PG&E Launches $200 mn Microgrid Incentive Program to Boost Clean Energy Resilience in California

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Pacific Gas and Electric Company (PG&E) has unveiled its Microgrid Incentive Program (MIP), a groundbreaking initiative offering financial support for community, local, and tribal government-proposed multi-customer microgrids.

The MIP, a statewide competitive grant program with a budget of $200 million, is set to fuel the development of clean-energy community microgrids in disadvantaged and vulnerable communities across California.

The California Public Utilities Commission has greenlit this pioneering program, allocating $79.2 million in project funding for PG&E, $83.3 million for Southern California Edison, and $17.5 million for San Diego Gas and Electric. Projects selected under the MIP stand to receive up to $15 million in award funding for the design and development of multi-customer, front-of-the-meter community microgrids.

A community microgrid, defined as a cluster of customers and distributed energy resources like solar arrays and batteries within specific electrical boundaries, possesses the critical capability to disconnect, operate independently from the grid, and reconnect when necessary.

These microgrids significantly bolster community resilience by ensuring reliable power during outages or emergencies. Moreover, they facilitate efficient energy management, potential cost savings, integration of renewable energy, and a reduction in greenhouse gas emissions.

Distributed energy resources within a community microgrid can also participate in the statewide wholesale energy market, creating a potential revenue stream for asset owners and further stabilizing the California grid.

MIP operates alongside PG&E’s Community Microgrid Enablement Program (CMEP). These initiatives provide comprehensive financial and technical support for distributed energy resources and associated costs vital for the development and activation of eligible microgrids, including necessary upgrades to the electric distribution system enabling safe islanding.

Redwood Coast Airport Microgrid, the inaugural fully renewable, multi-customer microgrid deployed in PG&E’s service area, serves as a model for future microgrids in California. Its development also gave rise to the Community Microgrid Enablement Tariff.

Since 2021, PG&E has engaged with over three dozen communities to explore financial and infrastructure support options for developing microgrids through the CMEP. PG&E prioritizes technical and financial assistance for qualifying projects in areas with the most pressing energy resilience needs.