Dive Brief:
- A virtual power plant program in Ontario, run by Ontario's Independent Electricity System Operator in partnership with grid-edge flexibility provider EnergyHub, has enrolled 100,000 homes since the program launched in mid-2023.
- The Save on Energy Peak Perks program is the fastest growing flexibility program in EnergyHub's portfolio, and is capable of reducing peak demand by up to 90 MW, according to EnergyHub.
- Comparable programs already exist in the U.S., according to Mary Tobin, an associate at RMI. But it could be difficult to replicate the specific circumstances of the Ontario project in the U.S., said EnergyHub head of customer solutions Erika Diamond.
Dive Insight:
Virtual power plants have seen significant growth over the past year thanks to growing awareness among utilities and consumers alike, according to RMI. But the Save on Energy Peak Perks program likely benefited from some location-specific factors, Diamond said.
First, there's the fact that the program is in Canada's most populous province, which gave it a sizable population base, Diamond said. But it also benefited from the fact that the program is operated directly by Ontario's Independent Electricity System Operator. This meant the program was able to avoid some common barriers to customer enrollment, such as the need to ask customers for their utility account numbers or meter data, Diamond said. Another IESO program offering free installation of smart thermostats further increased the number of customers who were immediately able to participate in a virtual power plant, she said.
Running virtual power plants through independent system operators rather than though individual utilities probably would boost enrollment elsewhere in North America, Diamond said. But it likely wouldn't be possible in the U.S., where ISOs rarely interface directly with consumers.
But there are comparable virtual power plants running — at the utility level — in the U.S., according to RMI. The Cool Rewards program by EnergyHub and Arizona Public Service, which as of RMI's last count had 78,000 customers enrolled, is the most directly comparable program, Tobin said. The Cool Rewards VPP can provide nearly 110 MW of capacity — a larger figure than the Ontario project primarily on account of Arizona's warmer climate and differences in program design, Diamond said.
Other U.S. VPPs, such as the ConnectedSolutions program in New England, have seen similar levels of success by aggregating residential and commercial resources across utility and state lines, said Kevin Brehm, manager of the Virtual Power Plant Partnership at RMI. The ConnectedSolutions had 34,000 customers representing 310 MW of capacity enrolled at the end of 2020.
The most recent figures from the U.S. Department of Energy estimate that existing VPP programs represent between 30 GW to 60 GW of capacity in the U.S. Although it's difficult to track individual utility participation, Brehm estimated that a majority of U.S. utilities are either participating in a virtual power plant or working to launch one.
