Los Angeles hits pause on $2.2B gas plant investment plan

Dive Brief:

  • The Los Angeles Department of Water and Power will reconsider a $2.2 billion natural gas investment plan, instead signaling that the largest publicly-owned utility in the country will first look to renewable resources to meet demand.
  • In a presentation yesterday, the Board of Water and Power Commissioners indicated it "has put on hold all planned local repowering projects until a system-wide, in-depth, and independent study/analysis is conducted."
  • The Los Angeles Times notes that the decision comes after the newspaper's February investigation of the state's generation resources, concluding that customers were being charged to construct unnecessary power plants. 

Dive Insight:

The Times' investigation earlier this year concluded that California ratepayers were footing a bill almost $7 billion higher than they had in 2008, when the state's power demand peaked. Now, environmental advocates are hailing LADWP's decision as a "get serious" moment.

Los Angeles is in the process of overhauling 70% of its generation mix, according to Sierra Club. The decision to "press pause on building gas plants is a sign that the utility is getting serious about eliminating dirty gas from the energy mix," the group said in a statement.

The utility had budgeted more than $60 million in the 2017-18 Fiscal Year to complete demolition projects at Scattergood and Haynes Generating Stations and prepare the sites for "repowering" projects. The Times reported the broader plan to rebuild several gas plants would cost more than $2 billion.

Amanda Parsons, a spokesman for LADWP, told City News Service that the "we just want to study all of our options at hand so that we make sure we have the best data that we possibly can have and the best information before moving forward."

The utility made its decision as state lawmakers consider ramping up renewable energy goals. The California Senate passed a measure to mandate 100% renewable energy by 2045. The bill now moves to the state Assembly.

SB 100 would target 50% renewable energy by the end of 2026 and 60% renewables by the end of 2030. The state currently has a 50% renewable energy target set for 2030, and sourced 27% of its power from renewables last year. 

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Filed Under: Generation Solar & Renewables
Top image credit: Wikipedia