Pacific Gas and Electric Company (PG&E) and Tesla Inc. have launched a pilot programme that creates a virtual power plant (VPP) to help support electric grid reliability and save customers money.

Through this collaboration, Tesla is participating in PG&E’s Emergency Load Reduction Programme (ELRP) pilot by enrolling and combining residential Powerwall home battery systems into a virtual power plant to discharge power back to the grid in California during times of high electricity demand. Participating customers will receive compensation for the energy their Powerwalls discharge.

The new programme comes nearly a month after Tesla invited up to 25,000 PG&E customers with Powerwalls to join the VPP and help form the world’s largest distributed battery.

In the first two weeks of the new programme, more than 3,000 customers expressed interest in enrolling, with more than 1,500 customers officially participating.

The venture aims to accelerate the growing trend of customers adopting distributed energy resource (DER) technologies—which can both support customer energy needs and contribute to the reliability of the grid—by expanding access to new customer programme offerings and participation opportunities.

“VPPs are a valuable resource for supporting grid reliability and an essential part of California’s clean energy future. Our customers’ home batteries offer a unique resource that can positively contribute to our state’s electric grid and will become more significant as our customers continue to adopt clean energy technology,” stated PG&E’s Aaron August, vice president of Business Development & Customer Engagement.

“In collaborating with Tesla, we are further integrating behind-the-meter battery-based VPPs on the largest scale yet, helping to make customer resiliency technologies more accessible and continuing a long tradition at PG&E of actively integrating VPP resources into our energy supply portfolio.”

In describing the VPP programme, Tesla cites the following benefits:

The extra capacity provided by one’s Powerwall could help avoid or reduce blackouts in a severe emergency, thereby contributing to a stable grid in California

Tesla will dispatch the Powerwall when the grid is in critical need of additional power. That is when the least efficient generators would typically come online.

Powerwall will discharge during VPP events but won’t discharge below one’s Backup Reserve. The Backup Reserve can be adjusted to control contribution while maintaining backup energy for outages.

Through the ELRP pilot, participants receive $2 for every additional kWh their Powerwall provides during an event.

“Enabling Powerwall customers to support the grid and their community is a necessary and important part of accelerating the transition to sustainable energy. We seek to partner with utilities and regulators everywhere to unlock the full potential of storage to bring more renewable, resilient and less costly electricity to everyone,” stated Tesla’s Drew Baglino, senior vice president of Powertrain and Energy Engineering.

With the ever-increasing numbers of DERs coming onto the grid, grid reliability planning is becoming more of an area of interest not only in the US but across the world.

Thus the role of VPPs in the mix provides an interesting angle due to a digital presence and capability to provide a source of grid relief during times of critical need.