General Motors (GM) Ford (F) and Google (GOOG) partner with clean energy companies to promote virtual power plants

General Motors (NYSE: GM), Ford (NYSE: F) and Google (NASDAQ: GOOG), alongside solar and energy storage companies SunPower (NASDAQ: SPWR) and Sunrun (NASDAQ: RUN), announced on Tuesday that they would all be working together to establish standards for scaling up the use of virtual power plants (VPPs).

A virtual power plant allows for the cloud-based distribution of pooled decentralized power-generating energy resources, such as electric vehicles or electric heaters, that can be reallocated or sold back to the city for easing loads on electricity grids when supply is short.

With permission from customers, they will use advanced software to react to electricity shortages with such techniques as switching thousands of households' batteries, like those in EVs, from charge to discharge mode or prompting electricity-using devices, such as water heaters, to back off their consumption.

Energy transition nonprofit RMI will host the initiative, the Virtual Power Plant Partnership (VP3), which will also aim to shape policy for promoting the use of the systems, the companies said.

"Virtual power plants will enable grid planners and grid operators to (better manage) growing electricity demand from vehicles, from buildings and from industry, and make sure that the grid can stay reliable even in the face of ongoing extreme weather challenges and aging physical infrastructure," said Mark Dyson, managing director with the carbon-free electricity program at RMI.

Rob Threlkeld, director of global energy strategy at General Motors, told Reuters that VP3 would be able to "show that EVs can become a reliable asset to the retail utility and or the retail transmission operator" and "can be an asset to a homeowner and to fleet customers."

During an extreme heat wave last August, California Independent System Operator avoided blackouts by calling on all available resources, including VPPs, to dispatch electricity.

"That is increasingly going to be required to make sure that the grid remains resilient, that we avoid blackouts and that we enable the grid to become cleaner and greener," said Parag Chokshi, director of Google's Nest Renew.

Shares of GM, F and GOOG are up 3.02%, 1.14% and 0.09% respectively near end of day trading.

SPWR and RUN are up 3.83% and 2.66% respectively.

By Michael Elkins | [email protected]

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