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It takes time and extensive planning to build a new clean power plant in California. Figuring out how, where and when to generate clean electrons is a balance between ensuring that the energy transition is affordable, and that the state keeps the lights on.
California regulators recently issued a proposal that will do just that. There are a lot of things to like, but as with everything, getting the details right is essential to securing an affordable, reliable and clean energy future.
An Integrated Resource Planning (IRP) process is a recurring planning cycle that determines how California can meet future electricity needs. It evaluates electricity generation, transmission needs and demand forecasts to ensure the state can maintain reliability, control costs for ratepayers and reduce greenhouse gas emissions. The California Public Utilities Commission (CPUC) is the primary state agency that conducts this assessment. Recently, the CPUC released a new proposal through this process that has significant implications for the state’s clean energy transition.
Two major determinations are at stake. First, the CPUC outlines a portfolio of future electricity resources designed to achieve California’s climate goals without compromising grid reliability or imposing unnecessary costs on ratepayers. Once finalized, the assumptions will be handed to the state’s primary grid operator, the California Independent System Operator (CAISO), which will determine the transmission infrastructure needed to deliver this clean energy efficiently across the state. Second, the CPUC proposes directing electricity providers to procure additional clean energy to meet growing demand. Because building power plants is expensive, determining that the generation is truly needed is a critical step to keeping rates just and reasonable.
While the CPUC’s most recent proposal gets several things right, it also misses the mark on details that could significantly affect the reliability, affordability and pace of California’s clean energy transition.
To deliver new clean energy generation, California will require significant upgrades to the transmission system. However, building transmission infrastructure takes time. To plan ahead, the CPUC develops a “base portfolio” — a proposed future mix of energy resources designed to meet reliability needs while meeting California’s emission goals. The base portfolio is then handed off to CAISO, which analyzes what transmission upgrades are needed to deliver it.
Offshore wind is a crucial piece of the puzzle to help clean the grid in an affordable and reliable manner. As a clean firm resource, offshore wind can supply electricity continuously or adjust output to meet peak demand. When paired with other clean energy resources such as solar and storage, offshore wind can help fill reliability gaps and meet emission reduction targets without compromising electricity availability.
Recognizing its importance, the CEC set a goal of developing 25 GW of offshore wind by 2045, and as directed by AB 1373, the CPUC directed the state’s Department of Water Resources (DWR) to centrally procure up to 7.6 GW of offshore wind in 2024. Yet the recent proposal only plans for 4.5 GW of new offshore wind by 2045, split between Morro Bay and Humboldt. Regulators also assume that offshore wind project timelines will slip, leading the CPUC to advise CAISO to delay the transmission upgrades needed to deliver power from the Humboldt site until 2036.
The CPUC points to recent federal uncertainty as the catalyst for these delays. Over the past year, the offshore wind industry has faced significant barriers, including five federal stop-work orders issued on East Coast projects in December based on ambiguous national security claims. Recent court decisions, however, have rejected the Trump administration’s flimsy assertions, greenlighting construction to resume in all five cases and helping restore industry confidence.
California’s energy transition should not be slowed down or negatively shaped by tenuous federal claims and uncertainty. Instead, the state should be a national leader on offshore wind development. Ratepayers will be best served by reducing risk and uncertainty, and being very clear about the state’s long-term planning timelines despite short-term political volatility is a critical step. Limiting the ceiling for offshore wind capacity now would send mixed signals to developers and undermine the industry’s ability to achieve economies of scale that could ultimately lower costs for ratepayers.
For the first time in a generation, California’s electricity demand is growing. According to the California Energy Commission (CEC), peak electricity demand is expected to increase by 53% by 2045. The surge is driven largely by data centers, building electrification and transportation electrification. Together, these trends mean California will need more electricity than previously modeled. To support this expanding electrified economy, electricity rates must remain both affordable and reliable.
The state is attempting to meet the moment. Recognizing growing risks to grid reliability and the potential for future blackouts, the CPUC is proposing that electricity providers procure additional clean power. The CPUC recommends buying 2,000 MW of capacity by 2030, followed by another 4,000 MW by 2032. That’s enough electricity to deliver power to 4 million Californian households during peak demand.
To encourage a mix of resources, the CPUC proposes limiting batteries, or short-duration electric energy storage, to no more than half of the new clean resources. Batteries are increasingly cost-effective and essential for balancing the grid, but they can only store energy for short periods and depend on sufficient generation to charge. Without adequate clean generation, the grid risks supply shortages during extreme weather events. Applying a storage limit across both tranches is critical to maintaining system stability as electricity demand continues to rise.
The IRP considers both statewide planning needs and local system constraints. While the CPUC proposes maintaining a greenhouse gas reduction target of 25 MMT by 2035, they must also ensure that local air quality pollution is eliminated. In areas with limited infrastructure to import power, dirty gas-fired plants often ramp up during peak demand, increasing emissions and threatening public health in these communities.
While a comprehensive local procurement planning process is eventually needed to fully retire gas plants, implementing a modest clean energy procurement requirement in the most overburdened communities would be a meaningful first step. This approach would allow the state to evaluate long-term solutions that reduce reliance on local gas dependence while improving air quality in affected areas.
It’s important to acknowledge that this proposal is just that — a proposal. While there is a lot to like, including clear signals for power and storage procurement and assumptions to upgrade our transmission grid, the success of the process will depend on getting the details right.
California has a real opportunity to lead boldly in the clean energy transition by accelerating clean firm power resources, like offshore wind, to build a grid capable of meeting the moment. Proactive leadership today can diminish reliance on fossil generation, reduce harmful pollution in vulnerable communities and help keep the grid affordable for all Californians.
One of the most harmful actions the Trump EPA took during its first term was undermining long-standing Clean Air Act safeguards that require industrial facilities like refineries and power plants to modernize their pollution controls when they are newly built or expanding in a way that increases overall pollution volumes. These protections are intended to ensure newly constructed facilities or refurbishing existing industrial facilities are good neighbors and install the best available pollution controls to mitigate the harms when their industrial activities are increasing pollution in our communities.
The Trump EPA granted polluters a long-sought pass that allowed facilities to evade these New Source Review protections – without the public or regulators even knowing that pollution-increasing projects were taking place.
Last November, EDF, Natural Resources Defense Council (NRDC) and the Sierra Club filed a brief in court challenging the Trump EPA’s adoption of this damaging policy, which is known as Project Emissions Accounting. The Trump EPA filed its brief this week.
Project Emissions Accounting allows industry to manipulate emissions calculations to avoid triggering requirements that would protect local air quality against large pollution increases.
Here are some more things you should know:
New Source Review is an essential safeguard for local air quality
For decades, New Source Review safeguards have applied whenever an industrial plant makes a change that increases its pollution. To ensure this excess pollution doesn’t compromise local air quality, New Source Review provides protections that include:
Project Emissions Accounting — an industry free pass to pollute
The Trump EPA’s “project emissions accounting” policy creates new loopholes that effectively grant industry near limitless ability to increase pollution significantly — like by building new power plants — without going through New Source Review.
Here’s how it works:
Sometimes existing plants make changes that result in both pollution increases and pollution decreases. For example, a manufacturing plant might increase production of a certain product, increasing its pollution, but at the same time cut production of another product line, decreasing its pollution from that process.
Previously, a plant could count these pollution decreases against the pollution increases to avoid being subject to New Source Review – but ONLY with certain conditions to ensure that the decreases were real, enforceable, and happened before the pollution increases. The Trump EPA did away with these critical safeguards.
Under the Trump EPA’s policy, facilities can avoid New Source Review by counting pollution decreases that are speculative, are not permanent, and are not projected to occur until years into the future. That means communities will suffer rises in noxious emissions with none of the protections of New Source Review.
No transparency about significant increases in air pollution
Sources that use Project Emissions Accounting to avoid New Source Review may still be subject to state permitting requirements, but this review is often insufficient to provide meaningful protection. The federal rules governing such programs are weak. They largely delegate to the states to determine how protective review of minor sources should be, and those requirements can vary widely from state to state.
Alarmingly, there is no requirement for sources to disclose when they have used Project Emissions Accounting to avoid New Source Review. Federal and state regulators themselves have no way of tracking which sources have decided they do not need to go through the full process. Facilities are not required to document or report their emissions decreases. The Trump EPA plan is based on industry self-regulation with no oversight.
The Biden administration had proposed adding guardrails to the use of Project Emissions Accounting – including requiring that emissions decreases be enforceable, and adding recordkeeping, reporting and monitoring requirements. That proposal was not finalized though, and the Trump administration last summer withdrew the proposal with little explanation.
Exploitation of a loophole for new gas power plants
The Trump administration adopted its policy in 2018 and formalized it in rulemaking in 2020. Since then, sources across the country have used it to evade New Source Review.
While we have no way of knowing exactly how widespread the use of Project Emissions Accounting is due to the lack of transparency, what we have found suggests a deeply alarming and inappropriate reliance on this policy to avoid New Source Review for large new sources of pollution.
One particularly egregious use is by some power companies that operate aging coal plants that they plan to retire. In certain cases, owners of these plants have avoided New Source Review for the construction of new gas power plants by siting them near the existing coal plants they had already planned to shut down – and claiming that pollution from the new gas plants, like dangerous nitrogen oxides (NOx) that contribute to smog, is offset by the pollution decreases from closing old coal plants.
This maneuver allows them to evade rigorous air pollution protections that would apply if the gas plant were sited anywhere else – including requirements to install modern controls for smog-forming NOx pollution and to consider cleaner alternatives. This is even true when the companies have made no enforceable commitment to permanently shut down the old coal plants before operating the new gas plants.
This is especially concerning because the Trump administration has finalized a weak NOx pollution standard for new gas plants — rejecting science-based standards achievable with the use of readily available modern pollution controls.
Under New Source Review regulators conduct individualized reviews and may require more protective controls than what is required by broadly applicable New Source Pollution Standards. But with new power plants able to manipulate Project Emissions Accounting to avoid New Source Review, this backstop is lost.
In total, EDF and partners identified at least 12 new or expanding facilities across eight states (Kentucky, Tennessee, California, Oklahoma, Michigan, Georgia, Indiana, North Carolina) that have exploited this loophole to evade New Source Review Safeguards.
Here are just two instances, both in North Carolina:
EDF and our partners will continue to vigorously oppose this damaging policy as the case continues in court.
The U.S. Environmental Protection Agency (EPA) recently proposed eliminating its Greenhouse Gas Reporting Program (GHGRP) — a critical source of public data that shows the sources and scale of pollution that causes climate change, including from oil and gas facilities, landfills, large industrial and manufacturing facilities, and power plants. This data is widely used by policymakers, scientists, businesses, and communities to inform how to address climate pollution. In short, the Greenhouse Gas Reporting Program is the foundation for policies that make life safer, healthier and more affordable for all Americans.
The loss of reliable federal emissions data would be especially consequential for state and local governments who would lose access to information necessary for designing effective climate policies and tracking progress towards emissions goals.
As the federal government threatens to roll back emissions reporting requirements, states can step up to fill the gap, and several are already leading the way. California, Washington, Oregon and Colorado each established their own greenhouse gas reporting rules years ago to improve their ability to track emissions and reach their own climate targets. Just last month, New York joined this group by finalizing its own comprehensive reporting rule. High credibility emissions data is critical for effective climate action; it ensures that states can track progress, hold emitters accountable, and design policies that deliver meaningful reductions and tangible benefits to communities. For example, the existing emissions reporting programs in California and Washington are key to the integrity and success of their respective cap-and-invest programs.
Several states already operate robust greenhouse gas reporting systems which ensure transparency and accountability, providing blueprints for others.
| State | Rule | Rule First Adopted |
|---|---|---|
| California | Regulation for the Mandatory Reporting of Greenhouse Gas Emissions (17 CCR 95100) | 2007 |
| Colorado | Colorado Greenhouse Gas Reporting (5 CCR 1001) | 2020 |
| New York | Mandatory Greenhouse Gas Reporting Program (6 NYCRR 253) | 2025 |
| Oregon | Oregon Greenhouse Gas Reporting Program (340 OAR 215) | 2008 |
| Washington | Reporting of Emissions of Greenhouse Gases (173 WAC 441) | 2010 |
Many states, however, rely solely on data reported through the EPA’s GHGRP to inform design of their climate policies and track emissions progress. Without continued access to such information, they will need to swiftly enact policies to ensure continued operation, independent of the federal program.
On December 1, 2025, the New York State Department of Environmental Conservation finalized regulations for its Mandatory Greenhouse Gas Reporting Program. As the first state to mandate emissions reporting since the EPA proposed rolling back the federal reporting program, New York has set a precedent for states to implement their own reporting mechanisms. The state’s rule will ensure continued transparency and access to up-to-date emissions data.
The rule requires reporting from greenhouse gas emitters across all sectors, including stationary sources (e.g. power plants and manufacturing facilities), fuel suppliers, and electricity importers and exporters. Third-party verification of reported emissions is required for the largest emitters. The rule applies to both emissions sources who have historically reported their emissions to the EPA as well as smaller sources, to give New York policymakers a comprehensive picture of emissions in the state. 2026 will represent the first year of data collection with initial reporting on emissions due mid-2027.
New York’s reporting rule not only ensures continued availability of emissions data amidst federal rollbacks, it will also be essential for measuring compliance with pollution reduction policies, most notably the Clean Air Initiative — New York’s emerging cap-and-invest program. As evidenced by California and Washington, accurate emissions reporting is essential to the reliability and success of market-based climate regulations. Regulators rely on this information to set the emissions cap, ensure polluters are complying with the cap by holding allowances equal to each ton of their emissions, and keep the program calibrated to the state’s climate goals over time. Without accurate reporting, the integrity of these programs could be in question, which is precisely why California and Washington have invested significant time and resources to ensure their programs are robust and polluters are required to report consistently and accurately.
New York has taken a critical step forward by finalizing its emissions reporting program. By fully implementing the Clean Air Initiative, the state can progress from tracking climate pollution to cutting climate pollution while delivering widespread economic opportunity and cost saving benefits to New Yorkers.
With federal attempts underway to dismantle the EPA’s reporting program, New York joins a group of states that have set an important example, advancing durable, science-based systems for greenhouse gas reporting. Other states seeking to protect their communities from the impacts of unchecked climate pollution amidst EPA rollbacks should follow suit. State policymakers should explore opportunities to advance commonsense greenhouse gas reporting requirements under existing authority or work to establish new laws — giving them the tools to put in place effective and comprehensive climate policies in the years ahead.
“If you want to go fast, go alone but if you want to go far, go together.” This perfectly captures the journey to standing up a West-wide electricity market. After years of collaboration, Western states are now closer than ever to a true regional electricity market that can deliver cleaner, cheaper and more reliable power.
In September 2025, Governor Newsom signed AB 825 into law, creating a path to a regional electricity market governed by an independent board made up of members from across the West. It is a major step forward in a decade-long effort to integrate energy systems across western states and improve regional coordination.
In December 2025, the Pathways launch committee adopted a series of corporate documents to enshrine the Regional Organization for Western Energy (ROWE), the new oversight body that will run the market envisioned in AB 825. Included in these documents were the ROWE’s bylaws, which contain a suite of public-interest provisions to ensure that the market will be the most transparent of any organized market in the country. To understand how far the West has come, it’s helpful to reflect on how it all started.
Unlike much of the United States, the electric grid across western states is not managed by a single market operator, commonly known as a Regional Transmission Operator (RTO) or Independent System Operator (ISO). Instead, 37 individual balancing authorities match electricity generation to demand in their jurisdiction and build the infrastructure to both supply and deliver that power. Each of these entities is responsible for balancing grid supply with demand, how much transmission infrastructure gets built and who they contract to buy and sell power from.
The fragmented nature of the Western grid creates significant inefficiencies, increasing the cost of sourcing and delivering power throughout the region, making it harder and more costly to deliver power where it is needed in moments of grid stress. A regional electricity market can alleviate these inefficiencies by increasing coordination and reducing the cost of trading power across utility boundaries, enabling better coordination and data-sharing, and ultimately enabling entities to trade power more cheaply across the West. The geographic footprint of these balancing authorities is large enough that trades amongst them would enable an electric grid that is “larger than the weather” — meaning an extreme event in one balancing authority would not impact several others. A robust market to trade electricity could help out specific areas when there is an extreme weather event. And with the effects of climate change becoming more real, these extreme weather events are only more likely to occur in the coming years.
To help facilitate real-time trades of electricity amongst the different balancing authorities, the West created the Western Energy Imbalance Market (WEIM). Launched in 2014 and currently operated by the California Independent System Operator (CAISO), the WEIM is a real-time energy market. By pooling resources regionally, WEIM allows participants to access the cheapest energy available in real time, which is valuable during events when localized shortages occur. WEIM has been an all-around success since its inception, growing to include over 20 balancing authorities covering about 79% of the load in the Western Interconnection and delivering an estimated $7.4 billion in gross benefits.
CAISO is in the process of building on WEIM’s success by establishing an Extended Day-Ahead Market (EDAM), a forward-looking market where energy trading is done a day in advance and generation is committed to meet forecasted demand for the following day. This kind of early commitment can reduce prices, enhance reliability, and support more integration of renewable energy onto the grid. Analyses of the EDAM demonstrate major benefits across the entire Western grid, in California as a whole, and to individual utilities including PNM, NVE, PacifiCorp.
For deeper dives on the cost and reliability upside, including savings for utilities that join EDAM and the value of a unified West‑wide market, see our recent posts:
Studies also have shown that a unified day-ahead market across the region would provide substantial benefits to participants, with additional services toward a full RTO providing even greater benefits. However, until now there has been one central challenge to this unified, coordinated market structure: how it is governed. A market designed to serve the entire West must be governed by the entire West. While previous attempts have been made to address governance concerns, none has succeeded and the result has been stagnation of regional market development, at least until now.
FERC also has a great explainer on energy markets in the Western United States.
Launched in 2023, the West-Wide Governance Pathways Initiative (WWGPI) is a collaborative effort by regulators from several Western states, including Arizona, California, New Mexico, Oregon and Washington that was designed to bridge the governance challenge that has stymied expansion of Western markets (EDF has served on the Launch Committee of the Pathways Initiative since its formation). The goal of the Pathways Initiative is to create a structure that is truly independent and representative of the entire region, creating more opportunities for input and decision-making by parties that reflect the diversity and interests of the region as a whole.
This vision for a truly regional electricity market took an enormous step forward in September when California Governor Gavin Newsom signed AB825, which enables California’s electric utilities to participate in an independently governed regional market. Importantly, AB825 also affirmed state-level independence over electricity policy, making clear that participation in a regional market does not impede state policymakers’ authority to set utility requirements based on the priorities and needs of that state.
With the adoption of AB825 into California law, the Pathways Initiative moves to its next phase: the creation of the Regional Organization for Western Energy (ROWE) — a fully independent entity with exclusive authority over both WEIM and EDAM, as well as potential future market offerings.
The ROWE will manage both the existing Western markets (EIM and EDAM) and new market mechanisms, including resource adequacy, with others that can be added over time. The ROWE will be governed by a fully independent board, separate from CAISO, whose members will be nominated by market stakeholders. The new corporate governance documents, including the bylaws that will be submitted this year, set a new standard for transparent, responsive, and effective electricity market governance. The only market operator in the country with an Office of Public Participation, modeled on FERC’s own Office of Public Participation, to facilitate greater input from organizations beyond just utilities.
With AB825 now law in California, a fully integrated West-wide electricity market is within reach. While there is much more work to do in the years to come, it is important to recognize the progress that has happened to date.
Even as recent federal actions have attempted to weaken or eliminate clean vehicle standards, states across the country are taking actions to support clean, affordable transportation – actions that cut pollution and save people money. EDF’s new U.S. Electric Vehicle State Policy Landscape Report provides a comprehensive assessment of how all 50 states and the District of Columbia are shaping the next generation of clean, affordable vehicles. The results are unmistakable: every state has taken steps to advance electric vehicles, and many are deploying innovative policies that deliver cleaner air, lower costs, and create economic opportunity.
The report evaluates 16 distinct policy types across seven categories – from financial incentives to charging infrastructure to public fleet electrification. This nationwide assessment reveals both remarkable breadth and significant depth: many of the strongest EV policy portfolios span diverse states across the country like Arizona (14), Illinois (13), Alabama (12), and Colorado (13).
States Are Making EVs More Affordable
Direct financial incentives remain one of the most effective ways to put more drivers behind the wheel of a clean light-, medium-, or heavy-duty vehicle, and states are making that possible:
These incentives make clean transportation an even more affordable option for households and companies.
Charging Infrastructure Is Expanding Rapidly
States are also dramatically expanding EV charging access – a foundational step for widespread adoption:
And all states and DC have adopted fast-charging corridor plans through the bipartisan National Electric Vehicle Infrastructure (NEVI) program, helping ensure EV drivers can travel long distances with confidence.
Public Fleets Are Going Electric
Many states are embracing EVs in transit fleets, school buses, and state agency vehicles, helping clean the air where people live, work, and learn:
These commitments accelerate deployment, lower public-sector fuel and maintenance costs, and EV use across communities.
Innovation and Collaboration Are Accelerating Progress
Some of the most innovative developments involve emerging technologies and regional coordination:
These forward-looking strategies further expand the benefits of clean, affordable solutions.
The Path Ahead
Despite federal uncertainty, states continue to lead the way. In addition to analyses from partners across the clean transportation sector, EDF’s new report offers an overview that policymakers, utilities, advocates, and industry leaders can use to accelerate this progress and ensure every community benefits from zero-emission transportation solutions. Explore the full report at https://www.edf.org/how-states-are-powering-americas-clean-transportation-future.
Research from Environmental Defense Fund shows that when it comes to evaluating the climate efficacy of carbon dioxide removal (CDR) strategies, timescale matters.
CDR strategies like wetland restoration and direct air capture are critical for reaching net-zero targets. We typically assess their potential climate benefit by calculating the amount of net carbon dioxide equivalent (CO2e) emissions removed from the atmosphere, balancing the emissions and removals of various greenhouse gases (GHGs) by their climate impact over the 100-year timeframe.
However, some CDR strategies can increase other greenhouse gases, including methane that has a much shorter lifetime in the atmosphere. That warms the climate in the near term. This new study uses wetland restoration as a case study to demonstrate that relying only on long-term metrics can overlook potential near-term warming impacts.
The limits of GWP 100
Most climate assessments today use the 100-year Global Warming Potential (GWP100), which compares the climate impact of a non-CO2 greenhouse gas emission to an equal amount of CO2, allowing all greenhouse gases to be expressed as the net CO2e, comparing all emissions to carbon dioxide over a 100-year time horizon.
This metric allows us to represent the climate impacts of multiple greenhouse gases on the same scale. With GWP100/CO2e as the standard, results are often reported as CO2e with no mention of the timescale, or near-term impacts.
Methane is a potent, short-term climate accelerator, and its short-term impacts can be diluted and under accounted for using only the GWP100/CO2e metric because for 80 out of the 100 years it’s evaluated, the pulse of methane is no longer in the atmosphere. That can create a blind spot in our evaluation of these strategies’ climate benefits.
Case in point: wetland restoration
Wetland restoration illustrates the importance of timescales. Restored wetlands act as a carbon sink and provide major ecological benefits, yet saturated soils can generate methane. The net climate impact depends not only on how much CO2 is removed from the atmosphere, but also on the full set of greenhouse gases involved and the metrics chosen to evaluate their relative impacts. The results suggest that perceived climate benefits may be undermined by the extent of methane emissions.
The EDF study also provides a practical framework to account for the climate impacts of all greenhouse gases across different time horizons, which can be used to evaluate any CDR strategy. With basic emissions data, users can apply arithmetic or more advanced open-source modeling tools. This gives researchers and decision-makers visibility into both potential near-term climate risks and long-term climate benefits, helping them fine-tune their CDR project designs.
Carefully designed CDR strategies
Recognizing potential trade-offs gives us the opportunity to design more effective CDR strategies. It’s like planning a budget: long-term gains may be well worth the short-term expenses, but it is certainly better to plan for and track current spending. Better yet, the “short-term expense” could be managed. For example, wetland restoration project developers can potentially choose sites and practices that limit methane emissions increases or complement CDR with other methane mitigation strategies.
Accounting for the climate impacts of various greenhouse gases using both near- and long-term metrics in CDR research is the first step. Policymakers should encourage climate benefit evaluations that go beyond carbon dioxide and 100-year effects before pursuing CDR strategies. Doing so helps ensure near-term warming doesn’t undermine long-term climate goals. This new framework from EDF helps fill this gap in our thinking, so CDR can genuinely serve both near- and long-term climate goals.
