Electricity: virtual power plant procurement.
The bill mandates that load-serving entities procure increasing percentages of their energy capacity from VPPs—starting at 2.5% by 2028 and scaling up to 15% by 2035. This is expected to support California's broader energy strategy, emphasizing the importance of demand response and efficiency before resorting to new electrical generation methods. The legislation also aims to facilitate regulatory frameworks that foster the growth of VPPs, including the ability to postpone compliance deadlines if entities can demonstrate that achieving the targets is not cost-effective.
Senate Bill 1305, introduced by Senator Stern, aims to amend the Public Utilities Code by instituting procurement requirements for electricity from virtual power plants (VPPs). VPPs are defined as coordinated aggregations of distributed energy resources, such as solar panels and battery storage, which can be utilized to meet the energy demands of electrical corporations, electric service providers, and community choice aggregators. The bill establishes timelines for these entities to procure specific amounts of capacity from VPPs, enhancing the integration of renewable energy sources within California's electricity grid.
The sentiment around SB 1305 appears largely supportive among advocates for renewable energy and sustainability. Proponents argue that VPPs will reduce reliance on fossil fuels, lower emissions, and provide cost savings for consumers by enhancing grid reliability and efficiency. However, some stakeholders may raise concerns about the feasibility of rapid transitions to VPPs and the availability of necessary technology and resources, indicating a measured approach may be needed to address industry readiness.
Notable points of contention may arise around the timelines set for capacity procurement and the definition of compliance, as entities may face challenges in adaptation and resource allocation. There could also be debates regarding the costs associated with implementing these changes and ensuring that VPPs can effectively compete with traditional energy sources. The requirement for annual reporting to the commission on compliance progress may impose additional administrative burdens on load-serving entities, leading to potential legislative pushback.