Stem, CPower will pair DR, energy storage for dispatchable virtual power plants

Dive Brief:

Stem and CPower have formed a partnership to deliver demand side energy solutions to U.S. customers starting in California.
The partnership will combine Stem’s energy storage devices with CPower’s demand response services in order to enable utilities access to dispatchable virtual power plants.
The partners hope to combine the quick response time and ability of batteries to reduce demand charges with the slower response time but lower costs of traditional demand response tools.

Dive Insight:

Energy storage providers are finding that aggregating storage and distributed energy resources can give them “a foot in the door” in wholesale power markets.

The California ISO has two products available for aggregated DERs: one for demand response providers, proxy demand response (PDR), and one for DER providers, known as DERP. In particular, CAISO developed rules for DERPs to allow for aggregating different types of resources in the ISO markets, but these complex rules have yet to be put into practice.

Still, companies are sussing out opportunities to leverage aggregated DERs, as the emerging market begins to gain traction. It is an approach companies such as Tesla and EnerNOC have taken, as have Advanced Microgrid Solutions and PowerSecure. In their new partnership, Stem and CPower say California is one of the first markets they plan to target.

The company told Greentech Media it is already “engaging with customers” and looking “forward to some quick wins in California.”

The partners hope to find synergies by joining batteries’ demand cutting ability with demand response tools that can turn down air conditioning and heating systems, refrigerators and motors.

“If you're solving it all with a battery, it’s going to be an expensive solution. If you’re doing it all with curtailment, it’s going to be a potentially disruptive solution,” Jason Babik, senior vice president of business strategy and development at CPower, told Greentech Media. Combining the two “can be really a 'one plus one equals three' type play,” he said.