New rules from California’s utilities regulator will finally allow distributed energy resources (DERs) like solar and battery projects to help balance the state grid.

“This will open up opportunities for distributed energy resources to be designed in a way that aligns with grid needs,” Sky Stanfield, an attorney who works with the Interstate Renewable Energy Council, told Canary Media. “It’s a long time coming to recognize that distributed energy resources are a whole lot more helpful than they’re allowed to be—and that we don’t have to spend as much to upgrade the grid as a result.”

The new interconnection rules approved by the California Public Utilities Commission (CPUC) in mid-March aim to move past concerns from utilities that solar panels and batteries could disrupt grid stability through power injections that are misaligned with demand, writes Canary Media. Utilities, because they consider the risk of new power generation sources through a “simplistic set of assumptions,” calculate the potential disruption from new projects by projecting peak output at times of lowest customer demand. So they have historically exaggerated the likelihood of a project to disrupt services—though arguably with good reason, as it is their responsibility to ensure grid safety and reliability.

So utilities tend to push back against new connections for projects, demanding that project developers pay for grid upgrades to eliminate risks—a costly enough demand that projects are effectively stopped.

Now, the Limited Generation Profile option takes into account how, “with the right structures in place, solar and solar+battery systems can be more help than hazard to California’s overworked grid,” Canary Media writes.

Despite the worst-case scenarios projected to calculate risk, DERs can actually help reduce grid strains when used as a source of reserve power to be discharged back to the grid during times of high demand. According to analysis by Amin Younes, an electric distribution planning and policy engineer with CPUC’s Public Advocates Office, bringing these projects online with the Limited Generation Profile option can create extra capacity that “could add up to tens of billions of dollars per year in additional clean energy that could be delivered.”

The new policy is suited for larger-scale projects like community solar installations that would be more likely to require grid upgrades, Canary writes. These projects can now use technologies—like solar inverters that can reduce output or batteries to store excess power—to control the power they send back to the grid, using grid data maps developed in the past decade to determine a set of schedules for altering grid injections throughout the day.

“Now, by taking into account the grid conditions at their proposed project site, and designing an export schedule based on those conditions, project developers have a means to avoid potentially costly grid upgrades,” writes the Interstate Renewable Energy Council.

“Not only will this save money for individual developers and customers, it will also enable the grid to accommodate significantly higher levels of renewable energy at a lower overall cost.”