Tesla Enters the Virtual Power Plant Game…In Australia…

Tesla Virtual Power Plant

Tesla doesn’t stay out of the news, and nowadays we typically want to avoid the daily digest of Musk’s tweets unless it gives us a way to introduce some progress in a space that is beneficial to the de-carbonization & resilience efforts associated with the Electric Grid. And some results about their pilot in Australia with an integrated Virtual Power Plant solution for their power-walls.

Virtual Power Plants are not a new concept. All it really is – is a way for utility companies and their grid operators to curtail loads when necessary so the grid doesn’t collapse. They do this by tapping into your smart home devices [Google Nest’s, EV Chargers, etc] and turning them off during a demand response period.

Now if we want to consider the leaders in the Virtual Power Plant space we have to consider AutoGrid & OhmConnect. Both companies offer something similar – Autogrid more on the enterprise side and OhmConnect on the residential front.

But there is one key difference between what Tesla and AutoGrid & OhmConnect offer in the Virtual Power Plant space

Tesla is leveraging their PowerWalls [Residential Battery] to reduce demand charges and AutoGrid + Co. don’t require a $15,000 battery pack.

Now for all you seasoned veterans out there – this is absolutely nothing new, but, it is getting a lot of attention and it requires demystifying and digging into. Batteries today – through their inverters – can load shift devices within the home to use less grid power…fundamentally the logic within the inverter is “charge when power is cheap, use battery power when power is expensive”

But Virtual Power Plants are designed for Utility companies, not the homeowner…which is why what Tesla is doing is interesting.

For grid resilience, load reduction and energy management from a utility perspective having access & automated control over hundreds and eventually thousands of small battery packs enables them to handle revolving loads much easier than an AutoGrid – pure software like solution. A fully integrated battery + VPP energy management system is amazing.

However, my hunch is it still won’t be any match for AutoGrid or OhmConnect – being equipment agnostic, but, remain compatible or having the ability to integrate with battery manufacturers out of the box is far more scalable for utilities in this rapid push towards grid modernization.

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