Network of New York Homes Forms Virtual Power Plant

A solar company and a New York utility have teamed up to install 325 home solar-battery systems, creating the state’s largest virtual power plant and testing a model that could be key to a clean and reliable power grid.

The partnership between Sunrun, the nation’s largest rooftop solar installer, and Orange & Rockland (O&R), a utility serving around 300,000 customers northwest of New York City, taps into energy from individual homes. Linked solar panel and battery systems across the area collectively function like a traditional power plant.

By sidestepping challenges that large-scale solar projects face—like siting, interconnection, and infrastructure—Sunrun is deploying residential solar and battery systems “every day and every month,” Chris Rauscher, the company’s head of grid services and VPPs, told Canary Media.

“We’re hitting a scale here that is really significant, and when you put them together in aggregations, it’s a utility-scale resource,” he added.

Sunrun approached Orange & Rockland with an offer for customers who signed up for solar: a free LG Chem battery pack or heavily discounted Tesla Powerwall, in exchange for letting the utility draw on stored energy when needed. The batteries always maintain a buffer of at least 20% for customers, writes Canary Media.

“We quickly signed up once we learned that a Sunrun solar and battery system could protect our home from outages while also bolstering the grid for our community,” said Joseph Ortiz, a customer in Rockland County. “It’s gratifying to know that—without us even lifting a finger—our home is supplying clean solar energy back to the grid to benefit everyone.”

The partnership stands in contrast to the tension between utilities and clean energy startups that is commonplace in the industry. It receives funding from New York State, which embraced it as a 10-year trial run for drawing power from household energy devices.

So far, the network only makes up about two megawatts of aggregated capacity. But it was used 18 times over the past summer to send power back to the grid. It is also a test run for a system that could be expanded to support the grid’s transition away from fossil fuels, and lessons learned may help improve the grid without capital-intensive upgrades.

About a dozen more solar-battery systems are scheduled before the project’s installations wrap up by the end of the year. In the meantime, O&R is tracking data on the rates at which batteries respond, and their effects on lowering demand peaks and deferring grid updates. The information is being shared with regulators.

For the project to expand, the partners will have to figure out how to keep enticing customers while acknowledging that the current main incentive—a free or discounted battery—is not financially sustainable in the long term, Canary Media writes.

“We can’t give everyone a free battery,” said Christian Woods, O&R’s energy storage project manager. “It’s that cost-benefit analysis—what is an amount that would get people interested, and as the utility, we’re not completely losing our shirts?”