Are Virtual Power Plants the Solution in California?
- May 18, 2021 6:31 pm GMT
Things aren’t looking good in California. Heading into Summer 2021, CAISO estimates that the state’s power network is only slightly better prepared than it was a year ago for a major heatwave. This sad analysis comes after the California Public Utilities Commission did what basically every industry expert wanted them to do. They got additional generation procurement. In February, CPUC directed utilities operating in the state to contract extra capacity from existing power plants. The move drew a lot of criticism from environmentalists who worried it could lead to more gas contracts. In March, the CPUC greenlighted another decision that included the additional procurement of up to 1,500 MW for 2021 and 2022.
So what’s left for the Golden State? A number of commentators are enthusiastic about the potential of “virtual power plants.” Here’s how the idea is described in a recent L.A. Times article on the state’s electricity challenges: “string together hundreds or thousands of batteries, as well as “flexible demand” programs that pay people to use less electricity.”
Some utilities in California have already started moving towards virtual power plants. Last year, three government run utilities signed deals with Sunrun, a virtual power plant company. More recently, Southern California Edison contracted Sunrun for a five-megawatt system.
These systems will provide just a tiny fraction of energy in the grand scheme of things. And, what’s more, it remains to be seen how they compare to traditional gas options after sunset.
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