Amended IN Assembly March 12, 2025 CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION Assembly Bill No. 740Introduced by Assembly Member HarabedianFebruary 18, 2025 An act to add Section 25302.8 to to, and to add Chapter 6.6 (commencing with Section 25560) to Division 15 of, the Public Resources Code, relating to energy. LEGISLATIVE COUNSEL'S DIGESTAB 740, as amended, Harabedian. Integrated energy policy report: virtual power plants. Virtual power plants: load shifting: integrated energy policy report.Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission), in consultation with specified entities, to adopt a biennial integrated energy policy report containing certain information, including an overview of major energy trends and issues facing the state. ExistingThis bill would require the Energy Commission, on or before November 1, 2026, to adopt a strategy to enable virtual power plants to be deployed at scale, as specified. The bill would require the Energy Commission, in developing the strategy, to take certain actions, and would require that the strategy meet specified requirements. The bill would require the strategy adopted pursuant to these provisions to be included in the above-described integrated energy policy report.This bill would require the Energy Commission, on or before July 1, 2026, to complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions, as specified. The bill would require the Energy Commission to report the results of the study to the Legislature within 30 days of its completion.Existing law requires the Energy Commission, in consultation with the Public Utilities Commission and the Independent System Operator, to adopt a goal for load shifting to reduce net peak electrical demand and adjust this target in each biennial integrated energy policy report thereafter.This bill would require the Energy Commission, as part of the integrated energy policy report, to include modeling of the effects of virtual power plants on electricity costs and rate reduction and to submit to the Legislature a virtual power plant implementation plan that includes goals and milestones. The bill would require each electrical corporation to annually report to the commission Energy Commission its contribution towards meeting the that load-shift goal.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 25302.8 is added to the Public Resources Code, to read:25302.8.(a)As part of the report prepared pursuant to Section 25302, the commission shall do both of the following:(1)Include modeling of the effects of virtual power plants on electricity costs and rate reduction.(2)(A)Submit to the Legislature a virtual power plant implementation plan that includes goals and milestones.(B)The report submitted pursuant to subparagraph (A) shall be submitted in compliance with Section 9795 of the Government Code.(b)25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.SEC. 2. Chapter 6.6 (commencing with Section 25560) is added to Division 15 of the Public Resources Code, to read: CHAPTER 6.6. Virtual Power Plants25560. For purposes of this chapter, all of the following definitions apply:(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.(2) Hold no less than two public workshops to solicit public input on the development of the strategy.(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.(5) Includes recommendations on the compensation framework for virtual power plants.(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.(7) Maximizes cost savings to ratepayers.(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:(1) The avoided transmission, distribution, and generation costs.(2) The impacts on greenhouse gas emissions.(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.
Amended IN Assembly March 12, 2025 CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION Assembly Bill No. 740Introduced by Assembly Member HarabedianFebruary 18, 2025 An act to add Section 25302.8 to to, and to add Chapter 6.6 (commencing with Section 25560) to Division 15 of, the Public Resources Code, relating to energy. LEGISLATIVE COUNSEL'S DIGESTAB 740, as amended, Harabedian. Integrated energy policy report: virtual power plants. Virtual power plants: load shifting: integrated energy policy report.Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission), in consultation with specified entities, to adopt a biennial integrated energy policy report containing certain information, including an overview of major energy trends and issues facing the state. ExistingThis bill would require the Energy Commission, on or before November 1, 2026, to adopt a strategy to enable virtual power plants to be deployed at scale, as specified. The bill would require the Energy Commission, in developing the strategy, to take certain actions, and would require that the strategy meet specified requirements. The bill would require the strategy adopted pursuant to these provisions to be included in the above-described integrated energy policy report.This bill would require the Energy Commission, on or before July 1, 2026, to complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions, as specified. The bill would require the Energy Commission to report the results of the study to the Legislature within 30 days of its completion.Existing law requires the Energy Commission, in consultation with the Public Utilities Commission and the Independent System Operator, to adopt a goal for load shifting to reduce net peak electrical demand and adjust this target in each biennial integrated energy policy report thereafter.This bill would require the Energy Commission, as part of the integrated energy policy report, to include modeling of the effects of virtual power plants on electricity costs and rate reduction and to submit to the Legislature a virtual power plant implementation plan that includes goals and milestones. The bill would require each electrical corporation to annually report to the commission Energy Commission its contribution towards meeting the that load-shift goal.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NO
Amended IN Assembly March 12, 2025
Amended IN Assembly March 12, 2025
CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION
Assembly Bill
No. 740
Introduced by Assembly Member HarabedianFebruary 18, 2025
Introduced by Assembly Member Harabedian
February 18, 2025
An act to add Section 25302.8 to to, and to add Chapter 6.6 (commencing with Section 25560) to Division 15 of, the Public Resources Code, relating to energy.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
AB 740, as amended, Harabedian. Integrated energy policy report: virtual power plants. Virtual power plants: load shifting: integrated energy policy report.
Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission), in consultation with specified entities, to adopt a biennial integrated energy policy report containing certain information, including an overview of major energy trends and issues facing the state. ExistingThis bill would require the Energy Commission, on or before November 1, 2026, to adopt a strategy to enable virtual power plants to be deployed at scale, as specified. The bill would require the Energy Commission, in developing the strategy, to take certain actions, and would require that the strategy meet specified requirements. The bill would require the strategy adopted pursuant to these provisions to be included in the above-described integrated energy policy report.This bill would require the Energy Commission, on or before July 1, 2026, to complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions, as specified. The bill would require the Energy Commission to report the results of the study to the Legislature within 30 days of its completion.Existing law requires the Energy Commission, in consultation with the Public Utilities Commission and the Independent System Operator, to adopt a goal for load shifting to reduce net peak electrical demand and adjust this target in each biennial integrated energy policy report thereafter.This bill would require the Energy Commission, as part of the integrated energy policy report, to include modeling of the effects of virtual power plants on electricity costs and rate reduction and to submit to the Legislature a virtual power plant implementation plan that includes goals and milestones. The bill would require each electrical corporation to annually report to the commission Energy Commission its contribution towards meeting the that load-shift goal.
Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission), in consultation with specified entities, to adopt a biennial integrated energy policy report containing certain information, including an overview of major energy trends and issues facing the state. Existing
This bill would require the Energy Commission, on or before November 1, 2026, to adopt a strategy to enable virtual power plants to be deployed at scale, as specified. The bill would require the Energy Commission, in developing the strategy, to take certain actions, and would require that the strategy meet specified requirements. The bill would require the strategy adopted pursuant to these provisions to be included in the above-described integrated energy policy report.
This bill would require the Energy Commission, on or before July 1, 2026, to complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions, as specified. The bill would require the Energy Commission to report the results of the study to the Legislature within 30 days of its completion.
Existing law requires the Energy Commission, in consultation with the Public Utilities Commission and the Independent System Operator, to adopt a goal for load shifting to reduce net peak electrical demand and adjust this target in each biennial integrated energy policy report thereafter.
This bill would require the Energy Commission, as part of the integrated energy policy report, to include modeling of the effects of virtual power plants on electricity costs and rate reduction and to submit to the Legislature a virtual power plant implementation plan that includes goals and milestones. The bill would require each electrical corporation to annually report to the commission Energy Commission its contribution towards meeting the that load-shift goal.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 25302.8 is added to the Public Resources Code, to read:25302.8.(a)As part of the report prepared pursuant to Section 25302, the commission shall do both of the following:(1)Include modeling of the effects of virtual power plants on electricity costs and rate reduction.(2)(A)Submit to the Legislature a virtual power plant implementation plan that includes goals and milestones.(B)The report submitted pursuant to subparagraph (A) shall be submitted in compliance with Section 9795 of the Government Code.(b)25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.SEC. 2. Chapter 6.6 (commencing with Section 25560) is added to Division 15 of the Public Resources Code, to read: CHAPTER 6.6. Virtual Power Plants25560. For purposes of this chapter, all of the following definitions apply:(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.(2) Hold no less than two public workshops to solicit public input on the development of the strategy.(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.(5) Includes recommendations on the compensation framework for virtual power plants.(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.(7) Maximizes cost savings to ratepayers.(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:(1) The avoided transmission, distribution, and generation costs.(2) The impacts on greenhouse gas emissions.(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 25302.8 is added to the Public Resources Code, to read:25302.8.(a)As part of the report prepared pursuant to Section 25302, the commission shall do both of the following:(1)Include modeling of the effects of virtual power plants on electricity costs and rate reduction.(2)(A)Submit to the Legislature a virtual power plant implementation plan that includes goals and milestones.(B)The report submitted pursuant to subparagraph (A) shall be submitted in compliance with Section 9795 of the Government Code.(b)25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.
SECTION 1. Section 25302.8 is added to the Public Resources Code, to read:
### SECTION 1.
25302.8.(a)As part of the report prepared pursuant to Section 25302, the commission shall do both of the following:(1)Include modeling of the effects of virtual power plants on electricity costs and rate reduction.(2)(A)Submit to the Legislature a virtual power plant implementation plan that includes goals and milestones.(B)The report submitted pursuant to subparagraph (A) shall be submitted in compliance with Section 9795 of the Government Code.(b)25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.
(a)As part of the report prepared pursuant to Section 25302, the commission shall do both of the following:
(1)Include modeling of the effects of virtual power plants on electricity costs and rate reduction.
(2)(A)Submit to the Legislature a virtual power plant implementation plan that includes goals and milestones.
(B)The report submitted pursuant to subparagraph (A) shall be submitted in compliance with Section 9795 of the Government Code.
(b)
25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.
25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.
25302.8. Each electrical corporation corporation, as defined in Section 218 of the Public Utilities Code, shall annually report to the commission its contribution towards meeting the load-shift goal adopted pursuant to Section 25302.7.
SEC. 2. Chapter 6.6 (commencing with Section 25560) is added to Division 15 of the Public Resources Code, to read: CHAPTER 6.6. Virtual Power Plants25560. For purposes of this chapter, all of the following definitions apply:(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.(2) Hold no less than two public workshops to solicit public input on the development of the strategy.(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.(5) Includes recommendations on the compensation framework for virtual power plants.(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.(7) Maximizes cost savings to ratepayers.(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:(1) The avoided transmission, distribution, and generation costs.(2) The impacts on greenhouse gas emissions.(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.
SEC. 2. Chapter 6.6 (commencing with Section 25560) is added to Division 15 of the Public Resources Code, to read:
### SEC. 2.
CHAPTER 6.6. Virtual Power Plants25560. For purposes of this chapter, all of the following definitions apply:(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.(2) Hold no less than two public workshops to solicit public input on the development of the strategy.(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.(5) Includes recommendations on the compensation framework for virtual power plants.(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.(7) Maximizes cost savings to ratepayers.(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:(1) The avoided transmission, distribution, and generation costs.(2) The impacts on greenhouse gas emissions.(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.
CHAPTER 6.6. Virtual Power Plants25560. For purposes of this chapter, all of the following definitions apply:(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.(2) Hold no less than two public workshops to solicit public input on the development of the strategy.(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.(5) Includes recommendations on the compensation framework for virtual power plants.(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.(7) Maximizes cost savings to ratepayers.(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:(1) The avoided transmission, distribution, and generation costs.(2) The impacts on greenhouse gas emissions.(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.
CHAPTER 6.6. Virtual Power Plants
CHAPTER 6.6. Virtual Power Plants
25560. For purposes of this chapter, all of the following definitions apply:(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.
25560. For purposes of this chapter, all of the following definitions apply:
(a) Smart means a device or appliance that adjusts its energy use, is internet connected, is able to be controlled remotely, with explicit customer consent, by the consumer, the manufacturer, or an aggregator, provides information about its operating status, and enables the customer to enable or disable the smart features.
(b) Virtual power plant means an actively coordinated aggregation of behind-the-meter distributed energy resources, including, but not limited to, electric vehicles and chargers, electric water heaters, smart thermostats, smart plugs, smart buildings and their controls, battery storage systems like those installed with rooftop solar systems, and flexible commercial and industrial loads, that are dispatchable and can balance electricity demand and supply and reduce or shift demand.
25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.(2) Hold no less than two public workshops to solicit public input on the development of the strategy.(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.(5) Includes recommendations on the compensation framework for virtual power plants.(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.(7) Maximizes cost savings to ratepayers.(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.
25561. (a) On or before November 1, 2026, the commission, at a publicly noticed voting meeting, shall adopt a strategy, with milestones, to enable virtual power plants to be deployed at scale.
(b) In developing the strategy adopted pursuant to subdivision (a), the commission shall do all of the following:
(1) Consult and collaborate with the Public Utilities Commission, the Independent System Operator, and the disadvantaged community advisory group established pursuant to Section 400 of the Public Utilities Code.
(2) Hold no less than two public workshops to solicit public input on the development of the strategy.
(3) Convene stakeholder sessions to solicit input from organizations representing industry, the affected workforce, ratepayer organizations, consumer organizations, load-serving entities, as defined in Section 380 of the Public Utilities Code, and local publicly owned electric utilities, as defined in Section 224.3 of the Public Utilities Code.
(c) The commission shall ensure that the strategy adopted pursuant to subdivision (a) does all of the following:
(1) Estimates the size of the resource potential of virtual power plant resources by 2030, 2035, and 2045.
(2) Identifies the existing and potential policy and regulatory barriers and opportunities for virtual power plant resources to qualify for or reduce resource adequacy obligations.
(3) Includes a recommended pathway and policy and regulatory changes to resolve the policy and regulatory barriers identified in paragraph (2).
(4) Includes an assessment of virtual power plant resources that are currently eligible for resource adequacy pursuant to Section 380 of the Public Utilities Code, and estimates of how this resource type would change if the policy changes identified in paragraph (3) are made.
(5) Includes recommendations on the compensation framework for virtual power plants.
(6) Assesses the barriers to data access necessary for the creation and operation of virtual power plants at scale and recommended ways to address them.
(7) Maximizes cost savings to ratepayers.
(d) The strategy adopted pursuant to subdivision (a) shall be included in the report prepared pursuant to Section 25302.
25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:(1) The avoided transmission, distribution, and generation costs.(2) The impacts on greenhouse gas emissions.(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.
25562. (a) On or before July 1, 2026, the commission shall complete a study that includes 2030, 2035, and 2045 scenarios of the effects of virtual power plant deployment at scale on electrical system costs, rate reduction, and the reduction of greenhouse gas emissions. The study shall include, but not be limited to, both of the following:
(1) The avoided transmission, distribution, and generation costs.
(2) The impacts on greenhouse gas emissions.
(b) (1) The commission shall report the results of the study to the Legislature within 30 days of its completion.
(2) The report submitted pursuant to paragraph (1) shall be in compliance with Section 9795 of the Government Code.