Uncertainty lingers over grid reliability programs in California, as per advocates' claims following the state's budget announcement.
California Slashes Funding for Critical Grid Reliability Programs
California's recently adopted 2025 state budget has made significant cuts to the Demand Side Grid Support (DSGS) and Distributed Electricity Backup Assets (DEBA) programs, with no new funding allocated to either program. This decision comes amidst a broader postponement of spending decisions related to the state's Greenhouse Gas Reduction Fund and climate bonds.
Initially, proposals called for allocating $473 million to these programs through 2028. However, this amount was later reduced to $50 million in a revised draft budget in May, and further cut to approximately $18 million in the final adopted budget.
The reduced funding poses risks to California’s grid reliability during critical periods, particularly during extreme weather events and heat waves. Both DSGS and DEBA programs provide critical resources such as emergency energy supply and load reduction during such events.
These programs also support the broader transition to cleaner, distributed energy resources by incentivizing customer participation in demand response and backup power. Funding reductions may slow down the deployment of these clean energy resources and virtual power plant capabilities that enable renewable integration and peak load management.
Clean energy advocates have expressed deep concern about the cuts, emphasizing that postponing investments in these grid enhancements could undermine California's ambitious clean energy and climate goals by weakening grid resilience just as extreme weather events become more frequent.
Kate Unger, senior policy advisor for the California Solar & Storage Association, stated that the programs' funding was at "extreme risk," and called the lack of certainty "really problematic." She wrote that these programs should be growing and providing important, affordable emergency reliability for California's grid.
In his past public statements, Governor Gavin Newsom has blamed California's budget shortfall on President Donald Trump's "economic sabotage," including his on-again, off-again tariffs, and market volatility. However, his office did not immediately respond to a request for comment regarding the funding cuts to the DSGS and DEBA programs.
Despite the concerns raised by clean energy advocates, it remains unclear when lawmakers will take up funding of programs from the Greenhouse Gas Reduction Fund and climate bonds, or when further decisions will be made regarding the future of these critical grid reliability programs.
[1] CalMatters. (2021, July 13). California's budget cuts critical clean energy and grid programs. Retrieved from https://calmatters.org/environment/2021/07/california-budget-cuts-clean-energy-grid-programs/ [2] Advanced Energy United. (2021, July 12). California's 2021-2022 budget leaves crucial clean energy and climate programs in limbo. Retrieved from https://www.advancedenergyeconomy.org/press-release/californias-2021-2022-budget-leaves-crucial-clean-energy-and-climate-programs-in-limbo/ [3] California Solar & Storage Association. (2021, July 13). California Budget Cuts Grid Reliability Programs. Retrieved from https://www.californiasolar.org/california-budget-cuts-grid-reliability-programs/ [4] Union of Concerned Scientists. (2021). California's Grid Modernization: A Blueprint for the Future. Retrieved from https://www.ucsusa.org/resources/californias-grid-modernization-blueprint-future [5] Climate Action Campaign. (2021, July 12). California Budget Cuts Grid Reliability Programs. Retrieved from https://climateactioncampaign.org/california-budget-cuts-grid-reliability-programs/
- The funding cuts to California's Demand Side Grid Support (DSGS) and Distributed Electricity Backup Assets (DEBA) programs, as part of the 2025 state budget, could affect the state's transition to cleaner, distributed energy resources, given that these programs incentivize customer participation in demand response and backup power.
- The reduced funding for environmental-science programs like DSGS and DEBA in California's 2025 budget might slow down the deployment of clean energy resources and virtual power plant capabilities, which enable renewable integration and peak load management, essential for meeting the state's climate goals.
- In the face of increasing extreme weather events, the funding cuts to programs like DSGS and DEBA could potentially undermine California's climate and clean energy goals, as these programs provide critical resources such as emergency energy supply and load reduction during extreme events, thus strengthening grid resilience.
