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California has made decarbonization a priority. Legislation and funding are pushing the state to a carbon-free future. A significant portion of the effort is allocated to building electrification. Buildings use a tremendous amount of energy. The energy source in the future for buildings will be electricity procured from carbon-free, renewable sources.

One of the main concerns of switching to electricity in place of fossil fuels is the impact on the electrical distribution grid. The state’s policymakers are aware of this concern and are exploring several ways to mitigate the impacts.

On October 12, 2022, the California Energy Commission (CEC) adopted new load management standards.Electricity demand fluctuates dramatically based on a multitude of factors. For example: when there is extreme heat, the demand increases due to the number of air conditioners in use. In the wee hours of the morning, demand drops off as most of us are asleep. In California, managing these loads is the responsibility of The California Independent System Operator (CAISO), an independent third-party provider.

Managing loads helps avoid the construction of new power-generating facilities and ensures consumers will have electricity when needed. Another aspect of load management is supporting efforts to reduce demand during peak usage periods. California’s demand for electricity is most significant between the hours of 4:00 pm and 9:00 pm. 

There are multiple ways to reduce peak loads, such as waiting until after 9:00 pm to run your dishwasher. Another is investing in Energy Efficiency (EE) upgrades, which are very effective at reducing peak loads. Reducing loads on the grid is quickly becoming one of the most valuable benefits of EE upgrades in building codes and remodeling projects.

The new management standards will provide much more flexibility for utilities and community choice aggregators. Allowing customers to have choices about their retail electricity rates, greater access to utility bill information, and the ability to provide time-varying rates based on statewide demands are just a few of the new amendments outlined in the new standards.

The goal is to create greater flexibility in the grid and rate structures to reflect the reality of today’s electrical distribution grid. Gone are the days of generating the power at the plant and sending it one way to the end user. Today’s grid needs to integrate multiple generation sources and rapidly adjust supply based on actual demand. In creating these new grid standards, the CEC will reduce summer peak loads, increase reliability, reduce costs to the consumer, and provided energy use data to consumers and third-parties. 

It’s refreshing to know that the CEC is working to make the grid, and rate structures, reflect the realities of the clean energy future.