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Edison International Helps Power California’s Leadership in Countdown to Meet Global Climate Goals

By, Pedro J. Pizarro president and CEO, Edison International

Pedro J. Pizarro, president and CEO of Edison International and chair of the Edison Electric Institute, will head to the United Arab Emirates for the COP28 Climate Change Conference with a sense of urgency. His company, along with its subsidiaries, electric utility Southern California Edison and energy and sustainability advisory Edison Energy, are working to revolutionize the way customers power their homes, vehicles and businesses. SCE serves 15 million people across a 50,000-square-mile service area while Edison Energy serves clients around the world, including more than one-quarter of the Fortune 100.

Edison International recently published a groundbreaking analysis of what will be required for California to affordably and quickly reduce greenhouse gas emissions and reach net zero by 2045. As climate change creates escalating risks to health and livelihoods for people worldwide, California’s actions can serve as a model for other states and nations.

In this interview, Pizarro previews the messages he and his team will share in Dubai.

What does Edison International hope to accomplish at COP28?

We want to continue to spread the message about the increasingly urgent need to address climate change by decarbonizing and transforming our economies with clean energy and electrification. In California, we have already seen the harm caused by climate change. As the world’s fifth-largest economy, our state can demonstrate through global leadership that the transition to clean energy can be done safely, reliably and affordably.

One way we can do that is by sharing the results of an important study Edison International recently completed called Countdown to 2045. It demonstrates the speed that is needed and outlines a pathway to follow to meet California’s mandated target of net-zero greenhouse gas emissions in less than 22 years. Countdown lays out a clear picture of how to build out needed infrastructure, decarbonize the electric grid, electrify buildings and transportation, use low-carbon fuels for hard-to-electrify sectors and deploy emerging technologies to capture the remaining carbon.

We must keep up the pace and push for unprecedented levels of innovation and collaboration across planning, policy and technology.


What will a more fully electrified California economy look like?


In some ways, not that different from the way it looks today — but the air will be fresher, noise from gas-powered vehicles will be diminished and our home kitchens will not be emitting harmful pollutants. We’re still going to have lots of cars and trucks, air-conditioned buildings, and ships loading and unloading cargo containers from all over the world. But instead of being powered by gasoline, natural gas and diesel, they will run on clean electricity. To meet California’s 2045 goals, 90% of light- and medium-duty vehicles will need to run on electricity and more than 50% of heavy-duty vehicles will need to be electric. Last year, those percentages were at about 3% for cars and less than 1% for heavy trucks, so there is a lot of work to do.

We project 95% of the appliances in residential and commercial buildings will run on electricity, compared to about 13% in 2022. Together, transportation, building and other forms of electrification will boost the demand for electricity by more than 80% by 2045.


It’s encouraging to note that consumers and businesses are getting on board. Electric water and space heaters outsold natural gas appliances in the U.S. for the first time last year. In California, sales of zero-emission, light-duty vehicles rose from less than 7% in 2019 to about 27% in the third quarter of this year. In Southern California, terminal operators at our world-class Port of Long Beach are rapidly replacing diesel-powered yard tractors, forklifts and other vehicles with electrified equipment.



It’s encouraging to note that consumers and businesses are getting on board. Electric water and space heaters outsold natural gas appliances in the U.S. for the first time last year. In California, sales of zero-emission, light-duty vehicles rose from less than 7% in 2019 to about 27% in the third quarter of this year. In Southern California, terminal operators at our world-class Port of Long Beach are rapidly replacing diesel-powered yard tractors, forklifts and other vehicles with electrified equipment.

How are you going to solve the problem of getting this electricity to the businesses and consumers who need it?

In the simplest terms, our electric grid must grow like never before. We project that new transmission and distribution projects need to be built at up to four and 10 times their historical rates, respectively. To connect new clean generation projects such as wind, solar and geothermal, we’re going to need about 20,000 miles (32,000 kilometers) of additional high-capacity transmission lines in California alone. Visualize those lines end to end and they would stretch around 80% of our planet at the equator — that’s longer than Los Angeles to Dubai and back!

The Eldorado-Lugo 500 kV transmission lines bring power from the Hoover Dam to Victorville, Calif. PHOTO CREDIT: Casey Wian

SCE will need to build the equivalent of 85 new distribution substations and upgrade another 350 to expand their capacity. We also need enough utility-scale battery storage to power 15 million homes. The U.S. electric power industry has reduced emissions by 36% over the last 18 years ― more than any other sector. We need to see more across all sectors, which is why expanding the grid is such an urgent priority.

How is California tackling decarbonization at a time when skepticism persists about the need to act quickly?

A lot of people expressed skepticism last year when California’s governor ordered the aggressive regulation to speed up the transition to EVs. We heard California residents asking, “How can you expect us to switch to EVs when we’re not confident that there is enough electricity to power through a sustained heat wave?” Questions like this come from, in large part, misinformation. Our mission includes better education of our customers, businesses, communities and the public at large, which we are doing.

The reality is that California hasn’t had a systemwide outage for three years. Last year, we experienced a heat dome across the western U.S. that strained the system and we saw the highest peak demand ever on the grid, but there were no systemwide outages here. That is partly thanks to the considerable amount of energy storage the state has added. Earlier this year, the California Independent System Operator surpassed 5,000 megawatts of energy storage. Three years ago, there were less than 500 megawatts.

We’re also helping residential and business customers understand the benefits of electrification. SCE’s Foodservice Technology Center, for example, provides customers the opportunity to borrow a table-top induction range for free for up to two weeks. Cooks quickly appreciate the precise temperature control induction cooktops deliver while we help them understand they are more efficient, less polluting and safer compared to other technologies.

On the commercial side, Edison Energy is helping companies better understand the business case for an energy storage system or how sustainability efforts must extend beyond direct operations, for example.

What are some of the challenges you’re facing?

One of the largest hurdles we need to overcome isn’t as exciting as developing new technologies, but it’s still critically important. Right now, a brand-new transmission project in California takes an average of 10 to 12 years to complete. Some can take even longer. Permitting alone can take two to four years. Inefficient and redundant processes create bottlenecks that are clearly inconsistent with the speed we need to build an enhanced grid to accommodate increased electrification.

Eliminating redundant efforts, minimizing handoffs and limiting permitting review timelines would go a long way toward speeding up the process. The regulations and red tape that developed over decades are out of step with the speed of deployment now required to address climate change.

The biggest development needed right now is with emerging technologies like offshore wind, geothermal, nuclear and carbon capture and storage. We can’t predict which technologies will prove to be the most affordable at scale, so it is critical that policymakers and regulators allow for optionality so the market can adopt the most efficient and cost-effective solutions in the future.

The costs of the clean energy transition appear staggering. What type of investment is required? Where will this money come from?

You’re right. In California, Countdown forecasts that about $120 billion in new grid infrastructure will need to be built over the next two decades to meet our state’s net-zero goal. The expansion of new power supplies and storage from solar, batteries, offshore wind and other clean resources will add about $250 billion more in incremental costs. We also don’t know exactly how much we’ll need to spend on new technologies to remove the last remaining emissions from our economy.

But here’s what we do know. Countdown estimates the average residential customer’s spending on all forms of energy will be 40% lower in 2045 than it is today. Yes, electric bills will be higher, but that will be more than offset by lower spending on gasoline for your car and natural gas for home heating. Electric technologies are much more efficient than their fossil-fueled equivalent, where much of the work is lost to heat.

Fortunately, state and federal governments are beginning to provide more help. Last year, the Inflation Reduction Act became law and will allocate nearly $400 billion for tax incentives, grants and loan guarantees to encourage investment in emerging clean technologies. It also offers incentives that encourage consumers to switch to EVs, heat pumps, solar panels and home battery systems.

The clean energy revolution will only prevail and endure if it is affordable and reliable. That’s true in California and for our global partners in this critical effort.

 

About Pedro J. Pizarro

Pedro Pizarro is president and CEO as well as a director of Edison International, the parent company of electric utility Southern California Edison and global energy advisor Edison Energy. Previously, Pizarro was president of Edison Mission Energy, an independent power producer subsidiary, and became president of SCE in October 2014. Pizarro was formerly a senior engagement manager with McKinsey & Company. He earned a Ph.D. in chemistry from Caltech and a bachelor’s degree in chemistry from Harvard. Pizarro is chair of the Edison Electric Institute, co-chair of the Electricity Subsector Coordinating Council and a board member of Caltech and 3M.







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