As the rest of the country rushes to build natural gas power plants, California continues to downsize its fleet. While the official numbers are not yet in, 2018 appears to have been a big year for natural gas power plant retirements in California.
California saw three big plant retirements last year: Encina (854 MW), Mandalay (560 MW), and Etiwanda (640 MW). The retirement of Encina and Mandalay was no surprise – those two plants used ocean water for cooling, and California has been phasing out plants that use that cooling technology because of its harmful effects on marine life. On the other hand, Etiwanda shut down simply because it was not making enough money. While California has figured out solutions to keep the electric grid operating reliably without the Mandalay and Etiwanda power plants, Encina is being replaced by the Carlsbad Energy Center, a new 500 MW natural gas power plant.
A dwindling fleet
These retirements in 2018 continue California’s downward trend in natural gas power plant capacity. California’s gas fleet peaked in 2013 with just over 47,000 MW of gas capacity, but California has shed roughly 5,000 MW of gas capacity since then.
Source: California Energy Commission
California’s gas fleet is shrinking because many natural gas power plants just cannot make enough money to stay open. Since 2012, California has added roughly 20,000 MW of wind and solar to the grid, and these renewables are generating electricity that otherwise would have been generated by natural gas power plants. Since there is less demand for electricity from gas plants, some plants are shutting down for good.
More retirements to come
Looking forward, California is expecting many more retirements in the years to come. Another 1,380 MW of natural gas power plant capacity is expected to be retired in 2019, and another 4,600 MW of gas capacity is expected to be retired in 2020.
Will these retired gas plants be replaced by brand new gas plants? It’s not looking likely. There are only a couple thousand megawatts of new natural gas power plants under construction in California. In addition, Los Angeles recently decided not to rebuild a couple of outdated natural gas power plants, opting to invest in renewables and storage instead. California’s gas fleet is poised to continue its decline over the next few years.
At the end of the day, these retirements are not unexpected. Recent analysis from the Union of Concerned Scientists has shown that California can retire a significant amount of natural gas power plant capacity while continuing reliable operation of the electric grid. Nevertheless, this is good news as California adopts increasingly ambitious global warming emissions reduction goals. California is continuing to head in the right direction – as the state adds more and more wind and solar to the grid, California’s electricity sector is gradually weaning itself off fossil fuels, downsizing its gas fleet one plant at a time.