California Assembly Bill AB740

California 2025-2026 Regular Session

• Introduced: 2/18/25
• Refer: 3/3/25
• Report Pass: 3/12/25
• Refer: 3/13/25
• Report Pass: 4/24/25
• Refer: 4/29/25
• Refer: 5/14/25
• Report Pass: 5/23/25
• Engrossed: 6/2/25
• Refer: 6/3/25
• Refer: 6/11/25
• Report Pass: 7/16/25
• Refer: 7/16/25
• Report Pass: 8/18/25
• Refer: 8/18/25
• Refer: 8/25/25
• Report Pass: 8/29/25
• Enrolled: 9/11/25

Caption

Virtual power plants: load shifting: integrated energy policy report.

Impact

The most significant impact of AB 740 revolves around the requirement for electrical corporations to report their contributions towards meeting load-shift goals. This provision aims to hold utilities accountable and encourages them to increase their efforts in reducing peak load demands, which is essential amid California's push for cleaner energy solutions. By integrating virtual power plants into the regulatory framework, the bill strengthens the state's commitment to reducing greenhouse gas emissions and addressing energy reliability issues, particularly as more renewable energy sources are integrated into the grid.

Summary

AB 740, introduced by Assembly Member Harabedian, is a legislative measure focused on the deployment of virtual power plants and load shifting strategies to enhance California's integrated energy policy. The bill mandates the State Energy Resources Conservation and Development Commission (Energy Commission) to develop a deployment plan for virtual power plants for the next biennial integrated energy policy report after January 1, 2027. This is a key response to the state's evolving energy landscape, aiming to utilize distributed energy resources for improved grid management and peak demand reduction.

Sentiment

The sentiment surrounding AB 740 is largely positive among environmental advocates and renewable energy proponents, who view the bill as a substantial step towards modernizing California's energy infrastructure. However, there are concerns from utility companies regarding the feasibility of implementing the required reporting and resource management strategies. The bill represents a shift towards more proactive energy management practices, although the potential challenges of operationalizing these changes remain a point of debate.

Contention

Notable points of contention stem from the administrative burden placed on electrical corporations due to the annual reporting requirements and the necessity for compliance with load-shift goals. Critics argue that the effectiveness of virtual power plants and the anticipated cost savings require careful evaluation to ensure they do not lead to increased financial strain on participating and non-participating ratepayers alike. Ultimately, the successful implementation of AB 740 relies on collaboration among stakeholders, including utility providers, regulatory agencies, and consumer advocates.