Tesla is launching its own virtual power plant with the Powerwall in California in order to help the grid, which is expected to be under pressure this year.

A virtual power plant consists of distributed energy storage systems, like Tesla Powerwalls, used in concert to provide grid services and avoid the use of polluting and expensive peaker power plants.

Tesla launched such an initiative in Australia in partnership with the local government in an attempt to reduce electricity rates.

In the US, several companies, like Swell, have used Tesla Powerwall battery packs to build their own virtual power plants and offer grid services to electric utilities.

Now, Tesla is launching its own virtual power plant in California to help the state’s grid:

“The California grid operator forecasts a continued need for Californians to support the grid through 2021. Help create the largest distributed battery system in the world and avoid dependence on the least efficient fossil fuel power plants. Opt-in to the Tesla Virtual Power Plant (VPP), and Tesla will dispatch your Powerwall when the grid needs support while continuing to maintain your energy security.”

California’s grid is expected to have an exceptionally difficult few months, with record high temperature increasing energy demand on the grid and a significant drought affecting hydropower plants, like the Hoover Dam:

Tesla plans to enable homeowners in California who currently have Powerwalls to opt into the virtual power plant program and allow some capacity of their energy storage to provide power to the grid.

The company lists some of the benefits of joining the Tesla virtual power plant (beta):

  • Stabilize California’s Grid: The extra capacity your Powerwall provides could help avoid or reduce blackouts in a severe emergency. This way, Powerwall can keep the lights on for both you and your community.
  • Clean the Grid: Tesla will dispatch your Powerwall when the grid is in critical need of additional power. That is when the least efficient generators would typically come online.
  • Unite as a Tesla Community: Team up with other Powerwall owners who are accelerating the world’s transition to sustainable energy and help form the largest distributed battery in the world — potentially over 50,000 Powerwalls. As part of the VPP, your Powerwall will have an outsized positive impact on the grid over traditional demand response programs.
  • Keep Your Energy Security: Powerwall will discharge during VPP events but won’t discharge below your backup reserve. Adjust your backup reserve to control your contribution while maintaining backup energy for outages.
  • Export Credits During Peak Periods: You don’t need to change your home energy usage behavior to participate. Additionally, if you’re part of a net energy metering (NEM) program, you may earn net metering credit for your energy sent to the grid during events.

Tesla plans to open up enrollment into the VPP through its mobile app starting on July 22. We will be on the lookout for all the details on eligibility.

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