Blog
California Cuts Natural Gas Use as Solar and Batteries Rise
Estimated reading time: 6 minutes · Last updated:
California has reduced its reliance on gas-fired electricity sharply as utility-scale solar and battery storage scale up and regional power sharing improves. U.S. Energy Information Administration figures show a 15 percent drop in gas-fired generation in 2025 versus 2024 and a 26 percent decline in the January–June period of this year compared with that same period in 2025. Dan Gearino reported the EIA numbers and interviewed GridLab analyst Ed Smeloff, who sums up the shift: "The key story here is batteries," as first reported by Inside Climate News. The state now uses batteries to store abundant midday solar and discharge at evening peaks, cutting the run time of expensive peaker plants.
Key takeaways
- EIA-measured decline: The U.S. Energy Information Administration shows a 15 percent decrease in California’s gas-fired electricity in 2025 compared with 2024.
- Year-to-year half‑year drop: EIA data show gas generation fell 26 percent in the January–June span of this year compared with January–June of 2025.
- System peaks illustrating the change: On Aug. 26 the California ISO recorded a 5:55 p.m. peak of 46,015 megawatts; by contrast the all-time peak was 52,061 megawatts on Sept. 6, 2022.
- California’s share of national gas use for power: California’s gas consumption for electricity fell from 10 percent of the country’s total in 2014 to 4 percent in 2025, per EIA data.
Table of contents
- Key takeaways
- How batteries reshape the daily grid curve
- Policy, rooftop systems and regional trade cut demand for gas
- Wind, transmission contracts and what counts as California power
- What the shift means — and where cautions remain
- How this could play out
- What to be careful about
- Frequently asked questions
How batteries reshape the daily grid curve
The clearest technical change comes from batteries paired with large amounts of solar. On an August day highlighted by GridLab analyst Ed Smeloff, utility solar produced large surpluses through midday while batteries charged, pulling stored energy back onto the grid after sunset when demand peaked. That Aug. 26 snapshot included a system peak of 46,015 megawatts at 5:55 p.m., and the California Independent System Operator’s charts show batteries sitting below zero while they charge and then rising sharply to discharge in the evening.
That charging-then-discharging pattern reduces the need for short-duration peaker plants that historically ran for a few hours at a time and were among the least efficient generators. By replacing peaker hours with battery dispatch fed by solar, the grid avoids some gas burns without needing a wholesale redesign. Smeloff’s visual comparison with Sept. 6, 2022 — the all-time peak of 52,061 megawatts — makes the point: solar and storage now occupy slices of the daily curve that were once gas-dependent.
Policy, rooftop systems and regional trade cut demand for gas
State policy and customer action pushed the change beyond utility projects. California lawmakers and regulators adopted rules intended to lower carbon, and millions of rooftop solar installations plus customer-owned batteries directly cut net demand on the grid. State data show California has more customer-owned solar panels and battery systems than any other state, creating a distributed resource pool that helps reduce gas use even though its precise effect on grid operations is difficult to quantify.
Operators also use better coordination with neighboring regions to tap hydropower and other resources. Smeloff and the reporting point out that hydropower from Oregon and Washington is now more likely to flow into California when it is valuable, while new long-distance transmission and firm contracts can make an out-of-state wind farm functionally local for the California grid.
Wind, transmission contracts and what counts as California power
Wind plays a role through projects tied to dedicated transmission. The SunZia wind project in New Mexico is treated as a local resource on the California grid since a firm contract commits the bulk of its generation to California over a dedicated transmission corridor; project filings call SunZia the largest wind farm in the country. That arrangement shows how transmission contracts change where generation is credited and how larger wind builds can support California’s system despite being physically distant.
At the same time, federal policy is slowing onshore wind development elsewhere: reporting cited the American Clean Power Association saying 44 gigawatts of projects are stuck in federal review. Those permitting backlogs are a separate constraint on wind’s ability to scale nationwide, even as projects with firm transmission to California already supply the state.
What the shift means — and where cautions remain
Researchers and operators agree the trend is real but differ on interpretation. Jonathan Koomey, an energy researcher, called the pattern “pretty obvious,” and Smeloff emphasized batteries as the central factor. California ISO spokeswoman Jayme Ackemann warned that looking at a single peak day can overstate the case: gas remains available to support reliability even if it is used less often, and system-wide planning must account for that availability.
The reporting also flags open questions: whether consumers will see lower bills over time as peaker hours disappear; how new federal or state rules might alter project pipelines; and how transmission and permitting bottlenecks will shape where renewables and storage can be built. Coal is effectively absent from California’s mix, and the state’s share of the nation’s gas-for-power dropped from 10 percent in 2014 to 4 percent in 2025, but those aggregate figures conceal the operational choices grid managers still face.
| Period or date | Key figure | Context |
|---|---|---|
| Aug. 26 (daily peak example) | 46,015 megawatts | Batteries charging midday and discharging post-sunset reduced gas use at the peak |
| Sept. 6, 2022 (all-time peak) | 52,061 megawatts | Higher peak with relatively less solar and storage compared with Aug. 26 example |
| 2014 vs 2025 (national share) | 10% → 4% | California’s share of U.S. gas consumption for electricity fell from 10 percent in 2014 to 4 percent in 2025 (EIA) |
How this could play out
The case for
- Higher battery deployments paired with more utility solar and firm transmission contracts could continue to displace peaker-hour gas burns and lower operating emissions.
- Projects like SunZia that deliver power over dedicated lines can make distant wind functionally local to California, increasing dispatchable renewable supply when planned capacity comes online.
The case against
- Federal permitting delays for onshore wind — roughly 44 gigawatts noted by the American Clean Power Association — will limit wind’s near-term contribution outside projects with prearranged transmission.
- Policy changes, rooftop solar rule adjustments, or slower-than-expected battery cost declines could raise costs or slow retirements of peaker plants, preserving some gas demand for reliability.
What to be careful about
- Overreliance on short-duration batteries without parallel investments in long-duration storage or transmission could leave the system exposed on multi-day low-sun periods.
- Counting distant generation as local via firm contracts depends on transmission availability; constraints or outages on those lines would reduce the effective supply credited to California.
- Permitting backlogs at the federal level could stall new wind capacity that the state and region expect to call on in future years.
The bottom line
California’s recent drop in gas-fired electricity is a product of three linked changes: a surge in utility-scale solar, rapid growth in battery storage that times that solar for evening demand, and better regional transfers supported by transmission and firm contracts. EIA data cited in the reporting quantify the decline — 15 percent year-over-year in 2025 and a 26 percent first-half comparison — but operators still treat gas as a reliability backstop. Replicating California’s pattern elsewhere will depend on local policy, transmission buildout, and the pace of wind and battery projects entering service.
What to watch
- Watch for federal permitting decisions on the roughly 44 gigawatts of onshore wind projects said to be in review; no dates have been set.
- Watch for contract or operational updates from the SunZia wind project about its flows into California and any changes to its firm transmission terms; no date has been set.
Frequently asked questions
How much did California reduce gas-fired electricity recently?
The U.S. Energy Information Administration reports a 15 percent decrease in gas-fired generation in 2025 compared with 2024, and a 26 percent reduction for January–June of this year versus January–June of 2025.
What is SunZia and why does it matter to California’s grid?
SunZia is a wind project in New Mexico that is credited to California because a firm contract directs most of its output to the state along a dedicated transmission link, and project documents describe it as the largest wind farm in the country.
Why are batteries described as the key factor in reducing gas use?
Batteries charge using abundant midday solar and then discharge at evening peaks, replacing hours that peaker plants used to run; the CAISO example on Aug. 26 shows batteries charging below zero and then discharging into a 46,015 megawatt system peak.
Related reading