California Faces Energy Affordability Crisis Amid Renewables Push

California is grappling with a significant energy affordability crisis, despite Governor Gavin Newsom‘s recent claims of progress in renewable energy at the COP30 United Nations Climate Conference in Brazil. While Newsom highlighted that the state sources “two-thirds” of its energy from renewable sources, he faced scrutiny over the accuracy of this statement and its implications for residents facing high energy costs.

A closer examination reveals that, according to the US Department of Energy (DOE), California generated approximately 57% of its electricity from renewable sources and 7% from nuclear power in 2024. However, this figure only accounts for electricity, which represents about 15% of the state’s total energy consumption. The reality is that over 80% of California’s energy still derives from hydrocarbon fuels, with 58% sourced from petroleum and 25% from natural gas as of 2023.

Governor Newsom’s administration has prioritized a transition to renewable electricity for over two decades. The state has closed eleven coal-fired plants and converted three others to biomass fuel, while also shutting down the San Onofre nuclear station in 2013. Concurrently, California has made strides in solar capacity, installing 22 gigawatts of utility-scale solar and 18 gigawatts of rooftop solar, leading the nation in these areas.

Despite these efforts, California’s transition is marked by rising costs. From 2008 to 2024, electricity prices soared by 116%, far exceeding the national average increase of 33%. California’s residential electricity prices now average 32 cents per kilowatt-hour, the second highest in the country, trailing only Hawaii. This sharp increase has led to exorbitant costs for residents, with air-conditioning expenses for a medium-sized home reaching up to $1,000 per month.

In his address at COP30, Newsom also touted the state’s ambitious zero emissions vehicle (ZEV) mandate, which aims for all in-state auto sales to be ZEVs by 2035. While intended to reduce reliance on gasoline, the average cost of a new electric vehicle (EV) in the United States was approximately $59,000 as of April 2025, significantly higher than the average price of $48,700 for a new gasoline vehicle. This pricing disparity persists even after the federal EV tax credit of up to $7,500 was eliminated in September 2023.

California is also a frontrunner in hydrogen vehicle technology, with around 12,000 hydrogen cars on the road. However, the cost of hydrogen fuel is substantial, priced at least $14 per equivalent gasoline gallon. The California Energy Commission has invested over $200 million in hydrogen fueling stations, but the total number has dwindled from around 65 to 55 stations, coinciding with a decline in hydrogen vehicle numbers.

The Advanced Clean Fleets Regulation (ACF), which took effect in 2024, mandates that all trucks operating in California must be zero emissions. However, electric trucks are priced 2-3 times higher than their diesel counterparts and offer limited travel range, creating further strain on affordability. The ACF has faced challenges, especially after Congress and the previous administration revoked California’s ZEV and ACF waivers in May 2023.

California’s fuel prices are also among the highest in the nation, with regular gasoline costing approximately $4.67 per gallon, over 50% higher than the national average of $3.07. The closure of refineries has exacerbated this issue, with California’s operational refineries dropping from more than 40 in the 1980s to just 13 today. The impending closure of two additional refineries could drive gasoline prices up to $8 per gallon.

The failures of renewable energy systems further complicate California’s energy landscape. The Ivanpah Solar Power Facility, once the world’s largest solar installation, is set to close after just twelve years of operation due to underperformance and reliance on natural gas. Additionally, recent incidents involving grid battery storage systems have raised safety concerns. In May 2024, the Gateway Energy Storage facility caught fire and burned for seventeen days, with subsequent fires at other battery facilities leading to evacuations and service disruptions.

New regulations aimed at promoting renewable energy, such as the 2020 California Solar Mandate, require new homes to incorporate solar panels and wiring for electric appliances. While these measures aim to support green energy initiatives, they have contributed to rising housing costs, posing challenges for low-income residents.

Although the current Democratic narrative emphasizes affordability, California’s experience serves as a cautionary tale about the challenges of implementing renewable energy policies without considering economic impacts. As the state continues to navigate its energy affordability crisis, residents are left facing rising costs and uncertainty about the future of their energy landscape.