A fixation on renewables and underinvestment in nuclear and other dispatchable sources of electricity are causing economic pain in the state
"California’s politicians and policy makers eagerly emulated Europe’s energy policies for years. Like Europe, California overinvested in renewables, underinvested in hydrocarbons, prematurely shuttered its baseload power plants, and relied too heavily on imported energy. Now, as Europe is ensnared in Vladimir Putin’s energy trap, Californians watch as the state’s energy prices head toward the stratosphere.
On Feb. 25, the day after Russia invaded Ukraine, the Energy Information Administration reported that the all-sector price of electricity in California jumped by 9.8% last year to 19.76 cents per kilowatt-hour. Residential prices increased even more, jumping 11.7% to an average of 22.85 cents per kilowatt-hour. California residential users are now paying about 66% more for electricity than homeowners in the rest of the U.S., who pay an average of 13.72 cents per kilowatt-hour.
California’s rates are rising far faster than those in the rest of the country. Last year, California’s all-sector electricity prices increased 1.7 times as fast as the rest of the U.S., and residential prices grew 2.7 times as fast as in the rest of the country.
What should be done? California’s political leaders need big doses of energy realism and energy humanism. Gov. Gavin Newsom should act immediately to prevent the closing of the Diablo Canyon nuclear plant and begin pushing for the rapid deployment of new nuclear plants, including small modular reactors. He should also commission a study to determine the total cost of the state’s climate goals and implement measures that will allow California to produce more of the energy it needs, including oil and natural gas."