- Massive infrastructure boost: The $15 billion loan will fund hydropower, battery storage, and grid-enhancing technologies, including virtual power plants across Northern and Central California.
- Customer savings: PG&E estimates over $1 billion in lifetime savings for customers due to lower interest rates and reduced annual costs.
- Community benefits: Investments prioritize underserved communities, workforce development, and outreach programs for disadvantaged groups.
The U.S. Department of Energy’s (DOE) Loan Programs Office (LPO) has approved a $15 billion conditional loan guarantee to Pacific Gas & Electric (PG&E) for hydropower, battery storage, and grid expansion projects. This marks a significant investment in clean energy infrastructure aimed at increasing grid reliability and affordability.
“This enables us to save money for customers; this is a straight pass-through to all of our customers in PG&E service areas,” said PG&E CEO Patti Poppe. “Over the life of the loans, we would save over $1 billion for customers.”
Transforming California’s Energy Future
The DOE loan is part of its Energy Infrastructure Reinvestment (EIR) program, which funds projects that repurpose aging infrastructure and reduce pollution. PG&E’s projects include:
- Developing virtual power plants by integrating small-scale energy resources.
- Expanding battery storage to enhance grid capacity.
- Locating projects in disadvantaged communities, identified using the Climate and Economic Justice Screening Tool.
PG&E has been working on the loan deal since mid-2023 and expects it to close soon.
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The DOE emphasized: “These infrastructure investments will help PG&E meet forecasted load growth, increase electric reliability, and reduce costs for its consumers across California.”
Focus on Community Impact
PG&E is partnering with the International Brotherhood of Electrical Workers to train and employ individuals from underserved communities. Its community benefits plan will engage Native American tribes, local organizations, and low-income communities to ensure inclusive economic opportunities.
Poppe noted the broader implications of these efforts, including positioning California as a leader in AI by powering new data centers and increasing grid capacity for future demand.
“Remaining the global leader in AI will require power, so having a better grid is going to be good for everyone,” Poppe said.
Takeaway
This $15 billion investment underscores PG&E’s commitment to clean energy innovation, affordability, and community development, while ensuring California’s grid meets the demands of the future.
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