California’s Demand Side Grid Support Program Grows to 500 Megawatts of Capacity
For Immediate Release: October 15, 2024
One of the world’s largest storage virtual power plants is among more than 500 MW of electricity resources enrolled in a state program that provides backup power during extreme events. The program leveraged existing clean energy assets to help stabilize California’s grid during four separate heatwaves this summer.
SACRAMENTO – The California Energy Commission’s (CEC) Demand Side Grid Support (DSGS) program has successfully enrolled 515 megawatts (MW) of capacity, with over 265,000 participants contributing to the state's efforts to maintain a clean, reliable energy grid during extreme climate-driven events.
Launched in August 2022, the DSGS program is part of California’s Strategic Reliability Reserve of backup energy resources that serve as an insurance policy when the power grid is strained during extreme events when demand is high. The DSGS program, which runs May through October, works by incentivizing enrolled Californians to reduce electricity usage or send energy to the grid when conditions are tight.
The program includes one of the largest storage virtual power plants in the world with a capacity exceeding 200 MW. The virtual power plant works by tapping into a network of customer-owned battery storage systems, which are typically paired with solar. Together, the individual devices provide power back to the grid.
By leveraging existing energy assets, the program helps reduce California's reliance on fossil fuels, supporting the state’s clean energy future and contributing to an equitable energy system.
“As the effects of climate change become more pronounced, innovative programs like DSGS provide a critical buffer for ensuring the reliability of California’s electrical grid, while reducing emissions,” said CEC Vice Chair Siva Gunda.
Participants are paid based on the net load reduction they provide, with some earning $2 per kilowatt-hour of energy shared with the grid.
The resources used to reduce electricity demand on the grid varies based on the program option in which the participant is enrolled:
- Option 1: Non-combustion resources (such as traditional demand response)
- Option 2: Demand response aggregators participating in CAISO market
- Option 3: Storage virtual power plant
So far in the 2024 program season, the virtual power plant (Option 3) has been activated 16 times and Option 1 (demand response only) has activated once, helping to avoid a grid crisis during four separate heatwaves from July through the beginning of October.
In its first year of operation, the DSGS program demonstrated its value during the September 2022 heatwave, reducing over 3,000 megawatt-hours (MWh) of electricity demand throughout the 10-day event. Performance figures for the 2024 season will be available later this year.
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About the California Energy Commission
The California Energy Commission is the state's primary energy policy and planning agency. It has seven core responsibilities: advancing state energy policy, encouraging energy efficiency, certifying thermal power plants, investing in energy innovation, developing renewable energy, transforming transportation, and preparing for energy emergencies.
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