3: STUDY RESULTS: LEAST-COST, LEAST-RISK PATHWAYS AND TRADE-OFFS

Least-cost, least-risk pathways and trade-offs

When different decarbonization scenarios are evaluated against the selected key criteria55, one critical learning that emerges is that, in multiple ways, the presence of a clean fuels network minimizes challenges in and obstacles to California’s energy transition.

The three scenarios that include a clean fuels network all perform better than a scenario with no clean fuels network across the criteria described above. Therefore, the three scenarios that include a clean fuels network are more plausible and logical for the state of California to pursue (see scenarios in Exhibit 3.1).

While all three scenarios that include a clean fuels network perform well in helping California reach its climate goals, there are important differences that highlight trade-offs for stakeholders to consider. For example, the Resilient Electrifi cation scenario is evaluated as having a higher level of technical maturity because it relies less on emergent technologies such as clean fuels production as compared to the High Clean Fuels scenario; however, the Resilient Electrifi cation system may not provide as clear a solution for substitution of traditional fuels in hard-to-abate sectors, and could also present end-customer challenges related to conversion given much higher levels of building electrifi cation. A more detailed explanation of our evaluation across the selected key criteria follows below. The scenario without a fuels network is the most expensive, and also presents challenges in terms of resiliency and addressing hard-to-abate sectors. It will likely also necessitate the most effort from and cause the most disruption for customers.

Exhibit 3.1. Assessment of scenarios along selected key criteria

Resilient Electrifi cation High Clean Fuels High Carbon Sequestration Full Electrifi cation (No Clean Fuels)

System Reliability and Resiliency

Solution for Hard-To-Abate Sectors

Customer Conversion Challenges

Technical Maturity

Affordability

$230B $215B $245B $290B

Minimal challenges and/or highest benefi t for California Signifi cant challenges; potentially not viable for California