SB 913 requires the California Public Utilities Commission to change how aggregated distributed capacity resources (collections of behind-the-meter generation, storage, and demand reductions) qualify for resource adequacy. It charges the commission with aligning counting conventions, settlement methods, privacy and enrollment rules, and coordination with the California Energy Commission and the California Independent System Operator so these aggregated resources can compete as capacity.
The bill matters because it shifts more of the state’s capacity supply picture toward aggregated distributed resources by removing administrative and measurement barriers, enabling nontraditional providers and customer-sited devices to participate in resource adequacy procurement. That could expand capacity supply, alter procurement behavior by load-serving entities, and require operational and market changes at utilities and the ISO.
At a Glance
What It Does
Directs the commission, working with the Energy Commission and ISO, to adopt rules that let aggregated distributed capacity resources qualify for local, system, or flexible resource adequacy and receive full capacity credit, including exported energy. It requires device-level measurement standards, allows settlement using device telemetry (rather than always requiring revenue-grade meters), authorizes multiple enrollment behind one utility meter, and directs the commission to request ISO market-model changes.
Who It Affects
Aggregators and developers of distributed energy resources (DERs), load‑serving entities (investor‑owned utilities, community choice aggregators), the California Independent System Operator, device manufacturers and telemetry providers, and customers with DERs or enrolled behind-the-meter devices.
Why It Matters
By changing measurement, enrollment, and settlement rules, the bill lowers barriers for DERs to compete in resource adequacy markets, reshaping procurement options and potentially reducing capacity costs — but it also forces system operators and utilities to redesign operations and data flows to manage performance, privacy, and double‑compensation risks.
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What This Bill Actually Does
SB 913 focuses on three operational levers to bring aggregated distributed capacity resources (ADCRs) into California’s resource adequacy construct: how capacity is measured and credited, how devices are enrolled and data are accessed, and how market participation models align with the ISO. The bill directs the commission to produce standardized, reasonable requirements so that devices meeting those standards can be settled using device telemetry rather than mandating revenue‑grade meters across the board.
That lowers metering costs for aggregators while creating an expectation that device‑level measurements will be reliable enough to be treated as RA capacity.
The bill explicitly says ADCRs must be eligible for local, system, or flexible RA capacity and requires credit for full capacity value — including net exports measured past the utility meter. It allows aggregations to include heterogeneous resources and to combine load reductions and net exports during any hour, and it places the burden on the aggregator to demonstrate aggregate deliverability (weather normalized where feasible).
To reduce enrollment friction, the commission is instructed to permit opt‑out enrollment structures and streamlined data access processes consistent with state law and industry best practices, while guarding consumer privacy without imposing overly burdensome login or meter‑level requirements that would stifle growth.SB 913 also protects competitive entry and procurement flexibility: load‑serving entities may include ADCRs in RA filings and commission‑ordered procurement, and the commission must avoid procurement rules that lock LSEs into traditional resource types where ADCRs could meet needs. The bill prohibits restrictions that prevent non‑LSE entities from developing or managing ADCRs, so third‑party aggregators can offer capacity into procurement markets.
Finally, the commission must develop and send recommendations to the ISO for changes to proxy demand resource and aggregation participation models — including must‑offer obligations — so market rules and the ISO’s participation templates work with the new counting and settlement approach.
The Five Things You Need to Know
The commission must complete its enhancements and coordination with the Energy Commission and ISO on ADCR pathways by June 30, 2027.
ADCRs are eligible to receive resource adequacy credit for full capacity value, explicitly including energy exported past the utility meter (net exports).
The bill authorizes settlement using device telemetry for distributed resources that meet standardized requirements, removing a universal requirement for revenue‑grade meters.
Multiple enrollment is permitted so multiple devices can participate behind the same utility point of interconnection, provided the same load reduction or export is not compensated twice.
By June 30, 2027 the commission must recommend changes to the ISO’s proxy demand resource and distributed energy resource aggregation participation models, including must‑offer obligations, and request ISO implementation via a new or existing initiative.
Section-by-Section Breakdown
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Commission directive and coordination
This subsection directs the California Public Utilities Commission to enhance market‑integrated pathways for aggregated distributed capacity resources, coordinating with the Energy Commission and the ISO. Practically, it sets a cross‑agency work requirement to align counting methodologies, settlement approaches, and participation rules so ADCRs can qualify for local, system, or flexible RA capacity. The coordination language matters because changes touch procurement policy (CPUC), resource planning and standards (CEC), and market participation and operations (CAISO).
Eligibility, full credit, device‑level measurement, and heterogeneity
These subsections require that ADCRs be allowed to qualify under any qualifying or successor RA methodology, receive full capacity credit (including exports), and be measured at the device level with weather normalization where feasible. They explicitly permit aggregated resources to mix technologies and to count both load reductions and net exports during any hour. The practical implication is a shift away from resource‑type exclusions toward performance‑based, technology‑neutral capacity determinations; aggregators will need to prove aggregate deliverability rather than rely on resource labels.
Settlement, multiple enrollment, and data/privacy rules
The bill directs the commission to adopt reasonable and standardized requirements allowing settlement using device telemetry for devices that qualify, instead of requiring revenue‑grade meters for every device. It authorizes multiple enrollment behind a single utility point of interconnection — including for participation in separate programs — but conditions that on preventing duplicate compensation. The subsection on privacy instructs the commission to avoid unduly burdensome data access requirements (like mandatory utility logins) and to permit opt‑out enrollment and streamlined authorization processes consistent with state law and best practices, reducing administrative barriers for mass enrollment.
Inclusion in RA filings and procurement non‑discrimination
These provisions require the CPUC to permit load‑serving entities to include ADCRs in RA filings and in commission‑ordered procurement, and to ensure procurement rules do not favor traditional resources over ADCRs unless specific attributes (e.g., multi‑day storage, clean firm) are necessary. The commission must provide reasonable flexibility in contract terms to accommodate the different characteristics of ADCRs and must not restrict non‑LSE entities from developing or managing ADCRs, protecting third‑party aggregator market access.
ISO market alignment and definitions
By the same June 30, 2027 timeframe, the CPUC must recommend changes to the ISO’s proxy demand resource and DER aggregation participation models — including must‑offer obligations — and request ISO action through an initiative. The section closes with definitions clarifying an ADCR as an aggregation of distributed resources and references the statutory meaning of load‑serving entity, which ties this new construct into existing RA terminology and processes.
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Explore Energy in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- Aggregators and third‑party DER developers — They gain clearer pathways to monetize aggregated behind‑the‑meter assets in RA markets, lower metering costs through telemetry settlement, and the ability to combine heterogeneous resources to meet capacity bids.
- Customers with DERs (resilience/storage owners, solar+storage households) — They can access additional revenue streams for exports and demand reductions without requiring costly revenue‑grade meters, and opt‑out enrollment can simplify participation.
- Load‑serving entities (CCAs, IOUs) — They gain a broader set of procurement options to meet RA obligations and may lower capacity costs by tapping distributed resources that compete on performance and price.
Who Bears the Cost
- Utilities and balancing/settlement systems — They must modify metering, telemetry ingestion, settlement platforms, and billing processes and manage increased data flows and enrollment complexities.
- Aggregators and ADCR providers — Although telemetry reduces metering capital costs, they take on deliverability performance risk, compliance obligations, and costs to meet standardized telemetry and measurement requirements.
- California ISO and market operators — The ISO must redesign participation models, implement recommended changes to proxy demand resource rules and must‑offer obligations, and manage operational integration and potential reliability impacts during transition.
Key Issues
The Core Tension
The central tension is between maximizing participation and competition from distributed resources by relaxing measurement and enrollment barriers, and preserving the integrity and reliability of resource adequacy through rigorous measurement, settlement accuracy, and privacy protections — a trade‑off between rapid DER market growth and the operational/market safeguards needed to ensure capacity delivers when called upon.
SB 913 pushes California toward a performance‑based RA model that maximizes participation from distributed resources, but it leaves several implementation details unresolved. The bill authorizes telemetry settlement for qualifying devices but does not specify the technical or cybersecurity standards those telemetry streams must meet; the CPUC will need to define precision thresholds, latency, verification, and audit processes to prevent measurement errors and market gaming.
Similarly, permitting opt‑out enrollment and streamlined data access accelerates participation but creates potential tension with existing privacy laws and utility data governance; the CPUC must reconcile streamlined processes with data security, consent, and utility operational needs.
The bill also trades attribute specificity for broader competition: it requires procurement flexibility so ADCRs aren’t excluded in favor of traditional resources, but it acknowledges that some attributes (clean firm, multi‑day storage) may legitimately require specific procurement. That creates a policy line that will be hard to draw in practice — regulators must decide when an RA product truly requires resource‑type attributes versus when performance can substitute.
Finally, coordination with the ISO to change market models (including must‑offer obligations) is necessary but operationally fraught; changes to offer obligations, verification, and settlement timelines will affect market price formation and real‑time operations, and the bill leaves the detailed sequencing and cost allocation of those market changes to future CPUC‑ISO processes.
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