PG&E Corp. and Sunrun Inc. have formed a partnership to pay homeowners with solar and battery systems to provide power to the California grid and help prevent blackouts when demand spikes in hot weather.
Under the agreement, Sunrun will enroll up to 7,500 new and existing home solar and battery customers in PG&E’s service area to create a so-called virtual power plant. The systems would be able to provide enough electricity to power 22,000 homes during summer evenings when energy supplies can run short. The idea is to tap into renewable energy produced by rooftop panels that can be stored in home batteries and used after the sun has set, displacing some fossil-fuel produced power.
The program is part of an effort by California to shore up its wobbly power grid that’s become vulnerable to blackouts on hot evenings when its solar production fades and air conditioning use remains high.
A brutal heat wave last summer that brought the state near the brink of blackouts prompted California Governor Gavin Newsom to declare a grid emergency that urged utilities to find ways to reduce the strain on the grid resulting from the retirement of older natural-gas plants. As part of this effort, PG&E also has been paying Tesla home battery owners for their energy when state grid operators declare conservation alerts.
“This is a time that requires transformation of our energy system and a real adaptation of it given climate change,” said PG&E Chief Executive Officer Patti Poppe. The California utility giant’s collaboration with Sunrun is an example of how the utility can leverage the growing number of residential solar and storage systems in its territory to help provide reliable, clean power when it is needed most, she said.
The partnership between PG&E and Sunrun is notable as it comes after the two companies clashed last year over reforms to a state program that led to the cutting of utility payments to rooftop solar customers for their excess green energy. Under the agreement announced Monday, Sunrun home solar and battery customers who participate will get an upfront $750 payment that will be reimbursed by PG&E and a free smart thermostat.
Sunrun Chief Executive Officer Mary Powell said the partnership with PG&E is an example of the type of “radical collaboration” that will be needed to transform the aging grid to an updated power network that uses more distributed, clean energy technologies. “It’s not just about the power of what this does, it’s also the power of the example it provides for the rest of the country and the world,” Powell said.
Enrolled systems will be directed to discharge every day from 7 p.m. to 9 p.m. from August through October. Home batteries will be allowed during that time to have enough energy to meet essential power needs if there is a local outage, the companies said.
To contact the author of this story:
Mark Chediak in San Francisco at firstname.lastname@example.org
© 2023 Bloomberg L.P.