 billion, part of which might be borne by participants outside of California. Additions and upgrades to the existing CAISO system will require $9.3 billion to $11.5 billion.
The CAISO intends to meet with stakeholders this year to discuss next steps and the long-term architecture described in the 2024 Outlook.
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