The California Energy Commission on April 10 approved revised guidelines for a reliability program after the state’s utility regulator in March said the effort could undermine certain benefits of a separate reliability program run by Pacific Gas and Electric (PG&E). 

The CEC program in question — the Demand Side Grid Support (DSGS) program — is part of the agency’s Strategic Reliability Reserve (SRR) initiative, developed in 2022 as part of Assembly Bill 205. When the DSGS began in 2022, participants contributed 315 MW to help meet grid needs during a summer 2022 heat wave. 

In March, the CEC planned to approve revised DSGS program guidelines, but held off on the decision due to a California Public Utilities Commission letter to the CEC saying the revised guidelines “overlap substantially” with PG&E’s Automated Response Technology (ART) program. 

The DSGS targets the same market segments and devices and is “likely to undermine the new resource adequacy benefits and other goals of the market-integrated ART program,” Leuwam Tesfai, CPUC deputy executive director for energy and climate policy, said in the letter.  

PG&E’s ART program has begun enrolling customers and has capacity commitments under contract, Tesfai said. 

The CPUC was specifically concerned that DSGS’s Option 4, the Emergency Load Flexibility virtual power plant (VPP) pilot, conflicted with ART. The revised DSGS therefore excludes PG&E distribution service customers from participation in Incentive Option 4.  

If a participant joins a conflicting program, such as ART, the participant’s DSGS provider will be notified, and the participant will be suspended indefinitely until the conflict is resolved, the guidelines say. 

In the DSGS, entities such as publicly owned electric utilities (POUs) and community choice aggregators (CCAs) are eligible to serve as load flexibility VPP aggregators, the revised guidelines say. A load flexibility VPP event contains up to two core hours, which are the peak price hours defined as the two consecutive hours in the daily availability window with the highest mean CAISO energy price, the guidelines say. 

Stakeholders raised concerns with the delay in approving the guidelines, saying waiting interferes with providers’ and participants’ plans for program participation for 2025. 

“It is especially concerning that the CPUC requested a delay on the date of the business meeting at which approval was to happen, given that the proposal to add Option 4 was publicly available and the CEC invited input beginning in October 2024,” Kate Unger, senior policy adviser at the California Solar & Storage Association, said in a March 21 letter to the CEC. “PG&E and the CPUC had sufficient opportunity to raise concerns about the ART program throughout the revision process this year.” 

CEC Approves Air Capture Grants

At the meeting, the CEC also approved three grants for companies working on direct air capture (DAC) methods. A major issue with DACs is that they require a large amount of water: 1.6 tons of water per ton of CO2 captured for most commercial DAC systems, according to the CEC. To help solve this issue, the CEC awarded Circularity Fuels funding to improve its technology by eliminating the need for steam (and thus water). The project will also help the company demonstrate scalability from 5-kW to 50-kW systems and validate the product’s performance in real-world conditions. 

The second grant went to Noya, an Oakland-based company, to improve its product’s materials and CO2 regeneration. The third and final grant went to Berkeley-based AirCapture, allowing the company to design, develop and test a DAC system that uses microwave energy for sorbent regeneration.