Relieving Local Power Grid Hotspots: The Role of Virtual Power Plants
PG&E Launches Pilot Program to Optimize Grid with Customer-Owned Energy Resources
Pacific Gas & Electric (PG&E) is embarking on a new initiative this summer and fall, aiming to enroll up to 1,500 residential customers with solar-charged batteries from companies including Sunrun and up to 400 customers with smart electrical panels from startup Span. The program, named SAVE (Seasonal Aggregation of Versatile Energy), is designed to test how customer-owned batteries and home energy controls can meet grid needs more precisely, down to the neighborhood level.
The SAVE program is part of PG&E's strategy to address the increasing costs of maintaining distribution grids. A recent analysis suggests that tapping California's nation-leading fleet of rooftop solar, backup batteries, and electric vehicles (EVs) for this task could save billions of dollars in grid upgrade costs.
PG&E has experience operating virtual power plants (VPPs) to reduce stress across the statewide grid. The SAVE project is exploring the possibility of strategically concentrating VPPs in certain areas to defer expensive upgrades to nearby poles, wires, and other infrastructure.
To manage this complex system, PG&E has built a Distributed Energy Resource Management System (DERMS) that it's using to manage EV charging hubs and utility-scale batteries. The utility is currently building communications with aggregators for the SAVE project, interfacing with software from Lunar Energy and Tesla to control the batteries, and with Span's software that keeps whole-home energy use below certain thresholds.
However, utilities need to ensure they can count on customer-owned assets without risking the grid's reliability before implementing this strategy. Trevor Udwin, PG&E's VPP and grid optimization manager, stated that building trust is crucial. This involves someone signing a commitment to deliver the grid relief needed during specific times, and a distribution planner changing their operations based on that commitment.
PG&E is not delaying upgrades on the parts of the grid it's testing just yet, but the SAVE project will inform next steps to start doing this kind of proactive, VPP-integrated grid planning at a larger scale. The battery system manufacturers collaborating with PG&E for the SAVE program this year include Tesla, Sonnen, and LG Energy Solution.
California's big utilities have run multiple DERMS pilot projects over the years, but very few utilities have deployed a DERMS system like the one PG&E is using. Different grid substations and circuits may have very different load shapes and may peak differently at different hours, making it challenging to coordinate the interactions across low-voltage distribution networks.
The SAVE project does not yet integrate the DERMS platform with the communications and controls technology deployed with its partners. This is an area that PG&E hopes to address in the future, as it continues to explore ways to optimize the grid using customer-owned energy resources.
Using home batteries and energy controls to delay upgrading local distribution grids could make a big dent in the high and rising costs of electricity in California. By strategically managing energy consumption and provision to match the hour-by-hour constraints of the connected grid, PG&E and its partners aim to create a more efficient, cost-effective, and sustainable energy system for all Californians.
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