Energy is a major area of the economy of California, as it has the largest population and the largest economy in the United States. , it is second in total energy consumption after Texas, though per capita consumption was the third-lowest in the United States partially because of the mild climate and energy efficiency programs. In 2023, 45% of energy consumption was used for transportation, with California being the largest consumer of jet fuel, and the second largest consumer of gasoline after Texas. The state uses more than 1 million barrels of refined products daily.
While California was the eighth-largest producer of crude oil among the 50 states in 2024, it still imports 75% of the oil it consumes. In 2026, about 25% of the state's crude oil imports were from the Middle East, a higher ratio than any other US state.
The state was the second largest importer of electricity in 2024, and that year produced 57% of its in-state electricity generation from renewables, with the remaining in-state generation being 35% from natural gas and the rest from nuclear. Californians pay some of the highest prices for electricity, with an average price per kWh of $0.26 in May 2025, double the nationwide average of $0.13 per kWh.
Electricity
Natural gas-fired power plants typically account for almost one-half of in-state electricity generation. California is one of the largest hydroelectric power producers in the United States, and with adequate rainfall, hydroelectric power typically accounts for close to one-fifth of State electricity generation. There are plans to remove older dams.
California's peak electricity demand of 52,061 megawatts occurred on September 6, 2022, during one of the longest and hottest September heatwaves on record, which encompassed multiple Western states. Widespread rolling blackouts were narrowly avoided due to conservation efforts, though several thousand customers in Palo Alto and Alameda had their power cut when the California Independent System Operator told those cities' municipal power companies to shed load. The CEO of CAISO stated that the 3,300 megawatts of grid storage batteries added since the August 2020 rolling blackouts were definitely helpful during this event. The previous peak was on July 24, 2006, at 2:44 pm, with 50,270 MW. After the 2006 record, measures to reduce peak load resulted in decreased peak demand, even as the state's population continued to grow. On September 1, 2017, the peak load was 50,116 MW.
Although California's population increased by 13% during the 1990s, the state did not build any new major power plants during that time, although existing in-state power plants were expanded and power output was increased nearly 30% from 1990 to 2001. However, between 2000 and 2015, California built nearly 500 new power plants to supplement the 700 operating in 2000, boosting power supplies by 43%.
In 2016, California Public Utilities Commission (CPUC) announced new rules for connecting coming generation sources to grid. Connection costs must be estimated by the utility, and the developer is limited to paying within ±25% change of the estimate. CPUC expects the rules to lower overall costs for ratepayers. California requires 1.3 GW of utility storage and studies long duration bulk energy storage. The state allocated US$83 million per year during 2017-2019 for behind-the-meter storage.California Ramps Up Energy Storage Plans with Enactment of Four New Bills September 28, 2016 The plan was amended in 2020 to a combined $613 million by 2024.
California's electricity rates are among the highest in the United States as a result of the changing energy mix within the state, including aggressive construction of new natural gas power plants. In 2023, residential electricity bills had increased by 72% on average from 2010, due to several factors: the high cost of renewable generation when CA first started mandating that utilities purchase green power, the cost of subsidizing rooftop solar, and the cost of wildfires (past costs and future mitigation). Due to high electricity demand, and lack of local power plants, California imports more electricity than any other state, (32% of its consumption in 2018) primarily wind and hydroelectric power from states in the Pacific Northwest (via Path 15 and Path 66) and nuclear and natural gas-fired production from the desert Southwest via Path 46. Imported coal-fired electricity ended as of December 2025. In 2018, curtailment was 460 GWh, or 0.2% of generation, but has increased since.
Blackouts
Major blackouts in California include: 1996 Western North America blackouts, caused by a summer heat wave 2000–01 California electricity crisis, caused by market manipulation 2011 Southwest blackout, caused by operator error 2019 California power shutoffs to prevent wildfires, caused by lack of maintenance 2020 blackout
In August 2020, during a heat wave which affected the entire West coast, air conditioning usage caused the peak load to hit 47 GW, and CAISO issued rolling blackouts to avoid a larger system shutdown. The state did not have enough generation ready to fulfill demand, and it was unable to import sufficient electricity from neighboring states who had no surplus themselves. A 4 GW demand reduction alleviated the grid shortfall in the days after the blackouts. State agencies identified three main causes: inadequate preparation for heat waves made worse by climate change, insufficient power in the early evening due to sequencing errors in the shift to renewable energy, and market mechanisms that allowed power to be exported during the shortage.
Transmission grid The electric grid is made of up electric transmission and electric distribution, with electric production by itself averaging about 44% of the cost nationally. As of 2019, transmission costs are the fastest-growing part of the bill, and Transmission Access Charges (TAC) are applied regardless of how far electricity travels across the grid.
California is part of the Western Interconnection, with transmission lines connecting to the Pacific Northwest including the California Oregon Intertie (with a capacity of almost 5 GW) as well as the Pacific DC Intertie, a HVDC line with a capacity of 3.1 GW which brings (predominantly hydroelectric) power from the Pacific Northwest to the Los Angeles area. From the Southeast, Path 46 brings up to 10.6 GW of electricity from sources including hydroelectric, fossil fuels, nuclear, and solar from generating stations in Nevada and Arizona.
Transmission lines under construction as of 2019 include the TransWest Express, which would connect Wyoming to Nevada, which is already connected to Southern California via Path 46.
While experts have stated that more grid connections to other states would allow California to export its excess solar and wind generated electricity to other states during sunny times of the day, and to import wind generated electricity when wind is blowing in other Western states but not in California, the legislature has resisted allowing more connections for fear of losing sovereignty over the state's electricity supply.
Generation
, California had 80 GW of installed generation capacity encompassing more than 1,500 power plants; with 41 GW of natural gas, 26.5 GW of renewable (12 GW solar, 6 GW wind), 12 GW large hydroelectric, and 2.4 GW nuclear.
Legal renewables requirement
In 2006, the California legislature passed the Global Warming Solutions Act of 2006 which set a goal for 33% of electricity consumption in California to be generated by renewable sources by 2020.
In 2015, SB350 mandated that electric utilities purchase 50% of their electricity from renewable sources by 2030.
Then in 2018, Senate Bill 100 was passed which increased the renewables requirement for electric utilities to 50% by 2026, 60% by 2030, and 100% by 2045.
Natural gas
, California natural gas plants supplied a third of the state's total demand for electricity, (almost half of the state's in-state generation) and supply the state with 41,000 megawatts of installed capacity. Because renewables cannot generate power 24/7, and it is cost prohibitive to install enough solar panels, wind turbines and batteries to supply sufficient electricity to ensure resource adequacy during extended cloudy or windless periods, researchers have estimated that the state will still need between 17 and 35 GW of natural gas fueled capacity in 2050.
Renewables
California leads the nation in electricity generation from non-hydroelectric renewable energy sources, including geothermal power, wind power, and solar power. California has some of the most aggressive renewable energy goals in the United States.California OKs new transmission for renewables Reuters, December 17, 2009. The state is required to obtain at least 33% of its electricity from renewable resources by 2020, and 50% by 2030, excluding large hydro. On May 13, 2017, the California Independent System Operator (ISO) reported that the state had broken a new instantaneous renewable energy record, with non-hydro renewables providing 67.2% of the total electricity on the ISO's grid, with another 13.5% being provided by hydro. Intermittent solar power has led to a peak demand and peak production imbalance creating a "duck curve", where traditional power plants produce little generation at noon, ramping fast to high generation at dusk.
Solar Energy Generating Systems (SEGS) is the name given to nine solar power plants in the Mojave Desert which were built in the 1980s. These plants have a combined capacity of 354 megawatts (MW) making them at one time the largest solar power installation in the world.SunLab (1998).Solar Trough Systems Retrieved December 18, 2008. Other large solar plants in the Mojave Desert include the 392 MW Ivanpah Solar Power Facility,Sacrificing the desert to save the Earth LA Times February 5, 2012. opened in 2014, and the 550 MW Desert Sunlight Solar Farm and 579 MW Solar Star, both completed in 2015. The Beacon Solar Project, which generates 250 MW for the LADWP, was completed in 2017 in the northwestern Mojave Desert.
The Alta Wind Energy Center in the Tehachapi Mountains is the largest wind power plant in the United States with 1,548 MW installed capacity. A facility known as "The Geysers," located in the Mayacamas Mountains north of San Francisco, is the largest group of geothermal power plants in the world, with more than 750 MW of installed capacity. California's hydroelectric power potential ranks second in the United States (behind Washington State), and substantial geothermal and wind power resources are found along the coastal mountain ranges and the eastern border with Nevada. High solar power potential is found in southeastern California's deserts.
Energy storage
California has several large pumped-storage hydroelectric powerplants.
Assembly Bill 2514 directed the California Public Utilities Commission (CPUC) to adopt an energy storage program and procurement target. As a result, the CPUC established an energy storage target of 1,325 MW by 2020. In 2014, Southern California Edison commissioned the 8MW/32MWh Tehachapi Energy Storage Project, which was the largest lithium-ion battery system operating in North America and one of the largest in the world at the time of commissioning. The 1-hour 230 MW Gateway Energy Storage project near San Diego became the biggest Lithium-ion grid storage in 2020, and several more are under construction. From 2014 to 2024, the halving time of levelized cost of storage was 4.1 years, while capacity doubling time was 1.2 years.
Nuclear