California PUC seeks to enable widespread demand flexibility through electric rates
On Thursday, the California Public Utilities Commission (CPUC) announced it had approved the opening of a new public process that would seek to enable widespread demand flexibility through electric rates.
Officials said the move recognizes the importance of demand-side strategies in meeting the state’s climate and reliability goals. The concept of demand flexibility would allow consumers to play a role in the operation of the state’s electric grid by reducing or shifting their electricity usage during peak use periods in response to pricing or other incentives.
“This Demand Flexibility proceeding opens the door to considering a more holistic, streamlined approach to rate design and load management strategies,” said CPUC President Alice Reynolds. “Creative approaches to customer demand management can help to ensure reliability, increase affordability, support equitable rates, and reduce greenhouse gas emissions, taking us further on the path toward meeting our ambitious climate goals.”
Through a procedure opened on Thursday, the CPUC will consider demand flexibility policies and modifications of electric rates to enhance the state’s electric systems reliability; make electric bills more affordable and equitable; reduce the curtailment of renewable and energy and greenhouse gas emissions associated with meeting the state’s future load; enabling widespread building and transportation electrification; reducing long-term system costs through more efficient pricing; and enable customer participation in demand flexibility.
“The Demand Flexibility proceeding is an important step towards designing the advanced future grid in California,” said Commissioner Darcie L. Houck. “Demand flexibility has the potential to enhance and accelerate the state’s energy and climate goals, renewable integration, and high distributed energy resources adoption. It also plays a critical role in improving grid reliability and resiliency, reducing grid emissions, and making electricity rates more affordable and equitable.”
CPUC said the proceeding brings many facets of load management approaches under one umbrella as a way to increase and improve the growth and effectiveness of demand flexibility while allowing stakeholders to consider how demand flexibility guidance principles, policies, rates, tools, and other programs can support equitable and affordable rates for all Californians.
