Why Resource Adequacy matters to industrial customers
Resource Adequacy (RA) is the California Public Utilities Commission (CPUC) program that requires load-serving entities to procure enough capacity to keep the grid reliable. For CLECA's members — steel mills, cement plants, glass and industrial-gas producers, and other heavy manufacturers with a combined load on the order of five hundred megawatts — RA rules determine both what they pay for reliability and how the grid values the curtailable load they provide back to it.
CLECA accepts that California needs a reformed RA program, including the 24-hourly Slice of Day framework adopted in D.22-06-050. Its objection, sustained across a proceeding sequence that runs from the central procurement debate in R.17-09-020 through R.21-10-002 and R.20-11-003 into the current R.25-02-005 record, is that the Commission has implemented the reform in ways that systematically devalue industrial demand response.
Slice of Day and the qualifying capacity problem
The Slice of Day framework moves RA accounting from a single monthly showing to twenty-four hourly windows. CLECA has argued that when the framework makes that move, it makes no sense to value demand response on a four-hour average over the four-to-nine evening window — a methodology that understates what an industrial resource can actually deliver in the hours the grid needs it.
CLECA has likewise opposed the continued use of the prior Effective Load Carrying Capability (ELCC) methodology for monthly qualifying capacity in ways that misalign Commission and California Independent System Operator (CAISO) programs, and has opposed the elimination of the Reliability Demand Response Resource (RDRR) availability provisions that allowed Base Interruptible Program customers to commit firm capacity without exposure to availability penalties. The resource has earned that treatment on the record: RDRR performed at 89 percent across the four highest-load days of the September 2022 heat wave.
D.21-06-029, D.23-06-029, and the petitions for modification
Two decisions define the recent arc. D.21-06-029 and D.23-06-029 changed dispatch triggers and eliminated availability provisions that underpinned the economics of the Base Interruptible Program. CLECA filed petitions for modification of both decisions, including an August 2023 petition seeking modification and a partial stay of D.23-06-029, and escalated with at least six ex parte notices through late 2023.
The stakes were quantified in the record. SCE estimated that roughly 250 MW of BIP capacity could disenroll as a result of the RA decision — capacity that would cost ratepayers an estimated $80 million per year to replace. When the underlying problem persisted, CLECA carried the same arguments into its 2024 testimony in the consolidated Demand Response Programs proceeding, A.22-05-002.
The affordability logic
CLECA's RA advocacy consistently returns to Public Utilities Code section 451's requirement that rates be just and reasonable. A Commission order that systematically prices industrial demand response below its value will, in time, drive that resource out of the market and force its replacement with more expensive new generation — which industrial ratepayers, already paying rates roughly 300 percent of those in neighboring states, will then fund.
That is not an abstraction. Demand response provided by large industrial customers is fast, fuel-independent, all-weather, and zero-carbon. Losing it makes the RA program both less reliable and more expensive.
Where the fight stands
The post-D.23-06-029 architectural questions remain substantially unresolved, and the Resource Adequacy reform fight continues in R.25-02-005 and downstream proceedings. CLECA has also argued that Slice of Day implementation must be coordinated with the demand response rulemaking R.25-09-004 so that RA delivery is valued in all hours. CLECA's position going in is the same one it has maintained for eight years: reform the program, but do not implement the reform in a way that prices the state's most cost-effective industrial reliability resource out of the market.