California ISO approves PG&E plan to replace old power plant

Pacific Gas and Electric Co. won approval from the California Independent System Operator (California ISO) to provide a clean alternative to a decades-old fossil-fuel power plant in Oakland.

PG&E‘s Oakland Clean Energy Initiative (OCEI) will use local clean-energy resources, including energy storage, energy efficiency and electric-system upgrades, to ensure transmission grid reliability in Oakland when the current power plant at 50 Martin Luther King Jr. Way is retired.

PG&E will open a two-month request-for-offers process this spring to invite providers of distributed energy resources to propose solutions for the portfolio.

The system operator has a Reliability Must Run contract with the existing plant’s owner, Dynegy, to purchase power during peak periods. In spring 2017, the system operator identified the 40-year-old plant’s eventual retirement as a risk to local transmission reliability, and said it would consider alternatives including new transmission lines through heavily populated areas of Oakland, a new fossil-fuel plant or a portfolio of local clean resources.

PG&E and the system operator worked collaboratively over the last several transmission-planning cycles to study how distributed clean energy resources could become part of the solution, Kuga said.

The system operator determined in its transmission plan that the OCEI would be a clean and affordable option to new transmission or a new fossil-fuel facility.

With the system operator’s decision, PG&E will move forward to upgrade existing substations and develop new clean-energy resources in Oakland to provide an alternative to the generating facility.

The OCEI would mark the first time that local clean-energy resources are proactively deployed as an alternative to fossil-fuel generation for transmission reliability in PG&E’s service area.

PG&E will continue to collaborate with community choice aggregator East Bay Community Energy to determine and meet the clean-energy and reliability needs of local customers.

Depending on the exact resource mix, the market solicitation is expected to result in 20 to 45 megawatts of clean energy resources.

PG&E invited multiple stakeholders to weigh in on the proposal, including the city of Oakland; the International Brotherhood of Electric Workers Local 1245; the Port of Oakland; environmental groups such as the Environmental Defense Fund, the West Oakland Environmental Indicators Project and the Natural Resources Defense Council; and businesses that neighbor the site.

PG&E will seek cost recovery for the battery storage with the Federal Energy Regulatory Commission, and for other distributed energy resources with the California Public Utilities Commission. PG&E expects to make its filing with the state commission by the end of 2018. The Oakland Clean Energy Initiative has a forecasted in-service date of mid-2022.

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The Clarion Energy Content Team is made up of editors from various publications, including POWERGRID International, Power Engineering, Renewable Energy World, Hydro Review, Smart Energy International, and Power Engineering International. Contact the content lead for this publication at

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