Virtual Power Brightens the Future

Imagine the impact of a United States white-glove clean power system with costs benefits to individual homeowners in a Virtual Power Plant network (VPP) extending coast-to-coast with every household, en mass, involved in electrical power generation for the entire nation.

It’s coming. It’s a future where everybody benefits as greenhouse gas emissions such as CO2 dissipate as homeowner electric bills shrink and utility grid brownouts and blackouts cease. It’s a sun-worshipping wonderland of clean energy that works without intermittency 24/7.  And, it’s coming, quietly but surely.

A prototype in New England has already proven hugely successful. Sunrun, a global leader in solar power, established the first-of-a-kind Virtual Power Plant this past summer by interconnecting 5,000 small-scale home solar energy systems in Massachusetts, New Hampshire, Rhode Island, and Vermont to create a Virtual Power Plant. The 5,000 homes utilize home solar and home battery storage units to provide power to the grid when energy demand is high in addition to providing additional home electricity.

The Sunrun program clearly demonstrates that VPPs can deliver electricity to multistate power markets. This is the first successful major Virtual Power Plant operation on a multistate level and a peek into the future of electrical power generation via cooperation amongst consumers and utility grid operators; it’s semi-cooperative with the grid operator still in control.

“This is the energy system of the future and the future is not very far away,” according to Todd Olinsky-Paul, Senior Project Director/Clean Energy States Alliance and Clean Energy Group.1

Already, Virtual Power Plants are starting to spread across the country. In certain respects, it is a grassroots movement as householders with solar and backup battery storage of solar energy come together. For example, in California, when Pacific Gas & Electric (PG&E) put out notices for customers to conserve energy during the 2022 hot summer, 2,500 PG&E customers with Tesla Powerwall battery systems came together to add up to 16.5MWof solar power delivered to the grid.

According to PG&E CEO Patti Poppe, when the Tesla/PG&E Virtual Power Plant activated for the first time August 17th: “The world’s largest distributed battery sure did put on a show.”2

There are approximately 50,000 Tesla storage systems in PG&Es service area. When the grid is stressed, customers who chose to participate are paid $2/kWh of electricity exported to the grid. This is a prime example of a very powerful movement spreading across the country to combat the challenges of an increasingly dangerous cycle of excessive fossil fuel-derived CO2 emissions causing global heating that’s threatening the entire American West by turbo-charging a vicious endless drought of the past two decades.

That relentless drought is testing the resilience of America’s desert cities, which fortunately have been in preparation for decades, see:  “A Quiet Revolution: Southwest Cities Learn to Thrive Amid Drought“, YaleEnvironment360, April 26, 2022.

Last Bulb is an org that tracks the growth of the Tesla Virtual Power Plant in California. Tesla Powerwall owners have now been conjoined to Southern California Edison as well as PG&E with a virtual network of 3,500 homes having power capacity of 50MW. This is a powerful fallback safety valve as well as enhancement to the power grid.

The Virtual Power Plant movement bringing utilities and consumers together is also bringing together a relationship between a nonprofit that builds affordable housing in partnership with a local utility, joining forces in a Virtual Power Plant to benefit low-income homeowners who will be compensated by providing power to the grid.

According to an article in Grist entitled: “The Plan to Turn Blighted Houses Into a New Source of Green Power for the Grid”, August 3, 2022 by Emily Pontecorvo: CEO James Becker of the nonprofit RCF Connects restores abandoned homes and facilitates first-time home ownership in dilapidated/blighted areas of Richmond, California.

The rejuvenated homes are outfitted with energy-efficient lighting, an electric vehicle charger, electric stove, electric heat pumps for heating, air conditioning, and an internet-connected “smart thermostat. Rooftop solar panels and a backup battery system allow homeowners to self-power their homes during a power shortage, and they become part of California’s power grid and earn money doing so as part of a Virtual Power Plant.

As such, low-income homeowners will not only be self-reliant as well as experience lower power bills and generate income from the grid, but they will also help cut greenhouse gas emissions and local pollution, especially significant, as Richmond’s California Air Quality Index at 39.4 is a lowly ranking of #1,354 in the state.  “Richmond has long been known for the three Cs: crime, corruption, and Chevron.”3

According to the Grist article, since starting the program in 2015, RCF has completed 20 renovations in blighted areas of Richmond. RCF prevents gentrification of the blighted zones by working with the California Housing Finance Agency and other sources giving priority access to participants via a financial counseling service and a first-time buyer program that RCF administers, including a down payment assistance program of up to $20K for low-income buyers.

Meanwhile, the world beyond America is starting to build-out Virtual Power Plants. For example, AGL/Australia is the world’s largest retail led Virtual Power Plant. In Australia 2.5 million households have rooftop solar power and can elect to join AGL Virtual Power Plant/Adelaide, which uses cloud-based operation systems to interconnect solar batteries installed in homes and businesses in the city.

And, in Japan on the island of Miyako-jima, since 2021, Tesla has installed a Virtual Power Plant with Powerwalls in over 300 homes. It’s the largest commercial Virtual Power Plant in Japan. Tesla expects to have over 600 Powerwalls installed on the island within the next 12 months.

People living on Miyako-jima experience regular power outages during typhoons, and Powerwalls keep the lights on in individual homes. “During typhoons, lights are available, refrigerators are usable as usual,’ claims a Powerwall customer.”4

Virtual Power Plants are the most opportunistic way to connect consumers to the reality of tackling a nearly out of control global warming conundrum that the nations of the world have not properly tackled.

Rather, avoidance of IPCC Paris ’15 commitments to reduce emissions has been the low road traveled by nearly all of the 190-nation attendees to Paris ‘15. It’s outrageously scandalous. But, setting the tone, the Trump administration deniers withdrew from the Paris ‘15 accords! That major setback still reverberates among other nations that followed suit by not cutting emissions, as promised, proclaiming: If America doesn’t commit then why should we!

The interconnectivity of householders to vast grids statewide or nationwide brings forth the stark realization that something about the climate change issue has been amiss, mishandled, or askew. After all, if individual consumers can make a difference in combating global warming, why shouldn’t major governments be onboard as well?

And, yes, something has been amiss for decades now. In America, until only recently, it has been, and remains, abject political failure sparked by Republican deniers failing to come to grips with the dangers of greenhouse gases like fossil fuel-derived CO2 blanketing the atmosphere, heating up the planet, which has gotten out of hand and everybody knows it, but nobody does anything about it because they have tirelessly blocked opportunities.

However, Biden’s shabbily named Inflation Reduction Act has become a much-needed breath of fresh air green catalyst, of sorts.

Meanwhile, in more than a subtle fashion Virtual Power Plants send a signal to the public that mean-spirited politics in the face of dire circumstances should suffer consequences: How dire? While blindfolded throw a dart at a world map. Bulls-eye, you’ll hit one of the worst drought areas of the past 500-to-1200 years!

Oh, by the way, don’t forget to vote. It counts!

Postscript: Speaking of voting and its impact, Sweden’s new far-right PM Ulf Kristersson freshly installed on October 18th celebrated victory by dismantling the Ministry of Environment on October 19th.

  1. Miranda Wilson, “Northeast Embraces First-of-A-Kind Virtual Power Plant”, E&E News, EnergyWire, October 12, 2022. []
  2. Kavya Balaraman, “PG&E, Tesla Virtual Power Plant Delivers 16.5 MW to California Grid Amid Calls for Energy Conservation”, Utility Dive, August 23, 2022. []
  3. Richmond v Chevron: The California City Taking on its Most Powerful Polluter, The Guardian, October 9, 2019. []
  4. “Tesla Quietly Built a Virtual Power Plant in Japan”, The Verge, August 29, 2022. []
Robert Hunziker (MA, economic history, DePaul University) is a freelance writer and environmental journalist whose articles have been translated into foreign languages and appeared in over 50 journals, magazines, and sites worldwide. He can be contacted at: rlhunziker@gmail.com. Read other articles by Robert.