USA – CALIFORNIA Trends and Developments Contributed by: Nora Sheriff, Gwenneth O’Hara and Samir Hafez, Buchalter LLP
CPUC Rule 21 Enhancements (R.25-08-004) The CPUC’s Rule 21 framework – governing intercon- nection of distributed energy resources (DERs) – is undergoing further refinement in Rulemaking R.25 08 004. This proceeding reflects growing recognition of the importance of distributed resources, including roof- top solar, storage, and flexible loads, in supporting grid reliability and managing load growth. Key themes include: • improving interconnection timelines and transpar- ency; • addressing hosting capacity constraints; and • enabling greater integration of distributed storage and demand response resources. While Rule 21 reforms are distinct from CAISO’s trans- mission-level interconnection processes, they serve a complementary function by facilitating distributed resource deployment and potentially reducing pres- sure on bulk system infrastructure. CEQA Changes and Transmission Permitting Environmental review under the California Environ - mental Quality Act (CEQA) has also undergone mean- ingful changes during this period, particularly in con- nection with transmission siting. The most significant development is the CPUC’s adoption of General Order 131 E on 30 January 2025, which modernises the permitting framework for trans- mission infrastructure. Although GO 131 E does not change CEQA’s substantive requirements, it intro- duces several procedural reforms that directly affect CEQA review for transmission projects: • allowing applicant-prepared draft CEQA docu- ments (including EIRs and mitigated negative declarations); • requiring pre-filing consultation at least six months before application submission; • enabling concurrent submission of CEQA materials and permit applications; and • establishing a pilot programme to evaluate acceler- ated CEQA timelines.
In addition, the introduction of a rebuttable presump- tion of need for projects identified in CAISO’s trans- mission plans reduces duplicative analysis in CEQA review, particularly with respect to project alternatives. Separately, California enacted significant CEQA leg- islation in mid-2025, including AB 130 and SB 131, which introduce new exemptions and streamlining mechanisms across multiple sectors. While these reforms do not target transmission pro- jects, they reflect a broader trend toward facilitating infrastructure development, housing, and climate- related projects through expanded exemptions and procedural efficiencies.
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