On June 17, E3 hosted a public webinar on the state of the California electricity market and its implications for Community Choice Aggregators (CCAs). E3 experts Nathan Miller and Emily Rogers walked through the latest trends in market fundamentals, resource planning, and procurement strategy, with a focus on how CCAs can navigate an increasingly uncertain environment.
The webinar drew on E3’s in-house electricity price forecast for the CAISO market, including detailed projections for load growth, resource additions, price formation, and reliability conditions. The discussion was grounded in historical trends from 1995 through the present day, and it looked ahead to the forces shaping procurement decisions in the decade to come.
Key webinar takeaways:
- California’s electric load is growing faster than it has in decades. In addition to continued electrification of vehicles and buildings, the state is seeing a surge in large commercial loads, especially data centers. E3’s forecast shows that EVs alone could add over 140 TWh to system load by 2050. On the supply side, CCAs now play a dominant role in renewable procurement, and their portfolios already exceed the 2030 RPS targets. The resource mix has shifted dramatically: between 1995 and 2024, California added tens of GWs of solar and wind, with battery storage rising sharply in the past three years.
- CCAs now account for a majority of procurement activity in California. As the state continues to need new resources to meet clean energy and reliability targets, new procurement mandates are likely in the future. E3 highlighted the proposed Reliable and Clean Power Procurement Program (RCPPP) which would set procurement requirements for CPUC-jurisdictional Load Serving Entities (LSEs) aligned with the state’s Integrated Resource Planning (IRP), Resource Adequacy (RA), and Renewable Portfolio Standard (RPS) programs.
- With mid-day solar output frequently exceeding load, curtailment and negative energy prices are becoming more common. E3 shared hourly generation profiles that illustrate how much of this curtailment occurs in spring and fall shoulder months. These dynamics reduce the market value of solar and highlight the growing role of storage in capturing value and maintaining reliability. At the same time, California is seeing higher and more volatile REC prices—in 2024 ranging from $30 to $80/MWh—which, when paired with negative energy prices, can incentivize curtailment, creating complex tradeoffs for developers.
- E3 emphasized that future procurement decisions will be higher stakes and harder to get right. Capacity market prices are rising, driven by tightening reserve margins and higher new resource costs. Federal policy (e.g., tax credits, emissions limits) remains unsettled. E3’s updated cost and performance benchmarks reflect both rapid technology evolution and higher inflation-adjusted project costs. At the same time, California’s net load shape is shifting, with steeper evening ramps and deeper mid-day troughs, adding to reliability challenges.
California needs more generation and future resource decisions will involve greater risk. Solar and storage will continue to dominate near-term builds, but a clean, firm dispatchable resource will eventually be needed. At the same time, affordability concerns and policy uncertainty are narrowing the window for maneuvering: wildfire damage and mitigation costs, replacement of aging distribution infrastructure, and legacy net energy metering policy are pushing up retail rates. Still, CCAs are well-positioned to meet this moment. A clear understanding of fundamental market conditions will be key to making strategic, cost-effective choices.
Watch the webinar below. Slides can be found here.
Stay tuned: E3’s updated 2025 electricity market price forecast for CAISO (as well as every other North American market) will be released in July. These fundamentals-based forecasts include day-ahead and real-time energy prices, ancillary services, resource adequacy, and renewable energy credit prices. They reflect E3’s view of how technologies, policies, economics, and customer behavior will shape the market through 2050 and beyond.
