Distributed Energy

Companies Announce New Residential VPP for California

A distributed energy power plant, designed to help bring more reliability to California’s power grid, is being developed by a company whose investors include Alphabet, the parent company of Google. The project when fully developed would be the world’s largest residential virtual power plant (VPP).

Sidewalk Infrastructure Partners (SIP), a group that builds, owns, operates, and invests in advanced infrastructure projects and technology companies, on Dec. 7 released details of a $100 million deal as part of Resilia, the company’s new advanced power grid platform. The agreement includes an $80 million commitment to finance the 550-MW Resi-Station project, along with a $20 million investment in OhmConnect, a partner in the VPP.

Growth of VPP installations has accelerated, particularly in areas that have sustained rolling blackouts and power outages. A project in South Australia, with Tesla taking a lead role, was touted as the world’s largest VPP when development began in 2018.   

OhmConnect is a demand response and energy services technology company that works with residential electricity customers to predict, incentivize, and coordinate consumer energy savings. Resi-Station is expected to bring together thousands of electricity customers with in-home smart devices that can deliver targeted energy reductions supported by OhmConnect’s technology, according to SIP. The project’s investors also include the Ontario Teachers’ Pension Plan, based in Toronto, Canada, which has long been a financial supporter of institutional infrastructure projects.

“OhmConnect has shown that by linking together the savings of many individual consumers, we can reduce stress on the grid and help prevent blackouts,” said OhmConnect CEO Cisco DeVries. “This investment by SIP will allow us to bring the rewards of energy savings to hundreds of thousands of additional Californians—and at the same time build the smart energy platform of the future.”

Service for Utility Customers

OhmConnect, which was founded in 2014, makes its service available at no charge to customers of Pacific Gas and Electric (PG&E), Southern California Edison, and San Diego Gas & Electric (Figure 1).

1. The Resi-Station virtual power plant would bring together electricity customers across California to help relieve stress on the state’s power grid. Courtesy: OhmConnect

“SIP believes that energy grids must be modernized in order to orchestrate distributed energy resources,” said Jonathan Winer, co-CEO of SIP, which has headquarters in Palo Alto, California, and Brooklyn, New York. “With this distributed clean power plant, Resi-Station, we are rethinking the structure of modern power grids, allowing them to function more like a symphony than a solo … a sequence of energy-taking and energy-giving systems that communicate and cooperate with one another to deliver electricity safely, cheaply, and efficiently.”

The Resi-Station project is being launched after California experienced rolling blackouts again this year, as severe heat waves increased power demand across the state, particularly during several days in August. OhmConnect has said that at peak stress on the power grid between Aug. 13–20, the company “engaged its customers to reduce almost one GWh of total energy usage, the equivalent of taking more than 600,000 homes off the grid for an hour. OhmConnect toggled its customers’ smart devices and appliances off and on 739,000 times to save energy and reduce stress on the grid, paying out $1 million to users (Figure 2), and helping avoid additional blackouts.”

2. Electricity customers can use a smart device, such as a smartphone, to track energy usage and earnings as they participate in the OhmConnect program. Courtesy: OhmConnect

The program already is being touted as critical for power generators looking to give customers more control of their energy costs, while making the power grid more reliable, particularly in areas prone to extreme weather such as California.

Clean Energy

“Throughout my career—including my time as EPA administrator under President Clinton and White House climate advisor under President Obama—I’ve worked to promote visionary investments in clean energy. Yet the need for further action is undeniable,” said Carol Browner, the former EPA head and former director of the White House Office of Energy and Climate Change Policy. “Any Californian who has lived through the last decade of drought, wildfire and extreme weather knows the climate crisis is here. So when the private sector creates an innovative solution like Resi-Station, a major step forward in addressing these challenges, that’s something worth celebrating.”

SIP’s investment in OhmConnect—SIP led OhmConnect’s Series C capital raise, investing $20 million—should expand OhmConnect’s ability to pay California residents who conserve energy by turning off air conditioning and not using major appliances during periods of peak power demand and grid stress. OhmConnect said that at scale, Resi-Station could provide 5 GWh of energy conservation, or five times what OhmConnect provided in August, and equal to the full amount of the energy shortfall in the 2020 blackouts.

The Resilia platform will develop and scale technology and infrastructure as the power grid moves from centralized distribution to a more decentralized model. Electricity customers, using distributed resources like rooftop solar, smart devices, and electric vehicle batteries, can connect their homes to leverage the Internet of Things (IoT) to scale electricity consumption up or down to stabilize the power grid.

“OhmConnect has pioneered a powerful way to engage consumers—particularly low- to moderate-income consumers—in saving energy, including innovative programs in Alameda County with East Bay Community Energy,” said East Bay CEO Nick Chaset. “The building of Resi-Station is a critical next step in developing the clean energy grid of the future.”

SIP and OhmConnect are partnering with leading manufacturers of connected and secure home devices, including Google, and plan to offer free smart thermostats to potentially hundreds of thousands of participants in the OhmConnect software program enabling Resi-Station.

“Google Nest has long been committed to help scale consumer enrollment in demand response (DR) programs by decreasing the cost of smart thermostat devices, partnering with utilities to offer DR participation rebates,” said Jeff Hamel, director of industry partnerships at Google. “We’ve already seen how smart thermostat DR programs have helped keep the lights on in California. Large-scale consumer-powered DR programs will be a critical part of a future zero-carbon grid, and true collaboration and innovation will help them continue to become a reality.”

Customer Incentives

OhmConnect provides what it calls a “a tech-forward user experience” that will incentivize customers to reduce their electricity consumption via real-time communication prompts. As an example, a customer may receive a text (Figure 3), asking the customer to adjust their thermostat for a few hours in exchange for a reward payment.

3. An OhmConnect user could receive a text, telling them to reduce their electricity use during periods of peak demand. Courtesy: OhmConnect

SIP said that the launch of Resi-Station “is an example of SIP’s mission to identify, finance, and scale the technologies that will define the future of infrastructure. SIP plans to launch similar projects that engage distributed energy resources in an innovative way across the nation, using Resi-Station as a template.”

Darrell Proctor is associate editor for POWER (@POWERmagazine).

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