Sunrun, Tesla and Renew Home could deliver nearly 17 GW of distributed energy capacity to unlock headroom in an increasingly congested U.S. power grid, the companies said Wednesday.
The three companies say they can provide 16.8 GW of capacity across 12 million devices in 9 million U.S. homes. Sunrun and Tesla manage 7.8 GW of installed battery capacity and Renew Home has about 9 GW of HVAC capacity based on its smart thermostats’ one-hour peak load shift potential, the companies say.
In Texas, which Rauscher said is the country’s second largest data center market, the companies have 1.3 GW of HVAC capacity and 440 MW of battery capacity. They have nearly 1.1 GW of HVAC capacity and 3.6 GW of battery capacity in California, the country’s third largest data center market.
Power system experts have been talking for years about the “theoretical” potential for distributed resources to unlock headroom on the grid, but “I don’t think anyone realizes the scale of the resource available right now,” Ben Brown, Renew Home’s CEO, told Utility Dive in an interview.
In Virginia, home to one of the world’s largest commercial computing clusters, Sunrun, Tesla and Renew Home have 37 MW of batteries and 276 MW of HVAC capacity. They expect the combined capacity there to reach 500 MW by 2030.
“It takes a lot of time to build utility scale solutions,” said Mary Powell, chief executive of Sunrun, who once ran an electric utility in Vermont. “We’re sitting on top of solutions right now.”
Utilities generally have enough spare capacity to serve new data centers most of the time but not when demand for electricity is very high, including during heat waves and cold spells. Energy and technology executives have been struggling for years to figure out how to to power data centers when grids are under strain.
Building new power lines and energy generators, including natural gas power plants or solar farms, can take years and cost billions of dollars. And under current federal and state rules, those costs are typically passed on to everybody who uses electricity, including individuals, on monthly electricity bills.
Sunrun, Tesla and Renew Home assert that at least some of that new spending is not needed or can be put off for years. Home energy devices can effectively be knitted together to serve as a virtual power plant, in industry jargon. But unlike actual power plants, such systems can also store or use energy. Thousands of thermostats can be adjusted by a degree or two to reduce or increase energy use, depending on what is best for the grid.
“It’s really a paradigm shift with the way we operate the electricity system,” said Leah Stokes, an associate professor of political science at the University of California, Santa Barbara, who specializes in energy and environmental policy. “Maximizing these smart devices is a huge way to unlock value across the grid.”
Dr. Stokes said the California program provided the equivalent of a nuclear power plant’s capacity, or enough to run a large data center. Sunrun, Tesla and Renew Home said their private partnership could provide 16 times as much electrical capacity as California’s program across the United States during periods of high demand and be up and running in months.
“We have eight million devices enrolled in six million homes,” said Ben Brown, chief executive of Renew Home, which manages thermostats, water heaters and other devices. “That itself is such a large scale. It helps the challenge.”
An added benefit: When the companies tap residential devices, individuals receive cash payments or credits on their electric bills. Last year, Sunrun and Renew Home paid individuals $67 million.
Your home offers another solution to the energy shortage. The concept is simple. When thousands of homes are coordinated together by software into what are known as distributed or virtual power plants (VPPs), they can deliver or free up a power plant’s worth of electricity for the grid by dialing down consumption from smart appliances like electric water heaters or dispatching electricity from home batteries. This approach can bring hundreds of megawatts online in months, not the years it can take to build a new power plant.
Transmission lines move electricity through space to where it’s needed. VPPs deliver power the moment it’s needed most. The grid tends to run at half capacity, because it’s built for peak demand, so storing cheap off-peak power and discharging it when demand spikes effectively creates new capacity. Home batteries can recharge later using cheap power — often wind and solar — as demand ebbs.
Last July, the largest residential test in U.S. history delivered 535 MW in California, enough to power half of San Francisco for two hours, from more than 100,000 home batteries in California. Building equivalent capacity from natural gas plants would cost twice as much, estimates the U.S. Department of Energy.
Last month, Google announced that its new Minnesota data center will help fund thousands of small, utility-owned batteries for homes and businesses across Minnesota, a VPP that will be part of 1,900 megawatts of new clean energy capacity powering the facility.
“We’re seeing a direct line of sight between a company building a data center and investment in infrastructure in people’s homes and businesses,” said Mark Dyson of the clean energy think tank RMI, who co-authored a report on how household upgrades can power data centers. “VPPs have been waiting around for a pile of cash and a crisis, and now we have both.”