Search Climate Insights Directory
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Supporting a Reliable Grid: The Opportunity for Virtual Power Plants in Michigan
Michigan faces grid reliability issues, including frequent blackouts and narrowing capacity for peak demand. Virtual power plants (VPPs), which aggregate distributed energy resources (DERs), are proposed as a solution to support the state's clean energy goals of 80% by 2035 and 100% by 2040. The document recommends that utilities seek funding from the Department of Environment, Great Lakes, and Energy (EGLE) and the Michigan Public Service Commission (MPSC), utilize the MPSC's 90-day pilot review program, and that the legislature mandate VPP implementation. Additionally, it suggests the MPSC allow residential and small commercial aggregation in wholesale markets and update metering infrastructure procurement to ensure DER integration capabilities.
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Document type: Policy brief
Avoiding the Stranded Asset Mistakes of the Past: A Case Study in Wisconsin
The document analyzes the financial burden on Wisconsin Electric Power Company (WEPCO) ratepayers resulting from the early retirement of the coal-fired Oak Creek Power Plant and warns against repeating these mistakes by investing in new natural gas plants. It argues that clean energy alternatives and better regulatory scrutiny of load forecasts can prevent future stranded assets.
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Document type: Case study
During a Historic Hurricane Season, Microgrids Kept Communities Running
RMI outlines five key factors—facility suitability, electricity costs/net metering, energy efficiency, battery sizing, and available funding—to help US communities deploy solar-plus-battery microgrids that serve as resilience hubs during disasters.
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Document type: Guide
Local Governments Can Achieve Texas-Sized Impacts from Distributed Energy Assets and Virtual Power Plants
The document outlines how Texas municipalities and counties can catalyze the adoption of distributed energy resources (DERs) and virtual power plants (VPPs) to address rising electricity demand and grid instability. It details the types of DERs—generation, storage, and demand-side—and explains how VPPs (referred to in Texas as aggregate distributed energy resources or ADERs) coordinate these assets for grid-level benefits. The briefing identifies drivers for adoption, including the Inflation Reduction Act and extreme weather events like Winter Storm Uri and Hurricane Beryl, and provides a framework for local governments to increase adoption through public education, zoning updates, streamlined permitting, and the enrollment of government-owned assets into VPPs.
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Document type: Briefing
Get a Load of This
The report addresses the surge in US electricity demand, noting that utility integrated resource plans covering 48% of sales expect load to grow 20% from 2023 to 2035. It argues that traditional forecasting is inadequate for new large loads—specifically data centers and industrial reshoring—which possess unique load shapes, high uncertainty, and 'flight risk'. The authors recommend that regulators shift toward scenario-based forecasting, increase the frequency of updates (e.g., quarterly), and implement 'least-regrets' capital investments and risk-shifting tariffs to protect ratepayers from the costs of forecast errors.
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Document type: Report
Électricité propre : payer les gens plutôt que les centrales
The author contends that households and businesses can act as a 'flexible power plant' by adjusting electricity use during peak demand, reducing the need for natural gas backup. The text highlights an Ontario program where smart thermostats created a 90 MW 'virtual power plant' and urges federal and provincial governments to incentivize energy efficiency and smart device integration to lower costs and carbon emissions.
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Document type: Statement
Pay people instead of power plants for clean electricity
The author contends that customer-driven demand-side management—such as smart thermostats, heat pumps, and optimized EV charging—can serve as a 'virtual power plant' to maintain grid stability. The text highlights a successful Ontario program that created a 90-megawatt virtual power plant and calls for federal and provincial policy shifts to prioritize energy efficiency investments over fossil fuel infrastructure.
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Document type: Statement
Industrial Decarbonization in East Asia
The report provides a comprehensive roadmap for industrial decarbonization in East Asia, focusing on China, Indonesia, and Viet Nam. It proposes a six-tier technical strategy ranging from energy efficiency to green hydrogen and clean feedstocks. The analysis highlights that while efficiency and 'easy electrification' are cost-effective, deeper decarbonization requires massive investments—USD 1.7 trillion cumulatively through 2050 for industry alone across the three nations—and a fully decarbonized power grid. It recommends a policy package centered on carbon pricing, renewable energy procurement, and workforce reskilling to overcome high upfront costs and technical barriers.
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Document type: Report
Réseaux intelligents
The document identifies smart grids as a 'safe bet' for Canada's energy transition, noting that while technologies like smart meters and virtual power plants are proven, their widespread adoption is hindered by regulatory barriers and consumer hesitation. It highlights existing provincial initiatives in Quebec, Ontario, and British Columbia as models for scaling digital grid infrastructure to manage increasing electricity demand and integrate variable renewable energy.
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Document type: Fact sheet
Smart Grids
The document identifies smart grids as 'safe bets' for Canada's energy transition, capable of increasing efficiency and reducing costs by managing peak demand through supply-side solutions like battery storage and demand-side tools like virtual power plants. While provinces such as British Columbia, Quebec, and Ontario have implemented various smart grid applications, widespread adoption is hindered by regulatory barriers, outdated utility incentives, and consumer hesitancy. The author argues that provincial policymakers and regulators must update legislation and incentives to accelerate the deployment of digital grid infrastructure to meet growing electricity demand.
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Document type: Fact sheet
Solar and grid flexibility critical for Malaysia's future electricity affordability and security
Malaysia possesses significant untapped solar resources that could reduce its reliance on volatile fossil fuel prices and improve energy security. While the National Energy Transition Roadmap (NETR) targets 70% renewable capacity by 2050, the report suggests that more ambitious targets, such as those proposed by IRENA, could further benefit the country. In Peninsular Malaysia, solar generation costs dropped 64% between 2016 and 2021, becoming 53% cheaper than fossil fuel options by 2023. To manage the 'twin peaks' of daily demand (4 pm and 8 pm), the report advocates for a combination of solar for daytime peaks and hydropower and battery energy storage systems (BESS) for evening peaks. Key barriers include the need for grid interconnections between Peninsular Malaysia, Sabah, and Sarawak, as well as the requirement for clearer policies on wheeling charges and BESS bankability.
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Document type: Report
CLEAN ENERGY ISN’T DRIVING POWER PRICE SPIKES
The report finds that U.S. residential electricity rates have generally kept pace with economy-wide inflation since 2010, and that states with high clean energy growth often see rates rise slower than inflation. Instead, the report identifies natural gas price volatility, wildfire mitigation and liability costs, aging coal plant investments, and rising transmission and distribution costs as the primary drivers of rate spikes. It further argues that the regulated utility business model incentivizes capital-heavy investments over more cost-effective operational solutions, which compounds these costs for consumers.
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Document type: Report
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.
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Document type: Briefing
Meeting Summer Peaks: The Need for Virtual Power Plants
The document advocates for the adoption of virtual power plants (VPPs) to address electricity grid reliability and affordability during summer peaks. It highlights that VPPs can leverage existing assets to manage investment costs and enhance community resilience against extreme weather, providing guidance for regulators to replicate successful VPP implementations from other jurisdictions.
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Document type: Policy brief
Virtual Power Plant Flipbook
The Virtual Power Plant Flipbook provides a resource for utilities to implement VPPs—aggregations of distributed energy resources like batteries and electric vehicles—to enhance grid reliability and decarbonization. It offers case studies on various technologies, compensation frameworks, and partnership models to serve as a starting point for program managers and grid operators.
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Document type: Guide
How Distributed Solar Can Reinvigorate India’s Electricity Distribution Companies
The briefing examines how distributed solar, particularly through schemes like PM Surya Ghar and PM-KUSUM, can mitigate the financial distress of Indian Discoms by reducing the cost of supplying subsidized consumers and lowering power procurement costs. It highlights the potential for distributed solar to contribute significantly to India's 2030 renewable energy purchase obligations (RPO) and suggests that the adoption of virtual power plants (VPPs) and battery storage could further modernize the grid and manage peak demand.
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Document type: Briefing
Big Wires, Small Wires, and Non-Wires Solutions to “Electrify Everything”
The briefing outlines a three-pronged strategy to modernize the US power grid to accommodate increasing electricity demand from data centers, manufacturing, and electric vehicles. It advocates for 'Big Wires' (high-voltage transmission and grid-enhancing technologies), 'Small Wires' (distribution upgrades for diffuse loads like EVs), and 'Non-Wires' solutions (virtual power plants) to ensure a reliable and affordable transition to a fully electrified economy.
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Document type: Briefing
Barriers and Solutions to Building Clean Energy in California
To meet its 2045 clean energy goals, California must roughly triple its energy capacity, but faces significant barriers in grid infrastructure, interconnection processes, and land use. The document proposes solutions such as grid-enhancing technologies, interconnection reforms with equity considerations, and incentivizing clean energy on built environments or disturbed lands.
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Document type: Fact sheet
VPP Policy Principles
The document outlines the role of virtual power plants (VPPs) in aggregating distributed energy resources (DERs) to provide utility-grade services and argues that strong policy and regulation are essential to scale these benefits over the next one to four years.
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Document type: Policy brief
VPP POLICY PRINCIPLES
The policy brief outlines 17 principles for the advancement of virtual power plants (VPPs), focusing on expanding the distributed energy resource (DER) asset base, optimizing VPP design, ensuring equitable compensation, improving customer experience, and defining the roles of utilities and system operators. It argues for technology-neutral policies, open communication standards, and fair market access to allow VPPs to compete with traditional grid solutions while maximizing benefits for all ratepayers.
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Document type: Policy brief