PG&E Advances Deployment of Community Microgrids, Announces New Grant Agreements and Second Round of Funding Awards

$30 million second wave advances local clean energy microgrids designed to keep communities powered during outages 

OAKLAND, Calif., Sept. 17, 2026 /PRNewswire/ -- Pacific Gas and Electric Company (PG&E) announced a major milestone in the deployment of community microgrids across Northern and Central California, including new grant agreements for projects moving into development and the selection of six new projects through the second application window of its Microgrid Incentive Program (MIP). This work builds on $43 million PG&E announced in 2025 for nine initial projects. 

Together, the projects represent more than $73 million in authorized community microgrid investments supporting local clean energy systems designed to help communities stay powered during outages. These projects span rural, coastal, Tribal and high wildfire risk areas across Northern and Central California. 

 "In addition to the grid investments PG&E is making, community microgrids empower communities to take an active role in building local resilience," said Dave Canny, Head of PG&E's North Coast Region. "PG&E is proud to partner with communities by providing incentives, technical support and the safe interconnection needed to bring these projects to life. The North Coast has helped lead the way in microgrid innovation through pioneering projects like the Redwood Coast Airport Microgrid and the Blue Lake Rancheria Microgrid. Today's MIP awardees — with advanced solar-plus-storage systems and innovative pumped-hydro designs — are building on that legacy, showing how communities and utilities can work together to strengthen resilience, keep critical services powered and advance clean energy solutions for the future." 

Building Local Power for Communities
A community microgrid is a grid-connected local energy system that can continue serving customers by operating independently during grid outages. 

It can help keep power on for: 

• Hospitals and health clinics 
• Fire stations and emergency services 
• Schools and local businesses 
• Other critical facilities and services 

Microgrids can use: 

• Solar power 
• Batteries 
• Other energy sources like biomass  
• Smart grid equipment—such as switches, circuit breakers or reclosers—paired with microgrid controllers that allow a community to safely separate from the grid and keep power flowing locally during an outage 

When the main grid goes down, microgrids can keep key services running for hours or even days. 

Tranche 1: Projects move forward with new grant agreements
PG&E is advancing several of the nine projects selected in the first application round, with awardees executing grant agreements indicating they are ready to proceed.  

These agreements set the terms and conditions for the disbursement of funds which will support microgrid engineering, design and development work—critical steps to bring projects from concept to construction. 

Lake County Advances Innovative FLASHES Microgrids
Three proposed projects in Lake County are advancing a first-of-its-kind approach known as Firemain Linked Auxiliary Supply/Hydraulic Energy Storage (FLASHES). 

• The proposed projects intend to pair tens of megawatts of locally generated solar energy with pumped hydroelectric storage that uses subsurface water resources. Solar power will be used to pump water to roofed tanks at higher elevations when energy is abundant. When electricity is needed, the water will be released through turbines to generate power. 
• The result is a system that could provide both long-duration energy storage and multi-day resilience during outages, as well as additional water supply for firefighting emergencies. If successful, the projects could serve as a model for how communities across California use local renewable energy and long-duration storage to improve resilience. 

"The FLASHES projects carry the potential to deliver energy and wildfire resiliency for Lake County communities, while also creating construction jobs and apprenticeships that could prove to be life-changing," said Brad Rasmussen, Chair of the Lake County Board of Supervisors. "Just as importantly, areas that would be hardened by the project, if constructed, include critical community facilities like the County Jail and Northwest Wastewater Treatment Plant. Funding pre-development work has long been a barrier to this project's progress. We are grateful that PG&E's Microgrid Incentive Program grant will enable the county to accomplish the first step to fully vet the environmental and financial feasibility of this innovative project." 

The three proposed microgrids would serve communities along the northwest shore of Clear Lake, from North Lakeport to Nice, as well as portions of the Hidden Valley Lake area. 

All three projects are moving into early development to determine feasibility, with geotechnical core boring, initial test well drilling, and other activities planned over the coming months. 

All three FLASHES projects were a result of collaboration between local governments and Trane Energy Services.  

"We are proud to partner with PG&E, Hidden Valley Lake and County of Lake to advance feasibility studies for these innovative microgrid projects," said Johnny Brown, Vice President and Regional General Manager for Trane. "FLASHES represents a new model for community resilience, bringing together dispatchable renewable energy, long-duration storage and critical water supply in a single project to strengthen grid resiliency, support wildfire emergency response and reduce carbon footprint. It reflects a shared commitment to advancing practical innovation that can help communities build a more resilient and sustainable energy future. After seven years of collaboration with county and community partners to help shape this vision, we're grateful for PG&E's support through the Microgrid Incentive Program to move this next phase forward." 

Tranche 2: Second round awards expand microgrid footprint
PG&E is also announcing the selection of six new projects from the second MIP application window. 

This second wave directs $30 million to projects that will: 

• Serve more than 2,200 customers 
• Support critical facilities, including schools, fire stations and health centers 

These projects use a mix of: 

• Solar 
• Battery storage 
• Biomass and biodiesel 

Together, they expand access to reliable, local energy solutions across PG&E's service area, including projects in Humboldt, Sonoma, San Mateo, Butte, Placer, and El Dorado counties. 

Award amounts range between $2-6 million each. 

One project from Tranche 2 is already advancing: in San Mateo County, the Pescadero project will be led by WestLight Energy, formerly Peninsula Clean Energy.  

• This system will energize most of the town of Pescadero, a remote coastal community along the San Mateo coastline. It includes more than 200 customers including key critical facilities.  
• The microgrid will integrate a roughly 1.5 megawatt (MW) solar system and a 2 MW battery energy storage system, to support a minimum of 24 hours of standalone operation.  
• In addition to PG&E's MIP funding, this project will also include funding from WestLight Energy and the County of San Mateo. 

"When a community faces a challenge that doesn't have an obvious solution, local public agencies like WestLight Energy have an opportunity to bring partners together," says Shawn Marshall, CEO of WestLight Energy. "That's exactly what happened here. This project shows what's possible when community organizations, local government, utilities and clean energy partners work toward a common goal." 

What Customers Can Expect
As these projects move forward, customers can benefit from: 

• More resilient electric service 
• Greater protection for critical community services 
• Cleaner local energy resources 
• Improved wildfire and emergency resilience 
• Stronger community energy independence 

More About MIP 
The Microgrid Incentive program is a statewide $200 million competitive grant program to fund clean-energy community microgrids in disadvantaged and vulnerable communities. 

• Authorized and approved by the California Public Utilities Commission, the new program allocates a total of $79.2 million in project funding for PG&E, $83.3 million for Southern California Edison, and $17.5 million for San Diego Gas and Electric.  
• Projects selected under the MIP can receive up to $14 million in award funding each for the design and development of a multi-customer, front-of-the-meter community microgrid. 
• Customers and communities interested in learning more or applying for grants through the third and final wave of PG&E MIP grant funding should visit www.pge.com/mip    

About PG&E
Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE: PCG), is a combined natural gas and electric utility serving more than sixteen million people across 70,000 square miles in Northern and Central California. For more information, visit pge.com, pge.com/news, and pge.com/innovation.     

SOURCE Pacific Gas and Electric Company