A✌️420-word✌️2.5-minute✌️read
A month ago I wrote a post about California’s Demand Side Grid Support Program or DSGS. The gist of the post was that due to California’s $12 billion budget hole, the program was in danger of being defunded.
Programs facing a funding cut isn’t unusual. Nor is California facing a massive budget deficit. That wasn’t the point of the post.
The point was that a successful test of the DSGS program had just been conducted. It proved that what is believed to be the world’s largest virtual power plant performed as expected.
To recap:
▶ Hundreds of thousands of customers opted in with the expectation of financial incentives for making their resources available to the grid operator.
▶ The total enrolled capacity increased from 500 MW to 800 MW in less than year.
▶ The two-hour test - conducted during peak demand in July - was record-breaking in that the utility was able to access and redistribute statewide an estimated 535 megawatts power from residential batteries in more than 100,000 homes.
▶ Research firm Brattle estimated that the amount of bi-directional power accessed during the test equaled that of a big hydro dam or 50% of a typical nuclear reactor.
▶ The best part: the grid didn’t crash.
The point of proving that bi-directional virtual power plants can work as designed is to leverage them to replace costly peaker plants or avoid having to buy expensive power during emergency periods of high demand.
In other words - VPPs represent a major cost savings.
A 2023 study by Gridwell Consulting found that the state’s four days of emergency grid conditions in September of 2022 cost ratepayers more than $1 billion. Even if Gridwell’s estimate is off by half, that was still a boat load of money.
The cost of DSGS program through 2028: $473 million.
Keeping a gas-fired peaker plant operational through 2026: estimated to cost $1.2 billion.
So naturally, in its final budget the California legislature pulled all funding from the program.
California managed to retain its cap-and-trade program, which it renamed “cap-and-invest.” Clever, except that the monies that the DSGS program was expected to receive from the cap-and-invest program evidently got invested somewhere else. Undoubtedly to cover the woeful mismanagement of the state’s political leaders.
Advocates of the program are hoping that an alternative funding method can be found. No doubt so are participants in the program who face the prospect of receiving no compensation for sharing their resources in 2026.
I’m sure they’ll understand.
#vpp #electricgrid #powergeneration #electricity