Dive Brief:

• Southern California Edison last month tapped Nest to connect 50,000 homes in its service territory and transform them into a virtual power plant capable of controlling about 50 MW of load reduction, Greentech Media reports. 
• The expansion of SCE's demand response program comes as the state copes with potential natural gas shortages stemming from the Aliso Canyon natural gas leak, possibly leading to blackouts next year.
• The leak left the storage facility at about 20% of capacity, leading the California Public Utilities Commission to authorize an expansion of the Peak Time Rebate program (PTR), in addition to other demand response products at SCE. 

Dive Insight:

Harnessing 50,000 customer thermostats is a tall order, but Greentech points out that it is an enticing offer for customers. Given the PTR slate of rewards, a $249 Nest thermostat could pay for itself in one year of customer participation in SCE's program.

“50,000 households enrolled in particular geographical bounds is certainly an ambitious goal," Ben Bixby, energy businesses director for Alphabet, Google's parent company, told Greentech. He added that rather than build that resource from the ground up, "we’ll be tapping our existing installed base to provide immediate relief."

In an order earlier this summer, state regulators authorized additional funding for demand response programs to deal with the natural gas leak. The state has been rushing to approve storage assets as well, in an attempt to stave off possible blackouts. It has left SCE trying to power the region while having access to 97,100 metric tons less gas, bringing up questions of grid stability. 

Discovered last October, the worst methane leak in U.S. history led Gov. Jerry Brown to call on the CPUC to take action to ensure reliable supplies of gas and electricity.

Southern California Gas Co., which operates the Aliso Canyon facility, this week agreed to pay $4.3 million under a settlement reached with the District Attorney's Office for Los Angeles County.  The gas company will plead no contest to one misdemeanor violation of health and safety codes for failing to report the leak immediately to the state and county emergency services. The leak ultimately forced the evacuation of nearly 6,000 residents.