On 2025-09-11, the California Legislature passed Assembly Bill 39 (AB 39), the Local Electrification Planning Act, which mandates that cities and counties develop local electrification plans including expanded EV charging, building decarbonization, and clean energy integration, a move that market analysts say enhances prospects for utility-scale battery storage as a backbone for the state’s clean energy infrastructure.
Background on AB 39
AB 39, authored by Assemblymember Rick Chavez Zbur (D-Hollywood), requires all California counties and cities to prepare comprehensive local electrification plans to: expand electric vehicle (EV) charging infrastructure; decarbonize homes and buildings; integrate renewable energy resources to meet growing demand; and address public health risks associated with extreme heat and climate threats. The law is aimed particularly at ensuring benefits for low-income households and disadvantaged communities.
The legislation builds on California’s goals to achieve 5 million EVs on the road by 2030, and 100% zero-emission sales of new passenger vehicles by 2035, by providing a local planning framework aligned with those targets.
Implications for Utility-Scale Battery Storage
Strengthened Grid Requirements
Analysts say AB 39’s requirement to expand clean energy resources locally will push demand for utility-scale battery storage as a tool to balance supply and demand, especially in regions introducing more intermittent generation (solar, wind). Batteries can help absorb the load shifts due to EV charging, thermal load from buildings, and extreme heat events. (Interpretation based on policy emphasis in AB 39, combined with California’s energy planning trends)
Developer Interest and Market Signals
Following AB 39’s passage, clean energy consultancies and battery storage developers reported increased attention from municipalities seeking to integrate storage solutions. There is no public filing yet of battery projects explicitly referencing AB 39, but requests for proposals (RFPs) for grid-scale storage and for interconnection have reportedly accelerated in Southern California and the Central Valley.
Equity, Public Health, and Environmental Drivers
AB 39 emphasizes benefits for communities facing disproportionate climate and public health burdens, such as disadvantaged neighborhoods. Battery storage helps reduce local emissions by enabling clean energy and reducing reliance on peaker plants. The linkage between electrification and clean cooling technologies (like heat pumps) also suggests storage needs to buffer demand.
Challenges and Remaining Uncertainties
While AB 39 sets a planning requirement, implementation will depend on funding, staffing, and technical support for local governments, especially smaller counties. Interconnection delays remain a known hurdle for utility-scale battery storage deployment in California, as do grid capacity constraints in some regions. There is also the question of how quickly renewable energy build-out will match growth in demand to make storage economically viable.
Moreover, regulatory coordination among local, state, and utility regulators will be vital. AB 39 does not itself provide large direct subsidies for storage deployment, so many projects will depend on other incentives or utility procurement policies.
Outlook
In summary, AB 39 signals a shift in California toward more structured, local-level planning for electrification and clean energy. For utility-scale battery storage, the bill improves the policy environment and adds forward momentum in demand fundamentals. Still, actual deployment will depend on execution: funding mechanisms, interconnection capacity, incentive alignment, and regulatory support will determine how fast storage projects move beyond planning into construction.