CAISO approves $6.7B transmission plan

The California Independent System Operator’s board approved a new transmission plan on May 22 that lays out 38 grid projects with an estimated cost of $6.7 billion at full buildout over the next decade. The 2025-2026 plan is aimed at meeting rising electricity demand, maintaining reliability and supporting California’s clean-energy buildout, according to CAISO board materials and the final plan summary. (environmentenergyleader.com) The total came down from roughly $7 billion in the April draft after updated assumptions from transmission owners, according to CAISO’s revised draft and other reports on the decision. (caiso.com) The approval matters because CAISO’s transmission plan is the grid blueprint used to identify which major reinforcements should move ahead under the state’s planning process. (stakeholdercenter.caiso.com) The plan is based on state projections that California load will grow by 15 gigawatts by 2035 and 20 gigawatts by 2040, while installed resource capacity will need to rise by more than 74 gigawatts by 2035 and 107 gigawatts by 2040, CAISO said in a May 12 board memo. ### Where is the biggest share of the spending going? CAISO said 33 of the approved projects are reliability-driven projects totaling about $4.2 billion. Those projects are tied to load growth, electrification and changing grid conditions as the generation fleet shifts toward more renewable resources, according to the board memo. (environmentenergyleader.com) More than half of the projects and more than half of the cost are linked to forecasted electricity demand growth, according to reports summarizing the approved plan. That reflects a planning cycle in which reliability needs, not just renewable interconnection, drove much of the recommended buildout. (caiso.com) ### How much of this is about renewables rather than just peak demand? The 2025-2026 plan also reserves transmission capability for a large clean-energy portfolio shaped by the California Public Utilities Commission’s resource assumptions. The CPUC said its adopted base-case portfolio is designed to facilitate transmission needed to bring online more than 60 gigawatts of new clean generation and storage resources by 2035 while maintaining reliability at the lowest cost to ratepayers. (caiso.com) PV Tech reported that the approved CAISO plan accommodates 45 gigawatts of new solar photovoltaic capacity, alongside battery storage and other resources. (solarbytes.info) Utility Dive, citing CAISO planning materials earlier in the cycle, said the portfolio would enable connection of 30 gigawatts of solar in California, 7 gigawatts of onshore wind and 2 gigawatts of geothermal development, plus access for co-located battery storage projects. ### Why is CAISO emphasizing load growth so heavily now? Neil Millar, CAISO’s vice president of infrastructure and operations planning, said in the board memo that the Greater Bay Area alone saw an increase of more than 2,000 megawatts in year-over-year peak demand growth from the previous planning cycle, with some of that load tied to new data centers. (cpuc.ca.gov) The memo said that increase is one of the factors driving new transmission needs. The planning process itself is built around annual coordination between CAISO, the CPUC and the California Energy Commission. The CPUC said its February 2025 decision transmitted the resource portfolios CAISO would analyze in the 2025-2026 transmission planning process, including demand growth assumptions from the state’s Integrated Energy Policy Report. (pv-tech.org) ### What changed between the draft and the final approval? CAISO’s revised draft, posted in May, said revisions to the cost estimates of two re-scoped projects reduced the total estimated cost of the 38 recommended projects to $6.7 billion. (caiso.com) Environment+Energy Leader reported that the earlier April draft had carried a $7 billion estimate before those updated assumptions were incorporated. CAISO’s stakeholder page shows the sequence leading to approval: draft transmission plan materials were posted on April 7, a revised draft was posted on May 12, and the board meeting followed in May 2026. The board-approved transmission plan posting is listed as the next formal step on that page. (cpuc.ca.gov) ### What happens next for utilities, developers and contractors? Under CAISO’s tariff process, approved transmission projects move from planning into development, and eligible projects can proceed into competitive solicitation or utility-led execution depending on project type. CPUC materials say approved transmission development receives cost recovery through the Transmission Access Charge if it is authorized under the CAISO process. (caiso.com) The next public documents are expected on CAISO’s 2025-2026 transmission planning process page, which lists the board-approved transmission plan posting after the May 2026 board meeting. (stakeholdercenter.caiso.com) That page also hosts Appendix H on project need and description and Appendix I on facilities eligible for competitive solicitation. (cpuc.ca.gov)