HOW SDG&E SEES ENERGY’S FUTURE
A just and equitable energy transition aligned with California and local climate goals isn’t just about getting to a clean energy future as quickly as we can. It also requires prioritizing customers, energy affordability and grid reliability.
This vision drove San Diego Gas & Electric’s year-long study to identify an optimal path to decarbonize our economy by 2045 and meet California’s aggressive climate goals. For “The Path to Net Zero: A Decarbonization Roadmap for California,” SDG&E asked leading climate experts, including UC San Diego professor David Victor, to conduct a rigorous analysis of what’s needed to enable the clean energy transition.
SDG&E’s study does more than propose building new infrastructure. It takes a hard look at the complex challenge of decarbonizing California’s economy by 2045 and offers a road map for success. There’s plenty of work to do, and one thing is clear: Our future depends on unprecedented collaboration.
The study underscores the role of consumers, who must be able to access energy efficiency and conservation programs and adopt new technologies like electric vehicles, rooftop solar and battery storage. Consumer choices and behavior, like when electric vehicles are charged, will shape infrastructure needs.
The study validates that transforming transportation and buildings to run on energy produced from renewable resources like solar and wind is foundational to achieving carbon neutrality. For example, the share of electrified residential and commercial water heating must grow to at least 96 percent over the next two decades. That’s why SDG&E supports local governments that choose to enact policies requiring most new buildings to only use electricity. Electrifying new buildings now avoids expensive retrofits in the future.
Additional electrification will naturally require much more electricity and a more robust grid. According to our study, electric generation capacity would need to increase to about four times that of 2020 to meet anticipated demand from electric vehicles and buildings. As businesses and families depend more on electricity to meet their energy needs, building a state-of-theart, reliable and climate resilient grid is imperative.
The volume of renewable energy required in California to reach carbon neutrality by 2045 is astounding. Our study indicates that starting in 2023, the average amount of solar installed annually across the state must increase 700 percent over the current pace of deployment. Likewise, battery storage, wind energy and other clean technologies critical to a reliable and clean grid must also grow exponentially over the coming decades. We’re committed to working with renewable energy developers, community choice aggregators like San Diego Community Power and municipal partners to meet these targets.
Our study also confirms that carbon neutrality and grid reliability cannot occur with renewables and batteries alone. Clean fuels like green hydrogen will be needed for certain hard to electrify sectors of the economy such as heavy-duty trucking and some industrial processes. SDG&E has launched innovative green hydrogen pilot projects to learn how to leverage this zeroemission technology to replace natural gas in power plants, pipelines and to power fleet vehicles.
The road map for decarbonizing California’s economy informs regional strategies. In San Diego, transportation remains the single biggest source of emissions, which is why putting more zero-emission cars and trucks on our roads is already a regional priority.
Transitioning existing buildings from natural gas to using electricity requires similar collaboration and thoughtful planning. Given the transition to electrification is a multi-decade process, investment in the safety of the gas system must remain a priority. We must also ensure the thousands of highly skilled union men and women who work on the gas system are protected. Frankly, we see tremendous opportunity for this critical workforce as hydrogen and other clean fuels are developed as part of an overall clean energy system.
Finally, decarbonization must happen with affordability in mind. Programs, incentives and policies — including energy rate reform to ensure the clean energy transition is affordable — must be developed to help 900,000 SDG&E gas customers begin switching to electric appliances. We see broad alignment here with climate-focused organizations that are reflexively critical of everything proposed by SDG&E even when we largely share similar goals and outcomes on climate change.
We know we don’t have all the answers and can’t do this alone. We believe we are stronger together. Our 4,600 employees, who also live and work here, stand ready to accelerate the clean energy transition. This is an open invitation to collaborate on ideas and plans, to push to electrify buildings and transportation through alliances with local governments, customers, community-based organizations and labor. Only by working together can we build momentum toward economy-wide decarbonization by 2045 — a safer, stronger, and healthier future.