Meeting Summer Peaks: The Need for Virtual Power Plants

The document highlights the risk of insufficient electricity generation during summer heat waves in North America, driven by projected peak load growth of 38 GW through 2028. It proposes Virtual Power Plants (VPPs)—aggregations of distributed energy resources (DERs)—as a key tool to enhance grid reliability and community resilience. VPPs are presented as more affordable than gas peakers or batteries and can be deployed in 6-12 months. The briefing outlines three essential policy principles: expanding the DER asset base, ensuring fair compensation, and enabling value stacking. Case studies from the US and Canada demonstrate VPPs' ability to provide peak capacity, reduce infrastructure costs, and offer backup power during extreme weather.

• North American electricity grids face elevated risks of supply shortfalls during summer heat waves, a situation exacerbated by a projected increase in peak load of 38,000 MW over the next five years.
• Virtual power plants (VPPs) offer a cost-effective alternative to traditional infrastructure, with research indicating they can increase resource adequacy at a net utility system cost approximately 40% that of a gas peaker and 60% that of a battery, potentially saving $15 to $35 billion in capital investments nationwide.
• VPPs can be deployed significantly faster than traditional generation or transmission projects, with some programs launching in as little as six months, making them viable for managing peaks as early as 2025.
• To effectively leverage VPPs for summer reliability, the document identifies three critical policy priorities: expanding the adoption of distributed energy resources (DERs) to ensure a sufficient asset base, implementing fair compensation for services delivered, and allowing 'value stacking' to maximize grid benefits.
• VPPs enhance community resilience by providing critical backup power during major disruptions; examples include Green Mountain Power's use of residential batteries for severe weather and Holy Cross Energy's use of DERs for backup power in fire-prone areas.
• Over 500 VPPs are currently operating across North America, suggesting that utilities do not need to start from scratch but can instead adopt leading practices from existing jurisdictions.

APA

Brehm, K., Land, M., McEvoy, A., Shwisberg, L., & Weschler, A. (2024). Meeting Summer Peaks: The Need for Virtual Power Plants. RMI. https://rmi.org/wp-content/uploads/dlm_uploads/2024/06/VPP_reliability_brief.pdf

Chicago

Brehm, Kevin, Matthew Land, Avery McEvoy, Lauren Shwisberg, and Alan Weschler. Meeting Summer Peaks: The Need for Virtual Power Plants. RMI, 2024. https://rmi.org/wp-content/uploads/dlm_uploads/2024/06/VPP_reliability_brief.pdf.

Wikipedia

{{cite report |last1=Brehm |first1=Kevin |last2=Land |first2=Matthew |last3=McEvoy |first3=Avery |last4=Shwisberg |first4=Lauren |last5=Weschler |first5=Alan |title=Meeting Summer Peaks: The Need for Virtual Power Plants |publisher=RMI |date=July 2024 |url=https://rmi.org/wp-content/uploads/dlm_uploads/2024/06/VPP_reliability_brief.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{brehm2024meeting, author = {Brehm, Kevin and Land, Matthew and McEvoy, Avery and Shwisberg, Lauren and Weschler, Alan}, title = {{Meeting Summer Peaks: The Need for Virtual Power Plants}}, institution = {RMI}, year = {2024}, month = jul, url = {https://rmi.org/wp-content/uploads/dlm_uploads/2024/06/VPP_reliability_brief.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }