September 25, 2025
Leap’s energy market experts share their latest updates and insights for distributed energy resources (DER) technology providers on the ever-evolving policy and regulatory landscape.
Featured
California Legislature Makes Big Moves on Energy Policy
California’s final 2025 legislative session brought mixed outcomes for the DER industry. While lawmakers failed to secure dedicated funding for the Demand Side Grid Support (DSGS) program, they did advance several important clean energy measures, including:
AB 740: Directs the CEC to create identify barriers to VPP deployment and develop an action plan to expand their use in California.
AB 825: Grants CAISO permission to join a regional energy market, which will eventually expand the use of CAISO-integrated VPPs to other western states.
AB 105: Allocates $46M to the Distributed Energy Backup Asset program, a CEC-run program the provides upfront funding to grid assets like DERs.
These actions indicate that legislative support for clean energy generally—and VPPs specifically—is still strong in California.
Leap has now turned our attention to ensuring that this legislature acts on existing pathways to allocate funding to DSGS in the 2026-2027 budget cycle. We've scheduled a series of meetings in Sacramento with key legislators to discuss importance of DSGS to the future of California's energy market; these will be critical opportunities to demonstrate the broad coalition of industry support behind DSGS. Please email us if you are interested in taking action to support these efforts.
Don’t Pull the Plug on California’s VPP Breakthrough
Post-OBBB, VPPs are Primed to Meet New Energy Challenges
Prescriptive Baselines: A Good Idea Whose Time Has Come
From the Blog
On our radar
CPUC Creates New Rulemaking to Resolve DR Regulatory Issues
The CPUC’s September 18th business meeting agenda included an exciting new addition: an Order Instituting Rulemaking (OIR) to open a new proceeding specifically focused on outstanding regulatory issues hindering California’s use of demand response. The draft scope includes a number of important topics, including dual participation between different programs, valuation methodologies, CAISO market integration topics, and data transfer processes. Leap will be actively engaging to shape the scope and outcomes of this presentation, which is scheduled to run for two years.
PJM capacity auction clears at record capacity prices
PJM’s 2026/27 Base Residual Auction took place in July and cleared at $329/MW-Day, an all-time high for the broader RTO region, which dates back to 2007/08. This was at the maximum possible price after PJM implemented a “price collar” to limit both upside and downside for the next two capacity auctions due to concerns over ratepayer impacts of high capacity prices.
The surge in prices has been driven primarily by two factors: rapid load growth—forecasted to exceed 5 GW between 2025 and 2026—and a reduction in the capacity credits awarded to natural gas plants. Looking ahead, prices are expected to remain elevated through the late 2020s as demand continues to rise and the addition of new front-of-the-meter capacity faces significant delays.
Leap is ready to help your DERs tap into this hot market! Join our webinar coming up on Wednesday, 10/1 to learn about our PJM offerings and platform capabilities.
