Action for an RTO
The state Legislature unanimously passed a resolution last year, ACR 188, requesting a comprehensive assessment of how a regional transmission organization (RTO) could help California achieve its energy and environmental goals.
In February 2023, California’s grid manager – the California Independent System Operator (CAISO) – released a report prepared by the National Renewable Energy Laboratory that provided a definitive conclusion: “California’s goals for renewable energy and greenhouse gas reduction can be achieved more quickly and with less cost to Californians through expanded regional cooperation.”
The ACR 188 report surveyed existing research on regionalization – finding a “consistent narrative” on the benefits of regional energy cooperation. These include:
- Cost savings, resource capacity savings, and emission reductions
- Greater transparency, increased stakeholder participation, and more efficient use of the transmission system
- Enhanced reliability, especially under stressful conditions that impact the availability of some generation and transmission assets
- Greater resource and load diversity from a geographically larger operational footprint
- Larger cost savings and grid flexibility from an RTO, over more limited forms of cooperation, due to its more comprehensive structure for cooperation.
The report cites one recent study that found an RTO of 11 western states would save Californians up to $563 million in annual energy bill savings, create 138,700 new high-paying jobs (averaging $91,000 in annual compensation), produce $21.7 billion in economic growth, and accelerate 470 megawatts of new clean energy construction (enough to power nearly 90,000 homes).
The report also concludes expanded regional energy cooperation is vital to maintaining the reliability of California’s energy system, with benefits including:
- Less curtailment of solar and wind resources due to congested transmission paths
- The ability to export excess wind and solar power elsewhere in the region when local production is high and demand is low
- More operational flexibility to manage the variation in solar and wind output
- Better grid resilience (the ability to mitigate or recover from extreme weather events and other major outages).
Read the full National Renewable Energy Laboratory report here.
