A growing number of Californians ditching utility companies for alternative power sources are pushing the state to the brink of a second energy crisis, regulators warn.
California prides itself as a national leader when it comes to alternative energy production and distribution. The state implements a broad array of “environmentally friendly” programs for electricity consumers. Net metering, community choice aggregation (CCA), and Direct Access are among the top choices. These programs have proven attractive with a populace wishing to buck the state’s investor-owned utilities. They are expected to account for about 25 percent of California’s entire retail electric load this year and, based on projections, reach 85 percent by the mid-2020s.
However, such rapid changes don’t come without consequences.
Electric utilities, uncertain of how many customers they will have in the future, are becoming more hesitant to sign long-term contracts with power generators. Even natural gas producers — which have proliferated in the U.S. in recent years — are struggling to churn a profit in the volatile California market.
California Public Utilities Commission President Michael Picker is now warning that the state may be at risk of an energy crises. Customers may soon be subjected to skyrocketing electricity prices, rolling blackouts and other problems — unless the state plans accordingly. Picker’s office released a report Thursday detailing how state leaders can reform the electricity market and avoid an energy shortage.
“We have a hodgepodge of different providers,” Picker stated in an Thursday interview with Bloomberg. “If we aren’t careful, we could slide back to the kind of crisis we faced in 2000 and 2001.”
Picker referenced the unprecedented energy crises California faced nearly two decades ago. Following market deregulations, price caps and continual delays with new power plant approvals, the state experienced widespread blackouts. Hundreds of thousands of homes were plunged into darkness between 2000 and 2001. The political fallout tattered then Gov. Gray Davis’ standing, becoming the second governor in U.S. history to be successfully recalled.
Nearly finished with his second consecutive term, current Gov. Jerry Brown has overseen a vast change in California’s energy sector. The Democratic executive has positioned himself as a champion of environmental issues and a major foil to the Trump administration’s deregulation agenda. Most notably, Brown pushed legislation that makes California’s renewable portfolio standard reach 33 percent by 2020 and 50 percent by 2030.
Such targets have been praised by environmentalists, but others question their practicality.
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