The state of California has long been at the head of the country’s efforts towards energy independence and environmental sustainability. And with an announcement this past Friday, it’s clear that those efforts will continue into the foreseeable future. The state has announced that it has finally reached a settlement with NRG Energy concerning the power contracts that helped cause California’s energy crisis last decade. And with the settlement bringing $120 million into the state’s coffers, the government declared it is going to use the vast majority of the funds to expand the network of electric car charging stations across the state.
NRG was found liable for their part in the California power crisis because of their co-ownership of power plants with Dynegy. Enron and other power producers shut down plants at their whim, boosting what they were able to charge California utility companies. This in part led to the power crisis, and to Governor Gray Davis losing his office to Arnold Schwarzeneger. The State of California ended up suing Dynegy, and NRG bought the embattled company’s power plant shares.
The settlement still awaits approval from the Federal Energy Regulatory Commission and the California Public Utilities Commission. $100M of the settlement money will go towards charging stations in San Diego, Los Angeles, San Joaquin Valley and the San Francisco Bay area. The $20 million left will be earmarked for programs that lower home electricity costs for consumers. This announcement will certainly benefit NRG Energy as well. They’ve been involved in developing electric charging stations for a while now, with their eVgo brand. As long as the settlement is approved, they will be in a position to build the network of charging stations, as well as own and operate it.
All finances and politics aside, this announcement illustrates California’s support of zero-emission cars. The state has already announced an aggressive plan geared towards reducing greenhouse gases, with electric cars only one aspect of the strategy. Also being contemplated is a larger focus on sun and wind power in the auto manufacturing industry.
After the settlement announcement, California Governor Jerry Brown signed an executive order with steps focused towards getting 1.5 million zero-emission vehicles on the state’s roads over the next thirteen years. He called for all state agencies to help simplify the permitting process, encouraging manufacturers to focus on electric vehicles.
Besides NRG Energy, other winners in this may be California-based technology companies. Tesla Motors, Coda Automotive and Fisker Automotive all produce electric cars from their California facilities, and car charger manufacturers such as ClipperCreek and Coulomb Technologies also call the state their home. But regardless of which corporations benefit, an extended network of charging stations is the only way to expand consumers’ usage of electric vehicles. Many car companies have focused more on hybrid-electric vehicles, as electric-only vehicles have so far shown a very limited range. Hybrid-electrics are still a difficult expense for the average consumer, though some companies have released a Hybrid SUV to lure the luxury purchaser. But as the network for electric car charging increases, more people will see them as a viable alternative, and the overall price will come down.