California’s power grid operator said this week the state will need to spend $9.3B over the next decade on grid upgrades to support its transition to renewable energy and electric vehicles.
In a draft transition plan, the California Independent System Operator identified 46 projects it says will be needed to help planned solar plants and offshore wind farms plug into the grid, as well as new transmission lines and other grid upgrades to help improve reliability in a state that already has been hit with blackouts.
The transmission plan is based on projections that California will need to add 40-70 GW of power generation over the next 10 years, depending on how quickly consumers switch to electric cars and electric home appliances; California’s highest-ever recorded power demand, set in September, was 52 GW.
Electricity prices in California jumped 15% in 2022 and have increased ~80% since 2008.
Utility stocks (NYSEARCA:XLU) have sold off since August, as rising interest rates have given investors alternatives for income, and many stocks in the sector are trading at double-digit discounts to historical valuations, Eric Landis writes in an analysis posted recently on Seeking Alpha.