ACC News Brief
Energy Policy California, United States
Reported budget outcome — the program remains active in 2026 and 2027 funding is not guaranteed
California budget leaves a major virtual power plant without guaranteed 2027 funding
What happened
Canary Media reports that final state budget language did not authorize additional 2027 funding for California's Demand Side Grid Support program. The same negotiations did not move the program away from the California Energy Commission or abolish it. The program pays participating homes and businesses to reduce demand or discharge stored solar power during grid stress; the article attributes roughly 130,000 battery homes, 75,000 flexible-load homes, and a 476-megawatt two-hour July 2025 battery test to program participants and supporters.
ACC context
ACC distinguishes the absence of new 2027 authorization from cancellation. Program-scale and performance figures remain attributed to the organizations cited in the reporting until a complete independent program evaluation is available.
Why it matters
Distributed batteries, thermostats, electric vehicles, and other flexible loads can help meet peak demand, but programs need stable rules, verified performance, and durable funding. The reporting documents a budget outcome and immediate uncertainty—not the end of the program, a final 2027 policy, or proof that every claimed capacity figure will be available when needed.
What to watch
- Whether lawmakers and the next administration provide 2027 funding or revise the program early next year.
- Participant retention, enrollment, measured event performance, customer payments, and independently assessed grid value.
- How California compares customer-side flexibility with utility generation, storage, transmission, and other reliability investments.
Sources & evidence
- California declines to fund its biggest virtual power plantCanary Media report dated September 1, 2026, describing final budget language, the absence of guaranteed 2027 DSGS funding, and the program's continued placement at the California Energy Commission. Participation and capacity figures are attributed to cited program supporters and companies.
- Demand Side Grid Support Program Guidelines, Fifth EditionCalifornia Energy Commission program guidelines published in 2026. They document the operating framework but do not establish that 2027 funding has been approved.
Continue learning with ACC
See how storage, flexible demand, and transmission support a cleaner grid
