Rooftop Solar & Virtual Power Plants Take Center Stage – CleanTechnica

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Another storm, another black eye for oil and gas as Hurricane Francine leaves a trail of destruction in its path across the Gulf of Mexico from Texas to Louisiana. What to do? Advocates for rooftop solar panels and virtual power plants have one answer. With the addition of energy storage, solar-enabled ratepayers can power their way through an emergency individually with clean kilowatts, and they can also lend a hand collectively by enrolling in a virtual power plant.

Money Talks: Rooftop Solar Meets Virtual Power Plants

The virtual power plant phenomenon has been building momentum for about 10 years now, and it’s about to go mainstream. In one early iteration, ratepayers get a tipoff from their utility when electricity demand is at risk of surging. If enough of them dial down their consumption, the local utility can avoid brownouts and blackouts.

In effect, ratepayers collectively act like a virtual power plant and reducing, if not eliminating, the need to build additional (and expensive) real-life power plants to handle spikes in demand. The electrification movement has added even more fuel to the virtual power plant fire, by drawing heat pumps, home energy storage systems, EV charging stations  and other electrical appliances into the equation (see more VPP background here).

Now that rooftop solar panels and home energy storage units have reached mainstream mass, virtual power plants can handle more sophisticated tasks, and utilities are beginning to reward ratepayers who harvest clean energy from their rooftop solar panels and contribute those kilowatts to the collective grid when needed.

In Texas, for example, the diversified energy firm Vistra has just tasked its TXU Energy branch to launch a new incentive program called Battery Rewards, in partnership with the leading solar installer Sunrun.

The TXU Energy & Sunrun Battery Rewards program will “aggregate power stored in residential, solar-connected batteries, forming a virtual power plant to dispatch energy back to the grid when it’s needed the most,” the partners explain.

The virtual power plant is being formed on an opt-in basis. Vistra and Sunrun seem confident that the financial incentive will provide ratepayers with enough motivation to participate. They also emphasize that the ratepayer continues to control their own energy storage system, in case they need to deploy it at home.

In effect, the virtual power plant also functions as a type of community solar program. Community solar refers to local solar arrays that nearby residents can access on a subscription basis. That enables everyone in the area to get clean power — often at lower rates, nowadays — even if they don’t have the opportunity or desire to install their own rooftop solar panels.

The community well-being angle is an especially important one in mixed neighborhoods where many ratepayers are unable to install their own solar-plus-storage systems, either for lack of a suitable roof or lack of financial resources.

Rooftop Solar & The Power Of Net Metering

For anyone with politically partisan qualms about the idea of deploying one’s personal resources to take collective action (socialism!), the VP of energy transition solutions at Vistra, Sam Sen, has a message for them: Get over it.

“With the growing population and increasing demand on the grid, harnessing the collective power of home solar panels and batteries is an important expansion of our distributed energy initiatives,” he said in a press statement.

“These customers can also continue to benefit from TXU Energy’s solar buyback plans, which credit solar energy system owners for the electricity they add to the grid,” Vistra and Sunrun also note, emphasizing the financial benefit.

The collective nature of the Battery Rewards program also supports the case for strong net metering programs. Net metering refers to the ability of solar-enabled ratepayers to sell their electricity back to the grid, and home energy storage systems adds a new level of 24/7 availability.

Some utilities argue that net metering rewards the affluent who can afford their own solar plus storage systems, at the expense of everyone else on the grid. In contrast, with the virtual power plant angle in hand, TXU aims to prove that the individual benefits of rooftop solar plus storage can also benefit the whole community.

“Since we introduced solar net metering to Texans 15 years ago, rooftop solar has seen significant growth, marked by over $10 million in solar buyback credits paid to our customers last year alone,” Vistra explains, emphasizing the individual benefit.

On its part, Sunrun adds that virtual power plants are becoming more popular. The company states that its roster of virtual power plants has grown to 12 across multiple states so far.

Expanding The Reach Of Virtual Power Plants

Although the politically conservative oil and gas-producing state of Texas may seem like the last place in the US where a utility would incentivize rooftop solar plus storage, Texas state lawmakers from years past laid a firm economic platform for net metering and other renewable energy-enabled innovations. The current crop of Texas officeholders has made a few feeble attempts to dismantle it, but their war against renewable energy has fallen flat.

Most states in the US also enable some form of net metering or are transitioning to alternative forms of compensation. The big question is how to make it easier for ratepayers to tie the collective power of their rooftop solar panels and energy storage systems into a virtual power plant.

Aside from the Vistra/Sunrun hookup, another firm to introduce a new solution is the software-centric firm GoodLeap. The company, which bills itself as one of the fastest-growing virtual power plant networks in the US, GoodLeap focuses its “GoodLeap” software on ratepayers who are currently served by grids identified as stressed.

“GoodGrid has already deployed energy to help alleviate six ‘stress’ events in the California Energy Commission’s (CEC) Demand Side Grid Support (DSGS) program, where utility consumer energy demand exceeded capacity,” GoodLeap explains.

GoodLeap also notes that virtual power plants go beyond rooftop solar and storage hardware to include demand-side electric appliances including HVAC equipment, EV charging, heat pumps, and water heaters.

As with Vistra, GoodLeap’s Chief Strategy Officer, Dan Lotano, underscores the collective benefits. “Utilities and grid operators are exploring every solution possible to keep the lights on in their communities without burdening consumers with unaffordable rates,” he explains. “Many homeowners have already installed the battery solutions and now we’re leveraging our GoodGrid technology to bring all the key stakeholders together to create additional value for everyone.”

More Rooftop Solar, More Virtual Power Plants

Want to see some virtual power plant action on your grid? The nonprofit organization Solar United Neighbors, which began life as an effort by two teenagers to sign their neighbors up for rooftop panels, has blossomed into a full blown resource and advocacy program to accelerate the virtual power plant trend as a matter of bottom line benefits for ratepayers and their utilities.

SUN is not just blowing hot air. The organization, which prefers to use the more descriptive term “Distributed Power Plant” instead of virtual power plant, has the receipts.

“According to a 2023 study by the Brattle Group, a DPP [distributed power plant] costs roughly 40–60% less than alternative options to provide power,” SUN notes.

“An estimated 60 GW of DPP deployment would save ratepayers $15–$35 billion over the ensuing decade,” they elaborate, adding that “60 GW is enough energy to provide power to 7.5 million homes.”

Like other virtual power plant advocates, SUN also draws attention to piggybacked benefits of encouraging individuals to invest in rooftop solar and and energy storage, including reducing pollution from power plants and improving grid reliability in case of demand spikes and other disruptions.

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Image (cropped, courtesy of US Department of Energy): The rooftop solar and home energy storage trends are pushing the case for virtual power plants, in which individual ratepayers take collective action to improve grid resiliency (socialism!).