California Budget Update

California Governor Gavin Newsom released his proposed 2024-5 budget, which is the first step of a months-long budget negotiation process with the legislature. The proposed budget focuses on addressing a projected $38.9 billion shortfall which is significantly less than the $68 billion shortfall projected by the Legislative Analyst's Office (LAO). In the Governor's proposed budget, a few CESA priorities are impacted, as summarized below. There will be many updates as the budget process moves forward.

Residential Solar and Storage: A delay of $200 million General Fund ($75 million in 2024-25 and $125 million in 2025-26) for the Residential Solar and Storage Program. Instead, $100 million in 2026-27 and $100 million in 2027-28 would be available. The Budget maintains the $630 million to the CPUC for this program.

Incentives for Long Duration Storage: A shift of $56.9 million General Fund to the GGRF in 2024-25 for the Long Duration Storage Program at the CEC. The Budget maintains $330 million for the program with this shift.

Investments in Strategic Reliability Assets: A delay of $55 million General Fund for the Electricity Supply Reliability Reserve Fund Program from 2024-25 to 2025-26. The Budget maintains the full $2.37 billion General Fund to the DWR.

Oroville Pump Storage: A delay of $200 million General Fund ($90 million in 2024-25 and $110 million in 2025-26) for the Oroville Pump Storage Project. The delay results in $100 million General Fund in 2026-27 and $100 million in 2027-28. The Budget maintains the full $240 million to the DWR for this project.