CEO Michael D. Smith knew CPower was a leading enabler of the energy transition when he took the helm a year ago, but he has since learned the extent of that role.

As the nation’s largest virtual power plant (VPP) provider, CPower boosts grid reliability while helping customers unlock the full value of their distributed energy resources (DERs). In aggregating DERs and dispatching them as VPPs, CPower helps customers earn revenue and reduce energy spending by providing services that grid operators need to avoid blackouts. Grid operators pay energy users to help keep the grid balanced, like by using less electricity or supplying power from distributed generation.

Smith has been a leading proponent of VPPs since he became CPower’s CEO in July 2023, broadening awareness of how energy users, particularly commercial and industrial customers and DER Project Owners and Developers, can help the grid transition to clean energy—and be rewarded for doing so.

A year after his first interview with The Current, Smith reflected on how far CPower and VPPs have come and discussed where they are going.

1. The Current: What has surprised you most about your first year at CPower?

Smith: One is the complexity of the industry. Not being a veteran of demand response and virtual power plants, it was eye-opening to learn how complex of a proposition it is to simplify grid services for our customers and make it easy for them to interact with the power grid.

Secondly, every customer is unique, and we must customize our approach accordingly. They each have their own operating parameters and concerns about how participating in a VPP might impact those operating parameters.

For example, if a customer has a large industrial load that powers their operations, you don’t want to impact the industrial process that is their lifeblood. You must work with them to figure out ways to be responsive to grid dispatch without disrupting their core processes.

We’re good at working with each customer to put them in programs consistent with their unique operating characteristics. We know the particulars of the different industries we serve and the needs of the individual customers within those industries.

One big-box retailer may differ from another, for example, in terms of what their motivations are and what they can and cannot do. Industrials will differ from a college campus. So, having those one-on-one relationships with customers is hugely important. That’s our secret sauce.

2. The Current: What are some memorable moments that have stood out to you over the past year? 

Smith: GridFuture was a great milestone for us. Not just because we were looking inward and bringing all our employees together for the first time in four years, but also the outward-facing nature of the event with the inclusion of the U.S. Department of Energy, LS Power and its portfolio companies, our customers and our partners. It made for a fantastic event whose benefits were two-fold.

Internally, there was the engagement of the 200 employees that participated. They were excited to be with their peers and talk about their business and where the industry is headed.

Externally, it validated our ability to attract outside thought leaders who are important to our business and have an interest in our industry. That says a lot about the CPower brand and the interest in the growing importance of VPPs in helping the grid.

And although GridFuture was one of the most memorable moments, it has been one of many enjoyable experiences getting to know the CPower team. Our monthly ‘Get CPowered Days’ in Baltimore have been a great way to bring everyone together on a regular basis.

Many of our employees work remotely or out of offices other than our headquarters in Baltimore. Frequently bringing distributed team members together has fostered face-to-face interactions and relationship building that have further boosted employee engagement, which is vital. We can’t expect to provide world-class service to our customers and our grid partners if we don’t have a highly engaged workforce.

3. The Current: A year ago, you spoke about how the industry was evolving, particularly regarding how the physicality of the electric grid was changing as more customers generated their own energy. Has this trend evolved and how is CPower addressing it?

Smith: The single biggest trend in the energy markets right now is load growth. We’re coming out of approximately 10 years without significant growth in demand. In fact, in some regions of the country, demand shrunk, particularly during COVID.

Now, we’re seeing demand grow rapidly, and it’s in large part because of the participation of some key commercial organizations including data centers, crypto miners and companies that are tapping into artificial intelligence. Computing, mining and all the data that is being used for AI are creating macro growth in overall load, especially in burgeoning data center hubs like Ohio, Illinois and Virginia.

These energy users can also come online much quicker than new power plants can be built. That creates a supply-demand imbalance and that’s what we solve.

We give the grid operators much more efficient and effective tools to manage supply-demand imbalance than building new power plants and associated transmission lines.

Also, in addition to supporting grid stability in an era of demand growth, we support further electrification of buildings and vehicle fleets, and the deployment of on-site renewable generation and energy storage.

All these macro trends point to the need for VPPs, and we support them by being good at connecting our customers’ capabilities with the grid’s needs.

4. The Current: What is flexible participation? And why does it matter to grid operators and customers? 

Smith: Our bread-and-butter is a capacity product where the grid pays us, and therefore our customers, to be available in times of grid stress. Grid operators rely on our customers to reduce their loads during emergency conditions.

However, grid needs have changed and continue to do so. Grid operators need much more help than just asking commercial and industrial customers to conserve electricity during emergencies like peaks in summer electricity demands.

Compounding factors drive a greater need for grid flexibility to smooth the energy transition, including issues such as retiring fossil-fuel generators, more wind and solar generation, accelerating vehicle electrification and more extreme weather events.

With all these factors in play, the grid must adapt to shifts in supply or demand more quickly and frequently to keep them balanced and avoid blackouts. This increasing need for flexibility shows up in all the products and programs grid operators use to ensure the system remains in balance—including energy, capacity, ancillary services and bespoke programs.

We offer flexible programs where customers can get paid to provide energy to the grid in times of need. That could be in response to an energy price signal or to support shorter disturbances to help stabilize the grid, like a car’s shock absorber.

Flexible participation is taking part in those energy and ancillary services programs. Customers generally need to be able to react more quickly than in emergency capacity programs.

Flexible participation programs also need customers to be able to react more frequently than in the emergency capacity markets, but they can earn additional revenue streams by participating.

Although any business or organization that has a box with lights, air conditioning and electricity going to it can be part of our virtual power plants, some industries have larger, more flexible loads that can be more useful to grid operators and more rewarding for customers.

For example, we talked about interruptible computing, which includes data centers, crypto and AI customers that have flexible loads. Big-box retailers with multiple sites in multiple states also have a lot of flexibility in their loads, particularly for adjusting their lighting or HVAC systems without interrupting operations or inconveniencing customers or employees. They have a huge opportunity to help the grid.

5. The Current: Let’s look into your crystal ball for a moment. Any predictions for CPower or the industry ahead?

Smith: The industry itself will continue to grow and we will continue to grow along with it as the need for grid flexibility increases and the benefits of VPPs multiply.

According to the U.S. Department of Energy, deploying 80-160 GW of VPPs—tripling current scale—by 2030 could expand the U.S. grid’s capacity to reliably support a ~60 GW rise in coincident peak demand while avoiding $10 billion in annual grid costs. Other research shows that relying on customer-sited DERs that make up VPPs is up to 60% more cost-effective than using gas power plants.

VPPs can also be created quickly by tapping existing resources. They will only become more common and expansive as grid operators realize that they typically take less than a year to stand up and customers see that they can start receiving the benefits of participating shortly thereafter.

As the demand for VPPs rises, CPower and its customers will be there to meet it.

To learn more about VPPs and how CPower can help you monetize your energy assets while supporting sustainability, improving grid reliability and increasing energy resiliency, call us at 844-276-9371 or visit CPowerEnergy.com/contact.

We’re excited to have our technology partner, Auradine contribute this guest column for The Current.

In an era of continuously rising energy consumption, the need for efficient and sustainable energy management solutions has never been more critical. Demand response programs, particularly those that require extreme flexibility and near instantaneous reactions from energy users, are emerging as pivotal components in modern energy systems because they offer a dynamic method to balance supply and demand, enhance grid stability, and promote energy efficiency.

Interestingly, Bitcoin mining, traditionally seen as an energy-intensive process, is an integral part of this initiative. The Bitcoin miners at the center of the almost-immediate-response evolution are earning revenue, reducing costs, and helping the power grid by taking advantage of energy providers’ most flexible demand response programs through a combination of cutting-edge, innovative technologies and collaborations with virtual power plant (VPP) providers.

Rapid demand response relies on energy systems’ capability to adjust real-time consumption patterns based on supply conditions. Unlike traditional demand response involving scheduled adjustments, more flexible demand response leverages advanced technologies to provide instantaneous feedback and actions. This capability is essential for integrating renewable energy sources, managing peak demand and ensuring grid reliability.

According to the International Energy Agency (IEA), demand response is vital in modern energy systems because it reduces the need for additional generation capacity, avoids greenhouse gas emissions, and provides economic benefits by optimizing energy usage. The IEA emphasizes the importance of integrating demand response into energy efficiency strategies to achieve a sustainable energy future.

Bitcoin Mining: A Leader in Flexible Demand Response

Although Bitcoin mining, the process of validating transactions and securing the Bitcoin blockchain through complex mathematical computations, has been scrutinized for its significant energy consumption, its flexibility and high responsiveness to energy availability make it ideal for the most flexible of demand response programs, which reward customers with more revenue for curtailing their resources in reaction to grid needs in seconds, not hours.

Unlike in many other industries, Bitcoin mining operations can be swiftly adjusted or paused in response to grid signals, thus providing a unique form of demand response. During periods of excess energy supply, Bitcoin miners can ramp up operations to consume surplus electricity that would otherwise go to waste. Conversely, mining activities can be scaled back or halted during peak demand periods, freeing up energy for other uses.

Auradine’s EnergyTune™ technology is at the forefront of integrating Bitcoin mining into the fastest-acting demand response framework. This advanced system utilizes machine learning algorithms and real-time data analytics to optimize energy consumption for Bitcoin mining. EnergyTune™ can seamlessly adjust power usage in response to grid signals within seconds.

Bitcoin miners can dynamically adjust their computational power based on real-time grid conditions. This ensures that mining activities are conducted during periods of low energy demand or high renewable energy availability, thereby minimizing the environmental impact and improving overall energy efficiency.

VPP providers such as CPower Energy are essential partners in the flexible demand response ecosystem for Bitcoin mining. In aggregating distributed energy resources (DERs), such as solar panels, batteries, and flexible loads, that can be dispatched as needed, VPPs provide reliable and scalable demand response services.

CPower, for instance, leverages its extensive network of DERs to offer near-real-time demand response solutions. By integrating with technologies like EnergyTune™, CPower can optimize the performance of its VPPs, thereby ensuring that energy resources are utilized efficiently and effectively. This collaboration enables a more resilient and adaptive energy system capable of rapidly responding to fluctuations in supply and demand.

Benefits of Rapid Demand Response Grid stability and reliability: Rapid demand response helps balance supply and demand within seconds, reducing the risk of blackouts and enhancing the overall stability of the grid. This is particularly important as the share of variable renewable energy generation, such as wind and solar, continues to grow. Environmental impact: Demand response reduces greenhouse gas emissions by minimizing reliance on fossil fuel-based power plants during peak periods. This aligns with global efforts to combat climate change and transition to a clean energy future. Enhanced energy efficiency: Demand response promotes more efficient energy consumption patterns, which reduce waste and extend the lifespan of energy infrastructure. More revenue for miners: By participating in the most flexible demand response programs, Bitcoin miners can receive greater financial incentives from utilities and grid operators for adjusting their energy usage in response to grid conditions. For example, they can earn tens of thousands of dollars per MW through ancillary services, regulation capacity, frequency regulation and economic and synchronized reserves programs, which require customer resources to respond within seconds or minutes. During periods of high energy demand, miners can reduce or halt their operations, selling their allocated energy back to the grid at premium rates. During low demand or excess renewable energy supply periods, miners can capitalize on cheaper electricity costs to maximize their mining activities. This dual capability not only enhances the profitability of Bitcoin mining but also contributes to grid stability and efficiency, creating a symbiotic relationship between energy providers and miners.

The Path Forward for Flexible Demand Response and VPPs

Flexible demand response programs requiring rapid customer reactions are poised to be pivotal in transforming energy management. By integrating Bitcoin mining into the framework for rapid demand response and leveraging technologies such as Auradine’s EnergyTune™, the energy sector can achieve greater efficiency, stability, and sustainability. Collaboration with VPP providers such as CPower further underscores the potential to revolutionize the energy landscape.

A coordinated approach involving all stakeholders is essential for realizing demand response’s full potential. The most flexible demand response programs, in particular, can lead the way to a more resilient and adaptive energy future through continued innovation and collaboration—and Bitcoin mining is doing its part.

Calendars may show that summer didn’t start until June 20, but thermometers across the country in the past few weeks have suggested otherwise. From heat domes in the Southwest to record-high temperatures in the Northeast, summer electricity needs kicked in early—and grid operators are bracing for another few hot months.

Although grid operators and federal regulators expect to have enough resource capacity to weather a typically hot summer, some parts of the U.S. are at risk of power shortages if the mercury shoots higher and stays there longer.

Markets served by the Midcontinent Independent System Operator (MISO), ISO New England and Electric Reliability Council of Texas (ERCOT) could face summer electricity shortages in extreme summer conditions, according to the North American Electric Reliability Corp. (NERC) 2024 Summer Reliability Assessment.

NERC has recommended that at-risk areas take precautions such as reviewing seasonal operating plans and protocols for communicating and resolving potential supply shortfalls. It has also noted that many assessment areas have expanded demand-side management programs to give grid operators more resources to reduce electricity demand if it exceeds supply.

When temperatures spike, grid operators could turn to energy users to help keep the lights on in communities. If they do, customers that make their distributed energy resources (DERs) available to grid operators as virtual power plants (VPPs) could benefit as a result.

In aggregating customer DERs and dispatching them together, VPPs are an effective and cost-efficient way to quickly balance the grid. So, they could be a go-to resource for grid operators with resource adequacy concerns this summer.

Here’s what grid operators and regulators project the summer’s electricity needs to look like so far.

Source: North American Electric Reliability Corp. (NERC) 2024 Summer Reliability Assessment.

Summer Electricity Outlook by Market

Click on one of the markets below to go directly to that section.

• • California Independent System Operator (CAISO)
  • Electric Reliability Council of Texas (ERCOT)
  • ISO New England (ISO-NE)
  • Midcontinent Independent System Operator (MISO)
  • New York Independent System Operator (NYISO)
  • PJM

California Independent System Operator (CAISO)

The California Independent System Operator (CAISO) has a positive Summer Outlook for 2024 due to several factors.

• • A total of 9,071 MW of capacity is expected to have been added to the state’s grid since Sept. 1 or to go online by June 30.
  • Average conditions for producing hydropower and a softening of the summer 2024 load forecast peak demand should more than offset generator retirements.
  • Although weather forecasts show an increased chance of above-normal temperatures across interior California, there is less likelihood of higher-than-usual temperatures in coastal areas, especially Southern California.

After considering all factors, CAISO expects to have sufficient resources to meet forecasted demand plus an 18.5% reserve margin for all summer months in 2024. It also anticipates a surplus of at least 3,438 MW over forecasted demand plus the 18.5% reserve margin during peak net load hours of 6 p.m. to 10 p.m. in September.

Emergency Programs in Place

However, CAISO has also warned that “extreme drought, wildfires and continued potential for widespread heat events and other disruptions continue to pose a risk for emergency conditions to the ISO grid.” Therefore, the ISO is preparing strategic reserves and emergency programs for this summer.

California demand response programs that could be called upon include the Emergency Load Reduction Program (ELRP) and Demand Side Grid Support (DSGS) Program. ELRP pays energy users for reducing consumption during grid emergencies and DSGS incentivizes electric customers to provide load reduction and backup generation when extreme events occur, like heatwaves.

DSGS is a new program meant to prevent summer power outages, specifically between May and October. It is part of California’s Strategic Reliability Reserve, a suite of programs to alleviate tight energy supplies on the grid caused by heatwaves, wildfires and other ongoing impacts of climate change.

through eligible providers like demand response aggregators. Participating customers can receive payments for help such as reducing load, putting combustion resources on standby or providing remotely controllable generation like backup generators powered by biomethane, natural gas or diesel.

Electric Reliability Council of Texas (ERCOT)

NERC has warned that the Electric Reliability Council of Texas (ERCOT) market could be at risk of power outages due to a decrease in available generation. Conventional generation resources like fossil-fueled power plants are being retired and the state is increasingly dependent on variable energy resources.

Risk is highest during off-peak or net-peak hours in areas dependent on renewables, like solar or wind generation, NERC has noted. With solar and wind accounting for growing shares of the state’s generation mix, ERCOT must replace renewable energy that is not available when the sun does not shine, or the wind does not blow.

“Continued robust growth in both loads and intermittent renewable resources has elevated the risk of emergency conditions in the evening hours when solar generation begins to ramp down,” according to NERC’s summer reliability assessment. “ERCOT’s probabilistic risk assessment indicates an elevated risk of having to declare [energy emergencies] during hours ending 8:00–9:00 p.m. Central on the August peak load day.”

The risk could rise further if ERCOT needs to limit power transfers from South Texas into the San Antonio region when demand peaks. Demand could overload the lines that make up the South Texas export and import interfaces, necessitating South Texas generation curtailments and potential firm load shedding to avoid cascading outages. “The risk is greatest when ERCOT has extremely high net loads in the early evening hours,” NERC noted.

So, even though ERCOT expects to have sufficient resources to meet operating reserve requirements for the peak demand hour scenario, NERC noted that there is risk of supply shortages as solar generation ramps down during the early evening hours when system load is high and transmission constraints limit transfers.

According to NERC, ERCOT expects to have nearly 3,500 MW of demand response resources available this summer, the equivalent of 4% of normal peak demand. ERCOT and utilities offer demand response programs for Texas energy users.

The ERCOT Contingency Reserve Service (ECRS) is the grid operator’s newest demand response program. Available in 2024, the new ERCS program is like the LR program in that resources must respond within 10 minutes of being dispatched. They must also sustain their performance for “as long as they have the responsibility to provide this service.”

ISO New England (ISO-NE)

New England’s grid operator, ISO-NE, anticipates meeting peak demand for electricity this summer. Assuming typical weather conditions. ISO-NE predicts electricity demand will reach 24,553 megawatts (MW).

However, above-average summer weather, such as an extended heat wave coupled with high humidity, could push demand up to 26,383 MW. This could tighten supply margins because the ISO anticipates having about 30,000 MW of capacity available to meet demand and required reserves.

ISO-NE will have less capacity this summer than last because two natural gas-fired generators (with a total summer capacity of 1,400 MW) were retired in May. “This makes it more likely that ISO New England will need to resort to operating procedures for obtaining resources or non-firm supplies from neighboring areas during periods of above-normal peak demand or low-resource conditions. Summer heat waves that extend over the entire area can limit the availability of excess supplies and increase the risk of energy emergencies in New England,” NERC noted in its summer reliability assessment.

ISO-NE has stated that system operators have numerous tools to balance load, including increasing production of online generation or dispatching stand-by units and energy conservation such as voluntary reductions of energy use.

The grid operator anticipates having 3,891 MW of demand resources for its 2024/2025 Capacity Commitment Period, according to the 2024 Summer Energy Market and Electric Reliability Assessment from the Federal Energy Regulatory Commission (FERC).

In worst-case circumstances, ISO-NE could be forced to call for controlled power outages to maintain system reliability and safeguard the infrastructure of the grid. “With the possibility of more extreme and less predictable weather conditions, there is an increased potential for system operators to activate emergency procedures,” ISO-NE stated in a press release.

ISO-NE and utilities in the region offer demand response programs in New England.

Midcontinent Independent System Operator (MISO)

MISO projects sufficient capacity under probable demand, but would rely on load-modifying resources (LMRs) made available through demand response programs and operating reserves to meet a high-demand scenario. Should a high-demand scenario materialize, MISO would be at an elevated risk of operating reserve shortfalls, NERC noted.

According to MISO, its surplus of 4,624 MW remains adequate for normal conditions, even though surplus capacity has decreased 30% since last summer, due largely to generator retirement, increased planning reserve margin requirement (PRMR) and fewer external offers. Regarding transmission, the grid operator says it is well-positioned to handle unplanned events on the MISO system this summer.

Furthermore, MISO has stated that it would mitigate summer risks by leveraging lessons learned from previous heatwaves, such as how appropriately timed use of LMRs and an increased requirement for its 30-minute reserve product worked well. MISO also expects solar generation to play a more active role as its in-service capacity tops 6 GW over the summer.

Demand Response Programs Available

Should MISO need LMRs, it could turn to demand response programs available to commercial and industrial customers in parts of Illinois and Michigan. Michigan customers served by Consumers Energy, DTE Energy or select municipal and cooperative members in MISO Zone 7, which covers the Lower Peninsula of Michigan, can participate. In Illinois, demand response participation is open to customers served by Ameren Illinois or select municipal and cooperative members.

Illinois is also trying to create more value from distributed energy resources (DERs) by exploring how utilities can maximize their benefits through effective system planning and efficient operational control. Regulators are considering a two-pronged approach to compensation for components of DER value such as benefits to energy and capacity markets and ancillary services.

New York Independent System Operator (NYISO)

The New York Independent System Operator (NYISO) does not anticipate any operational issues in the state this summer. It projects having adequate capacity margins and has procedures in place to handle any issues that may occur. For example, the grid operator could use demand response to meet above-normal summer peak load, NERC noted.

Although NYISO expects to have 40,733 MW of power resources available to meet forecasted peak demand conditions of 33,301 MW, the grid operator has warned that reliability concerns remain. Demand peaked at 30,206 MW last summer.

“Reliability margins have declined by more than 1,000 megawatts in just the last two years. That’s a significant issue especially when we’re impacted by heatwaves,” Executive Vice President and Chief Operating Officer Emilie Nelson stated in a press release announcing NYISO’s outlook for summer electricity reliability. “As demand is forecasted to rise in the coming years, this trend will continue to pose a challenge to system reliability.”

The reliability margin for this summer is 752 MW under baseline conditions but would be deficient during extreme weather. For example, if the state experiences a heatwave with an average daily temperature of 95 degrees lasting 3 or more days, the capacity margin is forecasted to be -1,419 MW, NYISO noted.

The margin would worsen to -3,093 MW under an extreme heatwave with an average daily temperature of 98 degrees. Under those conditions, NYISO operators would dispatch up to 3,275 MW through emergency operating procedures to maintain reliability, the grid operator has stated.

Demand Response Programs for Large Energy Users

Demand response has been at the forefront of NYISO’s efforts to smooth the state’s transition to clean energy. For example, NYISO has paved the way for virtual power plants (VPPs) by implementing its DER & AggregationParticipation Model, which was the country’s first program to integrate aggregations of distributed energy resources (DERs) into wholesale markets.

The DER Participation Model enables DERs to provide energy, ancillary services and capacity in the NYISO markets. DERs of at least 10 kW aggregated into VPPs of at least 100 kW can simultaneously provide wholesale services to the grid operator and retail services to utilities and load servers.

DER aggregations can include resources such as demand response, solar arrays, batteries and electric vehicles. Curtailable load, or demand response, is the only type of DER that can be aggregated as a single resource and technology. Currently, many C&I customers earn substantial revenue and reduce energy costs by participating in demand response in New York,

PJM

With a forecasted installed reserve margin of 29%, including expected committed demand response, versus a target of 17.7%, PJM does not any anticipate any problems meeting demand this summer, NERC noted. However, the grid operator does expect reserve margins to be lower than last summer due to rising demand, generator retirements and slower-than-anticipated resource additions.

The loss of generation resources is outpacing the addition of replacement resources amid accelerating growth in consumers’ demand for electricity, PJM stated in its summer outlook announcement. Thus, the grid operator has fewer generation resources (182,500 MW) of installed capacity) to draw on this summer compared with 2023 (186,500 MW of installed capacity).

PJM also projects a higher peak demand for electricity this summer at approximately 151,000 MW compared with the 2023 summer peak load of 147,000 MW. The increased peak load forecast combined with reduced generating capacity reduces reserve margins for extreme weather scenarios.

Scenarios that include this higher level of demand, combined with low solar and wind output and/or high generator outages, would further reduce reserve margins, the grid operator has noted. In these “unlikely but possible set of circumstances,” it might have to implement additional procedures to manage emergencies, including dispatching demand response, calling for conservation, limiting electricity exports or even temporarily interrupting service, according to PJM.

PJM has several demand response programs that it could call upon for help.

 

With the summer’s heat already here, and more to come in the months ahead, grid operators are preparing to meet surging demand. And as summer electricity usage surges, grid operators will likely seek help from customers that make their DERs available as VPPs. Customers who help will be rewarded.

CPower makes DER monetization easier and more rewarding by using customer resources to strengthen the grid when and where reliable, dispatchable resources are needed most. Customers interested in earning grid services revenue and reducing energy costs by helping grid operators meet their summer electricity needs can contact CPower to learn more: cpowerenergy.com/contact/.

Large energy users view virtual power plant projects as ways to help the environment. We could accelerate a cleaner and greener future by harnessing that motivation.

The percentage of commercial and industrial (C&I) customers that use distributed energy resources (DERs) as virtual power plants (VPPs) with the environment in mind has gradually increased over the last few years, according to CPower’s annual Customer-Powered Grid^® Survey. Nearly one-third (31%) of organizations now connect their energy management strategy to corporate sustainability or carbon reduction goals, this year’s survey showed.

Achieving environmental goals is increasingly important both for companies and their executives. Six in 10 companies from the S&P Composite 1500 Index include environmental, social and governance (ESG) metrics in measuring CEO performance—nearly triple the 23% that did in 2019

Furthermore, the percentage of S&P 500 companies with a climate metric in their incentive plan has climbed to almost 45%, up from 14% three years ago, representatives from WTW, formerly known as Willis Towers Watson, stated in a recent webinar, according to ESG Dive.

Customers help the environment when they use DERs like small-scale solar arrays, batteries or curtailable load because grid operators avoid burning fossil fuels and emitting associated carbon to generate electricity. In using DERs as VPPs in this way, grid operators save money as customers earn revenue and help their communities by avoiding carbon emissions.

Curtailing load or switching to renewable generation is particularly beneficial for customers, grid operators and communities when demand on the grid peaks. Rather than turning on polluting peaker plants to supply more power to the grid, grid operators pay C&I customers to reduce their electric loads.

Reducing Carbon Emissions with Virtual Power Plants

C&I customers with carbon reduction goals tied to energy strategy are nearly 200% more likely to increase hours of participation in VPPs, according to CPower’s 2024 Customer-Powered Grid^® Survey, which drew approximately 500 responses from customers, DER owners and operators and partners.

In one year alone, CPower helped its customers reduce 375,000 metric tons of CO₂ by using their VPPs as DERs, across sectors such as retail, data centers, education, healthcare, government and manufacturing. CPower manages nearly 7 GW of flexible DER capacity nationwide, which is equivalent to not turning on 134 peaker plants when demand cannot meet supply.

In addition to embracing the environmental impact of reducing carbon, customers appreciate the financial benefits of VPPs. Eight of 10 survey respondents said they would likely increase their participation in VPPs if the right incentives were in place. When asked to clarify what type of incentives would motivate them, 70% indicated that receiving revenue or reducing energy costs would help.

Understanding the drivers of VPP participation, like the environmental and financial benefits, is vital to meeting the U.S. Department of Energy’s target to triple VPP deployment by 2030, which would improve grid reliability while reducing carbon emissions and saving an estimated $10 billion per year.

Knowing that customers value helping the environment through virtual power plant projects can help us reach the DOE’s goal. If we encourage more C&I energy users to embrace the environmental benefits of VPP, we can help them achieve their goals —while also bringing about the cleaner and greener future that we endeavor to create.

To learn more about how virtual power plant projects can help your organization achieve its corporate sustainability or carbon reduction goals, call us at 844-276-9371 or visit CPowerEnergy.com/contact.

 

At CPower, we take pride in our vision of shaping the Customer-Powered Grid®, fostering a flexible, clean, and reliable energy future. 

Whether by collaborating with our clients to reduce carbon footprints by 375,000 metric tons of CO2 emissions in a single year or promoting grid sustainability through existing resources, we are proud to know that the work we do is essential in making this vision a reality.  

While this is particularly true on Earth Day, our commitment to combating climate change is an ongoing endeavor, not a one-day event or the responsibility of a single individual. Sustainability demands continuous engagement, extending beyond individual efforts, industries or communities.  

This year presents a perfect opportunity for individual and collective action because Earth Day has again converged with National Volunteer Week. We have encouraged all our team members at CPower to seize this moment by participating in activities that celebrate and contribute to our shared planet.  

Examples of activities and actions we have invited team members to participate in include:  

• • CPower’s 2024 Spring Day of Caring (Tuesday, April 23) – We have partnered with two groups in the Baltimore area this year – Friends of Patterson Park and Moveable Feast. This is a collaborative effort of all our employee resource groups within CPower. 
  • EarthDay.org – Employees have been able to get involved through the Earth Day Action Toolkit. 
  • Keep America Beautiful – This nationwide campaign is aimed at acting every day to improve and beautify our communities through education, community support and connecting individuals to volunteering opportunities. 

CPower encourages its employees to support their community by taking part in volunteer efforts with community service groups, schools and other such organizations. Each employee gets 16 hours of paid volunteer time annually, which can be used for participating in company-sponsored events or for personal volunteer endeavors. This benefit includes time spent traveling to and from the volunteering location. 

Group meet-ups for employees located near each other are great ways to foster company culture and connection. We encourage employees to propose volunteer ideas, invite their co-workers to join them and share their efforts with the whole company via announcements from our HR team.  

Also, this year, given the recent event involving the Francis Scott Key Bridge in our hometown, we thought it would be apropos for CPower to donate to a local organization, Blue Water Baltimore. Blue Water Baltimore’s mission is to restore the quality of Baltimore’s rivers, streams, and Harbor to foster a healthy environment, a strong economy and thriving communities. 

We appreciate our team members’ continued dedication to sustainability at CPower, for our customers and our planet. Not just on Earth Day, but every day. 

Are you interested in joining the CPower team in creating a clean, flexible and dependable energy future? Visit our Careers page to learn about professional opportunities: Careers at CPower. 

Heather Merrifield | Analyst, Data Acquisition – Operations 

Heather Merrifield is a data acquisition analyst for CPower’s Operations team and a member of the company’s Sustainability Employee Resource Group. 

Credit: NASA’s Scientific Visualization Studio
A total solar eclipse will move across North America at more than 1,500 miles per hour on April 8. The moon will totally block the sun along the path in red.

Commercial and industrial energy users can look at the bright side of the upcoming total solar eclipse. They may generate additional revenue by making their distributed energy resources available to keep the lights on in their communities as virtual power plants.

Although grid operators’ extensive preparations should ensure that the grid has enough electricity to avoid capacity shortages during the eclipse on April 8, they may need to quickly bring on new sources of generation, like customer DERs as VPPs, when solar power dims.

Grid operators’ need to carry additional capacity could create opportunities for C&I energy users that make their DERs available through economic markets, reserves programs or other grid services via VPPs. Prices for grid services have the potential to spike, particularly if the weather is clear and solar generation is at or near its potential peak before the eclipse. The sharper the drop in supply that grid operators must cover, the greater the revenue opportunities may be for customers or the need for short term demand response events.

Grid operators as far west as California have been bracing for system challenges, even though the eclipse’s impact will be most acute along the 124-mile-wide path of totality that will slice a swath from Texas to Maine.

Intermittency Poses Challenge

The possible impact is much larger than the last time the moon totally obscured the sun, in August 2017. The amount of electricity generated from solar energy has tripled since 2017 with no signs of slowing. In fact, its share of total U.S. electricity generation could almost double over the next two years, rising to 7% in 2025 from 4% in 2023, according to U.S. Energy Information Administration projections.

Although solar generation is an increasingly popular clean energy source, its intermittency demands more grid flexibility, like for managing the California duck curve. State electricity charts typically show a midday decrease in demand when solar supply is highest followed by a spike in demand in the evening when solar supply plunges. Thus, a chart resembles a duck.

Grid flexibility will be especially vital during the upcoming total solar eclipse, which could cause up to six minutes of complete midday darkness in some parts of the country. In a worst-case scenario, solar power would completely cease for those six minutes after generating most of the grid’s electricity on a sunny day. On a chart, it would look like demand dropped from a cliff into a canyon.

Unless demand also drops to zero in that time, grid operators would need to quickly supply electricity from other sources to maintain balance. They would then have to decrease the supply from the new sources just as fast as the eclipse passes, and solar generation ramps up to its previous level. That is, solar generation or its equivalent would need to spring straight up out of the canyon. Hence, the need for flexible generation sources, like C&I customers’ DERs.

Grid Operators Look to Flexible Resources

Customer DERs like backup generators, battery storage or load curtailment are ideally suited to provide grid operators with the quick-ramping resources they want.

CAISO

California may be far from the path of totality, but the California Independent System Operator (CAISO) anticipates the eclipse impacting at least some of its 18,500 MW of installed grid-scale solar capacity and 15,770 MW of rooftop solar capacity, nonetheless.

Grid-scale solar generation will decrease by 6,349 MW from the start of the eclipse to maximum impact and increase by 6,718 MW after, according to a CAISO solar eclipse technical bulletin. The net load ramp rate will increase by an average of +115 MW per minute and then decrease by -150 MW per minute.

With a steep climb back to pre-eclipse levels, grid-scale solar resources will use special procedures to limit the solar generation ramp rate during the eclipse return. CAISO will also use battery and hydropower resources to help meet the system’s faster-ramping needs during the eclipse. It will also procure additional operating reserves to help with the expected change in solar generation.

ERCOT

Northwest Texas will be one of the first regions of the U.S. to experience a total eclipse on April 8 as it lies at the beginning of the path of totality. The Electric Reliability Council of Texas (ERCOT) estimates that the state’s solar generation will be impacted from 12:10 p.m. to 5:10 p.m. CDT.

The sun’s coverage of the moon will range from 81% to 99% with the brunt of the eclipse being felt around 1:40 p.m., when solar generation will drop to about 7.6% of its maximum clear sky output, according to an ERCOT resource forecasting and analysis.

ERCOT does not expect any grid reliability concerns during the eclipse because it has been proactively working on forecasting models to reflect reduced solar power production and preparing the grid accordingly. The grid operator says that it will be ready to meet both the down and up solar ramps and to use ancillary services for additional balancing needs.

ISO-NE

ISO New England (ISO-NE) is collaborating with local utilities and neighboring grid operators to evaluate the expected conditions and potential impacts of the eclipse. All parts of New England will see at least 80% of the sun blocked by the moon during the peak of the eclipse, according to NASA.

ISO-NE says the eclipse could reduce solar energy production by thousands of megawatts. Most of the region’s solar power comes from small-scale, distributed systems connected directly to retail customers or local utilities and not the regional power system operated by the ISO, the grid operator notes.

“Though not anticipated, ISO system operators have a number of tools available to handle any supply deficits caused by extremely high demand or a sudden loss of other resources,” according to the ISO.

MISO

The Midcontinent Independent System Operator, Inc. (MISO) expects balancing and congestion management to be the biggest challenges, based on its experience with the last total solar eclipse in 2017 and a partial eclipse in 2023. MISO manages the flow of high-voltage electricity across 15 states, some of which lie in the path of totality for the upcoming eclipse.

For example, the following cities will experience total obscuration for the estimated durations, MISO notes.

• • Indianapolis, Ind. – 3 minutes, 46 seconds
  • Poplar Bluff, Ark. – 4 minutes, 8 seconds
  • Little Rock, Ark. – 2 minutes, 33 seconds
  • Mt Vernon, Ill. – 3 minutes, 40 seconds

MISO’s eclipse preparations include increasing regulation and short-term reserves and proactively communicating with its markets.

NYISO

The New York Independent System Operator (NYISO) forecasts a possible reduction of 3,000 MW or more in non-metered, or behind-the-meter (BTM)m generation solar generation at the peak of the eclipse, as well as a temporary loss of up to 110 MW in grid-connected, or front-of-the-meter (FTM), solar generation.

The eclipse is expected to be at its fullest from 3:16 p.m. to 3:29 p.m. EDT with 100% obscuration in Buffalo and Rochester for about 4 minutes apiece. Obscuration is to reach 96% in Albany. Across the state, the partial eclipse is to last about 2 hours and 30 minutes.

Actions to mitigate eclipse impacts could include manual operator intervention and supplemental commitment of fast-responding resources, according to NYISO. The grid operator is also running day ahead market simulations and refining BTM and FTM solar forecasts.

PJM

PJM’s eclipse plans include dispatching generation as needed to mitigate solar power losses, including reserve and regulation resources as required. Reserve resources can provide needed backup generation when called upon, while regulation resources can provide energy to help control voltage and frequency on the system, the grid operator notes.

Spanning all or parts of 13 states and the District of Columbia, PJM is preparing for the potential temporary loss of BTM and FTM solar resources during the eclipse. The actual amount of solar generation lost will depend on April 8’s weather. More solar power would be generated, and thus lost, on a sunny day than on a cloudy one, for example.

Even under cloudy skies, PJM is preparing to temporarily lose at least 80–85% of the production from its 8,200 MW of FTM, solar resources, as well as up to 4,800 MW of BTM generation.

VPPs Give Grid Flexibility

The eclipse could highlight how VPPs can help keep the grid balanced during extreme events. Aggregating customer DERs and dispatching them together offer fast, reliable and affordable ways to balance the grid. They also enable energy users with DERs enrolled as VPPs, such as C&I customers, to help the grid by flexing their loads as needed.

In the case of the eclipse, grid operators could cover temporary losses in solar power by tapping VPPs with customer DERs like load curtailment or distributed generation, instead of turning to fossil-fuel peaker plants that could cost more to use and emit more carbon dioxide.

The eclipse also emphasizes the importance of a well-rounded suite of energy assets that can help a C&I customer navigate a range of scenarios, rather than relying on a single type of resource like solar. For example, solar generation can be limited if snow prevents the sun from powering photovoltaic panels or if clouds obscure the sun. However, pairing solar power with battery storage could help a customer weather intermittency.

C&I customers should not limit themselves to using DERs for backup power either. VPP operators such as CPower can maximize the value of customer DERs by monetizing their abilities and optimizing their usage.

As the country’s leading DER Monetization and VPP provider, with 6.7 GW of DER capacity at more than 27,000 sites across the U.S., CPower helps customers earn grid services revenue and reduce energy costs by using their DERs to strengthen the grid when and where reliable, dispatchable resources are needed most.

In the days leading up to the total solar eclipse, CPower will help customers prepare their operations for resiliency while positioning them to earn money from grid services.

Call us at 844-276-9371 or visit CPowerEnergy.com/contact to explore how you can monetize your DERs and earn revenue for helping the grid.

Note: CPower would like everyone preparing for the eclipse to be safe, ensure you have proper solar eclipse sunglasses and to enjoy the show.

Visit the American Astronomical Society’s website for more safety information: How to View a Solar Eclipse Safely | Solar Eclipse Across America (aas.org).

Artificial intelligence is accelerating data center growth and energy needs—and facilities can reduce costs and earn revenue by managing their electricity wisely.

Grid planners have nearly doubled their 5-year load growth forecasts on the back of surging data-center demand. In fact, data centers may account for as much as one-third of the anticipated increase in U.S. electricity demand from 2024 through 2026.

With generative AI driving much of the demand growth and more uses of the technology expected, grid operators will reward data centers for investing in energy efficiency and keeping the grid balanced. Data centers that manage their energy efficiently could benefit as a result.

Data Centers Drive Demand

With data center growth forecast to exceed $150 billion through 2028, grid planners now expect total electricity demand to increase by 4.7% nationwide over the next five years—almost twice as much as the 2.6% lift they previously projected, Grid Strategies found in analyzing utilities’ latest Form 714 filings with the Federal Energy Regulatory Commission (FERC). Data centers typically use 40% of their electricity for computing, another 40% for cooling and 20% for other IT equipment.

Generative AI fuels the data center boom and the associated increase in electricity demand. According to Boston Consulting Group (BCG):

• • In 2022, data centers consumed 2.5% of the total electricity used in the United States (~130 TWh).
  • Data centers’ portion will triple to 7.5% (~390 TWh) by 2030.
  • That’s as much electricity as 40 million U.S. houses would use—or almost a third of the nation’s total homes.

GenAI is expected to account for at least 1% of this increased power usage, mainly because of the electricity-intensive training needed for large GenAI models and the greater electricity needed to service the increasing volume of GenAI queries, BCG noted.

The International Energy Agency (IEA) projects that data centers’ total electricity consumption could almost double from 460 terawatt-hours (TWh) worldwide in 2022 to 1,000 TWh in 2026. That would approximate the electricity consumption of Japan, and developing a large country’s worth of generation, transmission and distribution capacity would be impractical.

Grid Operators Pressed to Keep Pace

Data center growth has brought challenges for grid operators. For example, grid operator PJM has warned that “unprecedented data center load growth” in certain areas of its service footprint could cause “all remnant capacity on the transmission system” to be used.

Northern Virginia is the epicenter for PJM’s regional challenges as well as data-center issues more broadly. Building on federal investments in fiber optics and industry incentives, Virginia has become the world’s largest data center market, with more than 35% (~150) of all known hyperscale data centers (more than 40MW of capacity) worldwide, according to the Virginia Economic Development Partnership.

Virginia’s data center market is growing so rapidly that the northern part of the state needs several large nuclear power plants worth of capacity to serve all the data centers in development. With growth intensifying and challenges mounting, data centers in Virginia, PJM and elsewhere must be flexible to meet emerging capacity constraints.

Challenges Create Opportunities

Improving energy efficiency and maximizing the value of distributed energy resources (DERs) is increasingly important to data centers and the grid operators in the markets they serve. For example, although hyperscale data centers, which are hosted by cloud services providers like Amazon, Google and Microsoft, keep using more electricity, they often offset demand increases by investing in energy-efficient equipment and improving supporting systems such as HVAC and lighting.

With large power usage, comes large potential savings through energy efficiency. Furthermore, data centers in PJM and the Midcontinent Independent System Operator, Inc. (MISO) market region may also qualify for energy efficiency incentives that reward facilities for permanently reducing demand. These incentives are available to facilities in data-center hubs such as Virginia, Chicago and Ohio.

In addition to reducing energy costs by improving efficiency, qualified data centers can earn revenue without interrupting operations. There is no risk or extra cost for qualifying for energy efficiency incentives either.

For example, CPower’s process of qualifying data centers for energy efficiency incentives is simple.

1. Identify opportunity. Qualifying projects may include new construction, upgrades to energy-efficient servers or power usage effectiveness (PUE) improvements. (PUE compares the site’s overall load to its IT load. The ideal PUE number is 1.0 because it means that all electricity is consumed by IT equipment.)
2. Confirm qualifications. Key criteria include having a project completion date since Jan. 1, 2022, available capacity rights and a location within supported PJM or MISO territories.
3. Collect data. The last step before contracting includes gathering more than two years of data, including energy usage and PUE information, and completing an engineering review.

Given that energy efficiency opportunities evolve as the industry changes and power needs shift, working with a partner like CPower can help a data center capitalize on chances to save money and reap incentives as they emerge.

VPPs Maximize DER Value

Leveraging the flexibility of DERs like emergency generators, batteries and solar generation is also critical for data centers. The grid’s growing need for flexibility makes DERs increasingly valuable for grid services, thereby allowing data centers to make the most of their resources and maximize their value.

With excess generator capacity meant to keep facilities up and always running, data centers are optimally positioned to earn revenue by quickly curtailing loads in demand response programs. When properly automated, data centers can provide near real-time ancillary services that help keep the grid balanced as well.

Data centers also provide grid flexibility and drive the renewable energy transition by deploying grid-scale, carbon-free energy. Furthermore, as data centers look towards future growth, efficiency and sustainability, they can join virtual power plants (VPPs) to service their local communities and support the grid by optimizing DERs.

As AI accelerates data-center growth and electricity demand, data centers can reduce costs, earn revenue and help the grid by improving energy efficiency and maximizing the value of DERS.

Call us at 844-276-9371 or visit CPowerEnergy.com/contact to explore how you can monetize your data center’s energy efficiency and resources to earn revenue for helping the grid.

 

Nate Soles
As CPower’s Vice President of National Accounts, Nate manages dozens of data center clients and strategies across North America.

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.