In a groundbreaking initiative aimed at strengthening California's beleaguered electrical grid, Sunrun (Nasdaq: RUN) has launched the largest virtual power plant in the United States. By networking over 16,200 solar-plus-storage systems from its customers, Sunrun's CalReady power plant is set to provide essential load generation during extreme weather events, thereby reducing the risk of blackouts and cutting energy costs across the state.
This pioneering effort comes as part of the California Energy Commission's Demand Side Grid Support program, which seeks to enhance grid reliability during heat waves, wildfires, and other critical periods. Sunrun's involvement, now in its second year, has already shown promising results. In the summer of 2023, the company's Peak Power Rewards program delivered up to 32 megawatts of power from 8,500 customers’ batteries to Pacific Gas and Electric Company (PG&E) during peak hours. This year, Sunrun aims to double both its capacity and participant numbers, significantly amplifying its impact.
Mary Powell, CEO of Sunrun, emphasized the revolutionary nature of this customer-driven clean energy initiative. "Our customers are leading the charge towards a cleaner, more affordable energy future. By contributing their solar power, they are not only reducing the strain on California’s grid but also setting a precedent for what the future of energy distribution should look like," Powell said. The CalReady virtual power plant, she added, stands as a testament to the power of collective action in creating a resilient energy infrastructure.
As part of the Strategic Reliability Reserve, the Demand Side Grid Support program leverages tens of thousands of batteries from various aggregators, including Sunrun, to stabilize the grid. This approach not only mitigates the risk of rolling blackouts but also provides a seamless experience for participants. Sunrun monitors and dispatches the stored energy from customers' batteries, compensating them for their contributions while ensuring they retain a minimum backup reserve of 20% for personal use.
Chris Rauscher, Sunrun’s Head of Grid Services, highlighted the scalability and efficiency of the virtual power plant model. "Sunrun’s fleet of batteries can be orchestrated in unison, similar to a centralized fossil fuel power plant, but with the added resilience and adaptability of being distributed across numerous households. This decentralized approach enhances both the speed and reliability of our energy solutions," Rauscher explained.
From May through October, when the demand for energy is highest, Sunrun's CalReady will be available daily from 4 to 9 p.m. During this period, the California Energy Commission may call upon Sunrun’s systems up to 35 times to supply supplemental energy. With ongoing enrollment and proactive customer outreach, participation in CalReady is expected to continue growing, further solidifying Sunrun's role as a key player in California’s clean energy landscape.
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