Now is the Time to Embrace ‘Virtual Power Plants’: Here’s Why

The energy transition is one of the most complex undertakings in human history, but one thing is clear — the grid of the future will be cleaner, more decentralized and more flexible.

This vision has been coming into focus for several years now, as price declines and unprecedented public and private investment in solar, storage, electric vehicles and other distributed energy resources have enabled exponential adoption curves. And most signs suggest that the trajectory will continue.

This will entail a monumental change in the physicality of the grid and how customers interact with it. More and more customers generate or store more of their energy instead of buying it from the grid. Also, utilities and grid operators must balance increasing demand growth, even as extreme weather events become more frequent.

Leading the Charge for VPPs

CPower has prepared for this moment since its start in 2014. Founded with a focus on legacy demand response, CPower has always sat at the intersection of customers and the grid. As the use and capabilities of DERs have expanded over time, our leadership in demand response has made us a trusted resource for helping customers, utilities and grid operators navigate the new opportunities that DERs provide.

Our more recent emphasis on virtual power plants may come off as a pivot but it’s just a matter of semantics. The industry itself hasn’t coalesced around the term “VPP” until recently and even now some debate remains around how VPPs are defined.

However, there is a clear throughline from the demand response programs that CPower has always offered to VPPs, which are aggregations of DERs that provide grid services via coordinated dispatch. Regardless of how you define VPPs, CPower has been a leader in the space since long before the industry widely adopted the term. We have been aggregating customer assets and dispatching them to help the grid for years.

The importance of our position between energy users and the grid has grown alongside the increasing adoption of DERs. We aim to distill the mind-boggling complexity of the grid and energy markets so that everyone from facility managers to asset portfolio managers can recognize the full potential of their DERs through a VPP.

The growing embrace of the VPP — both the term and the concept — makes that work easier. This embrace is exemplified by the Department of Energy’s push to triple VPP deployments by 2030, which dovetailed with the launch of industry coalitions like the VP3 partnership.

Helping Customers Help the Grid

We also felt it was important for CPower to go all-in on VPPs because — given our primary focus on commercial and industrial energy users — we’re in a good position to paint an accurate picture of their potential. For instance, many think of them only in terms of residential assets, but commercial and industrial DERs are the heavy hitters in terms of benefits that VPPs can provide to the grid — both now and into the future.

As a longstanding leader in the evolving VPP industry, we are well-poised to help turn the potential of VPPs into reality. We are helping regulatory stakeholders understand how to fit VPPs into existing regulatory models, leveraging AI to make hourly DER optimization across multiple markets and programs a breeze and demonstrating the impact of VPPs in maintaining reliability when it matters most.

We have also convened industry stakeholders to tackle the top issues and trends in VPPs and the energy transition, including leaders from the DOE, DER providers and commercial and industrial energy users. In doing so, we have paved the way for a better tomorrow by turning knowledge into action.

As one of the first companies to monetize DERs — and with more than a decade of experience aggregating and managing customer assets — CPower is the connective tissue that our energy system needs to scale VPPs and realize our clean energy and reliability goals.

Every day, in everything we do, we enable the larger, more decentralized and more flexible grid of the future. The vision is increasingly clear — and VPPs are bringing it into focus.

Michael Smith

Michael Smith is a visionary and innovative leader who brings more than 25 years of leadership experience in the energy industry to CPower as its CEO. Michael joined CPower from ForeFront Power, where he was the CEO of the company’s North American solar and energy storage business, responsible for strategy and all business areas across the U.S. and Mexico.

Prior, Michael served as Senior Vice President, Distributed Energy, at Constellation, the retail energy subsidiary of Exelon Corp., where he was responsible for Constellation’s distributed solar, energy efficiency, and energy asset operations businesses across the U.S. He also served as Vice President, Innovation and Strategy Development, for Exelon Generation, and led Constellation Technology Ventures, Exelon’s venture investing organization. Earlier, Michael was Vice President and Assistant General Counsel for Enron Energy Services and a trial lawyer at Bricker & Eckler, LLP.