Created by a vote of Sacramento County residents on 2 July 1923 pursuant to the Municipal Utility District Act,[5][6] SMUD's ability to provide power to its customer-owners was stymied in the courts for nearly a quarter century by the investor-owned Pacific Gas & Electric Company (PG&E) of San Francisco.

[8][9] Echoes of SMUD's fight to fulfill its original mandate from the voters have continued in more recent turf battles with PG&E.

The plants are run during hours of peak demand, though retaining sufficient flood control capacity dictates water releases to some extent.

From upstream to downstream, the District's UARP assets include:[13][14] SMUD owns the first of potentially two natural gas power plants (the Cosumnes Power Plant, brought online in 2006 on property adjacent to the decommissioned Rancho Seco nuclear facility) as well as wind-powered and solar-powered electric generation facilities.

In addition, the utility owns some small gas-fired peaker plants for meeting the highest energy demands, typically on Sacramento's notably blistering summer days.