California is accelerating efforts to achieve its clean energy goals of 100 per cent zero-carbon electricity by 2045, with interim targets of 60 per cent by 2030, 90 per cent by 2035 and 95 per cent by 2040. According to the California Independent System Operator’s (CAISO) 20-Year Transmission Outlook (July 2024), the state will need between $45.8 billion and $63.2 billion in new transmission capacity over the next two decades, with offshore wind development (at $37 billion) being the primary driver of the higher projected costs.
To ensure that the grid does not become a bottleneck to achieving clean energy goals, California is reforming how transmission infrastructure is planned, permitted and built. This has become urgent given the long lead times for power transmission projects. According to an analysis conducted by the California Public Utilities Commission’s (CPUC) Public Advocates Office, the average time taken to plan, permit and construct projects at 200 kV or greater voltage is 11 years and 9 months, and slightly lower at 10 years and 3 months for projects between 50 kV and 200 kV.
On January 30, 2025, the CPUC adopted a new General Order (GO), 131-E, to replace GO 131-D, which governs the CPUC’s permitting process for utility infrastructure projects. The objective is to make it easier and faster to approve and build electric transmission projects and related grid upgrades in the state.
Notably, only some transmission projects require the CPUC’s permission and approval as CAISO, through its transmission planning process (TPP), oversees compliance with the California Environmental Quality Act (CEQA) and approves most of the state’s transmission projects, exempting them from the CPUC’s review. Projects that require the CPUC’s approval proceed in one of two ways – through an advice letter or notice of construction (a process that allows the transmission owner to file an action request noticing the start of construction), or a certificate of public convenience (CPCN) or permit to construct (PTC) (required for projects that require the CEQA review by the CPUC).
The CPUC’s GO 131-E marks Phase II of the reforms. Phase I was completed in December 2023 with the CPUC’s decision (D.23-12-035) to update GO 131-D, fixing outdated rules and making changes required by Senate Bill (SB) 529 to streamline modifications of existing transmission facilities. Specifically, SB 529 required the CPUC to eliminate the CPCN requirement for projects extending, expanding, upgrading or modifying existing facilities. It also authorised the use of the more streamlined PTC process or claim of exemption for such projects within existing easements, rights of way or franchises.
Under Phase II, the proposal for which was opened on December 27, 2024, the CPUC adopted further updates beyond those addressed in Phase I, including amendments mandated by subsequent legislations – Assembly Bill (AB) 1373, AB 551 and AB 2292. These changes will accelerate permitting timelines by reducing redundancy and shifting environmental analysis to an earlier spot in the application process.
The new regulations include:
Pre-filing consultation: Transmission project applicants are required to meet with the CPUC staff at least six months before submitting their applications. This is to help better prepare the applicants and create a smoother review process.
Applicant-prepared documents: The rules require an early pre-filing coordination process and provide applicants with the opportunity to prepare and submit the draft version of CEQA documents in lieu of the proponent’s environmental assessment to help accelerate the processing time for the CPCN and PTC applications. This is expected to minimise duplication and enable applicants to complete further analysis before filing an application.
Pilot programme to explore faster environmental review: A pilot programme will be created to study ways to streamline the CPUC’s existing CEQA review process. The CPUC’s energy division staff has been instructed to report on the results of this pilot review on December 1 of every even year, starting from 2026. The idea is to explore the potential for accelerating the review process.
Presumption of need for projects: A rebuttable presumption has been implemented as per AB 1373, such that when CAISO determines that a project is needed, the CPUC will defer to that need determination. This will avoid duplicative need determinations and analysis of unnecessary alternatives. It also reflects the AB 2292 provisions that did away with the requirement of the CPUC to consider cost-effective alternatives during the project application review.
Advice letter protests: Anyone who wishes to protest an advice letter issued by utilities for projects that do not require CPUC permission can file an application for rehearing, asking the CPUC to review the staff’s action on the letter protest, in line with AB 551. The CPUC, after its preliminary investigation, may hold public hearings. Construction cannot start until the CPUC executive director disposes of the protest after consulting with the commission’s energy division (within 30 days of the utility submitting its response) – either by issuing a disposition letter to the utility to file an application for a PTC or dismissing the protest for failure to state a valid reason. The utility can contest the disposition letter within 10 days of its issuance.
Simplified reporting requirements: Utility reporting requirements to the CPUC for electric transmission projects have now been simplified, aligning them with the existing CAISO TPP and other reporting requirements.
Key terms: The decision defines key terms, such as existing electrical transmission facilities, extension, expansion, upgrade, modification, equivalent facilities or structures, and accessories, to better explain which type of projects require formal permits and which projects are exempt.
Amendments in utility reporting on planned transmission facilities: All utilities, including independent transmission owners, must file an annual report with the energy division, on all planned transmission projects (>50 kV and over $1 million investment) for which a CPCN or PTC application or advice letter has been or is expected to be filed. Additionally, utilities must meet the energy division staff every quarter (unless it is confirmed that such a meeting is not needed) to brief them on the forecast of the CPCN or PTC applications or advice letters expected to be submitted within the next two years, as well as any changes in the projected in-service date for projects. They are also required to furnish their financials with the CPUC annually. Utilities that do not have any plans for the next 15 years to construct any transmission facilities that are under the jurisdiction of the Federal Energy Regulatory Commission or CAISO are exempt from this.
The recent reforms would allow for a faster and more streamlined permitting process for transmission projects and accelerate their build-out, which is much needed for California to achieve its clean energy goals.