A five-year effort to put battery energy storage in Morro Bay is over—at least for now—after Vistra withdrew its application with the city to build the plant earlier this month.
Vistra announced its exit in a letter addressed to the city on April 4, asking Morro Bay to cease any further processing of its, at the time, paused application with the city.
The letter also said that Vistra could still pursue the project through the state, as it found the plot of land, which houses the old power plant, to be “underutilized.”
“When there is more to share about our redevelopment plans, including the potential to use [state approval] to objectively review a plan to renew and reuse the Morro Bay Power Plant site, we will inform you and the community,” the letter read. “We remain committed to evaluating how best to deploy new energy technologies at the site to deliver a solution that is good for the community, our company, and the state of California’s reliability and electric needs.”
According to Morro Bay Mayor Carla Wixom, the city isn’t aware of any future plans for the Vistra-owned site.
“That’s all we know from them, is that they will be withdrawing it and not sure what their plan of action is,” Wixom told New Times.
Vistra and the city have been negotiating since 2020 over developing the battery plant. In 2021, the two came to an agreement that Vistra would pay $3 million if it didn’t demolish and develop the old power plant site.
The controversial project caused residents to pass Measure A-24 in 2024, removing the City Council’s jurisdiction over the site’s zoning, an indirect effort to stop the the battery plant entirely.
In October, Vistra bypassed the city entirely by pursuing state approval under AB 205, a bill passed in 2022 offering energy storage facilities a more streamlined process for project approval.
According to a statement released by the city on April 10, if Vistra were to propose a new project and pursue state approval through AB 205, it would “closely engage in the process to protect the community’s interests.”
Morro Bay Mayor Wixom told New Times that in March, the city asked Vistra if it could acquire the parcel of land after releasing the deed restriction allowing the city to buy the property back for $1 if Vistra didn’t develop the property.
“We respectfully decline your offer to gift the city of Morro Bay our private property,” Vistra said in its April 4 letter.
“I don’t think we use the word ‘gifted,'” Wixom told New Times. “We just wanted to open the dialogue more than anything. We weren’t sure what their consideration would be if they wanted to donate the land, so, yeah, that’s kind of where we were coming from.”
Vistra Senior Director of Communications & Media Relations Meranda Cohn told New Times that the company wouldn’t comment beyond the April 4 letter. Δ
CORRECTION: This story was updated to clarify that the city of Morro bay and Vistra came to an agreement in 2021 that Vistra would pay $3 million if it did not demolish and develop the power plant site. Vistra has technically owned the site since 2018.
This article appears in Apr 17-27, 2025.