On July 29 from 7-9 p.m., California carried out a massive test of its grid. This grid test was unique in that it involved thousands of residential batteries in people’s own homes. These batteries worked together as a Virtual Power Plant (VPP), coordinated by software, to deliver 535 megawatts of electricity to the grid.

In this instance, customers from several California utility companies participated in the program. They had signed up for special programs that allow energy consumers to be paid for providing a portion of their home batteries to support the grid when needed.

The California test was a massive success. So why isn’t this happening in Florida?

Let’s start from the beginning to explain what a VPP is – and could be in our home state.

What Is a Virtual Power Plant (VPP)?

As explained on the Tesla website, “A virtual power plant (VPP) is a network of distributed energy sources such as homes with solar and battery systems, working together as a single power plant. The combined energy of these sources is used to support the electrical grid. Participating members can give the VPP program permission to use their energy as a resource during high demand events and generate value through their participation.”

While VPPs are made up of multiple types of assets, each unit within the network remains independent in its operation and ownership. The assets can be located anywhere on the grid. Aggregation software manages the VPP in a way that mimics a traditional power plant control room.

The Benefits of Virtual Power Plants

As we wrote back in 2022, in our blog post “Virtual power plants could be the ‘next big thing’ – and homeowners could benefit,” the benefits of VPPs are many: they can help maintain grid stability. They can support increased demand at times of intense need – such as during extreme heatwaves, like the country has seen recently. They help to provide higher efficiency and increased flexibility when there are significant load (consumer use) fluctuations. And for consumers who are part of such a network, there is a revenue opportunity, as they can sell power back to the grid at times of high demand.

Current Virtual Power Plant Programs in Florida

Duke Energy announced a VPP pilot program as a 12-month study in Florida in 2022 but it is not currently available to residents. The company does offer up to $624 per Powerwall, per year in the Carolinas to be a part of the Tesla VPP program, called “PowerPair.” But not in Florida!

The only utility in Florida offering any type of VPP program is Sumter Electric Cooperative (SECO) in Central Florida. Offered in collaboration with Tesla, the program offers consumers up to $275 per Powerwall, per year to support the grid. But SECO only represents around 250,000 energy consumers – a fraction of Florida’s population.

Why VPP Programs Are Limited in Florida

Given our state-sanctioned monopoly utility model, most utilities here are resistant to the VPP concept. But as Florida experiences more dangerous storms, and Florida’s population continues to grow at exponential rates, it’s going to be critical to explore new ways to “keep the lights on.”

Why Virtual Power Plants Are a Win-Win

VPP’s are a win-win for everyone. Homeowners benefit financially, helping to offset the cost of solar and battery for their home, which simultaneously increases their home’s storm resilience. Utilities benefit from having low-cost energy from an exceptionally reliable source because the VPP is distributed across the grid (so not at risk if a particular power line is downed during a storm).

The Future of Virtual Power Plants in Florida

As it has been with solar, VPPs will be critical to meeting our energy needs in the (not-so-distant) future – but if it’s going to happen, Florida’s leadership and the Florida Public Service Commission need to push the big utilities to offer VPP programs.