CPUC Final Decision: AES Redondo not required

On March 14th, the CPUC issued its final decision on new long term power contracts to replace the generating capacity of ocean cooled power plants and the San Onofre Nuclear Generation Station (SONGS).  This decision addresses the need for new power generation capacity through 2022 and beyond taking into account projected power needs, the permanent retirement of SONGS, and the phase out of power plants that use ocean water cooling.  Long term contracts are needed to provide power plant developers and operators the assurance that there will be a return on the investment of building a new power plant.

For the LA Basin, our portion of the grid, the CPUC authorized Southern California Edison to let long term contracts for between 1000 MW and 1500 MW of new natural gas power.  This is a bit higher than the preliminary decision, but far below AES' applications to build 3300 MW of new natural gas powered capacity:  900MW at Huntington Beach, 1900 MW at Alamitos, and 500MW in Redondo.   Even if AES were to win all the contracts for new capacity, those contracts would cover less than half of the capacity AES has applied to build.   

The CPUC decision further biases against rebuilding at Redondo by placing strict constraints on SCE's proposed contracts.  SCE must demonstrate that their planned contracts are cost efficient and must include the following:

"The consideration of costs and benefits must be adjusted by their relative effectiveness factor at meeting the California ISO identified constraint.", and;

 "Provisions designed to minimize costs to ratepayers by procuring the most cost-effective resources consistent with a least cost/best fit analysis...."

With SONGS offline permanently our biggest needs are at the Orange County border.  So these requirements mean that SCE must weigh Huntington Beach and Alamitos over Redondo as they are more efficient and effective at providing the power where it is needed. 

The handwriting is on the wall.  It is time for AES to stop wasting everyone's time and money.  It is time to drop the charade of building a power plant in Redondo and come to the table to discuss what can be done with their property that is mutually beneficial.  And it is time for our city to consider the best integrated mix of uses across the harbor AND the AES property, rather than looking at them as two, discrete and totally separate developments.