Tesla teams up with Sunrun to create first virtual power plant in Texas

American clean technology giants Sunrun and Tesla announced this week that they will partner to create a virtual power plant with over 150 Sunrun customers in Texas.

Together, the two companies will create what they describe as the “first operational aggregated power plant program” – also known as a virtual power plant (VPP) – in Texas.

The partnership has reportedly already signed on more than 150 Sunrun customers, each of whom will participate in the Aggregated Distributed Energy Resources pilot program being undertaken by the Electric Reliability Council of Texas’s (ERCOT), the state’s grid operator.

The program is aimed at strengthening the reliability of the power grid by connecting residential battery storage devices to be used as a single resource for the wholesale electricity market.

By networking together Tesla Powerwall batteries as a VPP, ERCOT will be able to lower the costs of energy at the wholesale level, with the resulting energy cost savings to be shared with participating customers who could expect to receive yearly payments of around $US400 per Powerwall.

Customers who do participate in the VPP will retain a portion of the energy stored in their batteries to provide back-up power to their home in the event of a power outage.

The new partnership between Sunrun and Tesla follows only weeks after Hurricane Beryl caused widespread power outages impacting nearly 3 million homes and businesses.

Texas was also devastated by the deadly power grid meltdown during the winter storm in February 2021, since which ERCOT has sought ways to diversify and strengthen the power grid.

“Texas grid has already experienced a traumatic spring and summer due to weather vulnerabilities and we know the state also needs more power to meet soaring demand on a daily basis,” said Mary Powell, Sunrun CEO.

“We’re eager to bring Sunrun’s on-demand battery response expertise to help make the grid more resilient against outages.

“Texas families are increasingly opting to add batteries to their solar installations. On-site energy storage not only provides homeowners peace of mind with outage protection but also enables them to participate in programs like these by contributing to solutions that better the lives of those in their communities.”