Can you please explain virtual power plant?

[hemiarch]

I live in Arizona and use APS as a power company. I have two powerwalls and a moderate amount of solar compared to my use but with time based control my bill is quite small.
Yesterday an option called virtual power plant appeared in my app.
I think I understand what it’s offering me, but it also warns it could have a significant effect on my bill.
Can anyone please explain. What this is and why I would want it or not want it?
Isn’t this basically what my powerwalls already do based on time controls? There are defined peak and off peak time here and right now my powerwalls mostly discharge during peak times.
How does whether or not I want to do this change once software enables me to use the CT as a backup? It’s the equivalent of about 10 powerwalls so should impact the decision no?
If I do this and it ends up using more of my stored energy from the truck, is there a significant impact on wear and tear of my truck battery?
In added a poll to get a feel for what you guys think of this. Feel free to answer if you have an educated opinion on the matter or formulate one based on the discussion. Of course, feel free to skip the poll if you honestly have no idea.

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[mongo]

I live in Arizona and use APS as a power company. I have two powerwalls and a moderate amount of solar compared to my use but with time based control my bill is quite small.
Yesterday an option called virtual power plant appeared in my app.
I think I understand what it’s offering me, but it also warns it could have a significant effect on my bill.
Can anyone please explain. What this is and why I would want it or not want it?
Isn’t this basically what my powerwalls already do based on time controls? There are defined peak and off peak time here and right now my powerwalls mostly discharge during peak times.
How does whether or not I want to do this change once software enables me to use the CT as a backup? It’s the equivalent of about 10 powerwalls so should impact the decision no?
If I do this and it ends up using more of my stored energy from the truck, is there a significant impact on wear and tear of my truck battery?
In added a poll to get a feel for what you guys think of this. Feel free to answer if you have an educated opinion on the matter or formulate one based on the discussion. Of course, feel free to skip the poll if you honestly have no idea.

First question: are you on a demand based plan? (Is your electric price based on your highest power draw?)

Virtual power plant leverages a bunch of distributed batteries to act as a generation plant during times of high grid demand. Think high PW output for a few hours to cover everyone's air conditioning.
This is different than only exporting your excess solar and is akin to your time based charge/ discharge arbitrage, but moreso.

Cybertruck would not be involved because Powershare is only used in grid failure situations. However, if your PW were drained by the VPP event, followed by a grid outage, CT would help support your house.

 

[hemiarch]

Yes. My demand rate is determined by the maximum draw during peak hours as I understand it even for the briefest period on a monthly basis. So I’d have no demand charges at all if I used nothing from 3-7pm every Monday to Friday which is why I have never fully understood why the system doesn't essentially run off-grid during those hours if it’s trying to minimize cost.
Sometimes when I look at the app during those peak hours it’s drawing mostly from the powerwall and solar but a little from the grid even though the demand is way below my inverters ability to support.
I easily have enough in the powerwalls to run those hours even if solar were zero during those times (which it’s not).
But yes, as you say, the CT would act as my backup if this depleted my powerwalls which means I can set the powerwalls to maximize time based use without worrying about what I’d do in the event of a power failure. Down to 10% or something like that.

 

[hemiarch]

First question: are you on a demand based plan? (Is your electric price based on your highest power draw?)

Virtual power plant leverages a bunch of distributed batteries to act as a generation plant during times of high grid demand. Think high PW output for a few hours to cover everyone's air conditioning.
This is different than only exporting your excess solar and is akin to your time based charge/ discharge arbitrage, but moreso.

Cybertruck would not be involved because Powershare is only used in grid failure situations. However, if your PW were drained by the VPP event, followed by a grid outage, CT would help support your house.

So would I get more for power exported during those times than the 8c/kwh I get now?

 

[mongo]

So would I get more for power exported during those times than the 8c/kwh I get now?

Yeah, the posted image says $110 per average hourly kW over the events... but I don't understand that number.
I think you also get your typical export payment.

 

[mongo]

This Arizona page (Tucson centric) recommends contacting the power company if you are on a demand rate plan
https://www.tesla.com/support/energy/virtual-power-plant/tucsonelectric

 

[hemiarch]

Maybe they determine what my excess “production” is and then allow themselves to draw up to that amount from my system during peak hours. So if they are allowed
to draw up to 3kw I get $330 per year towards my bill?
But that can be 3kw for five minutes or for the entire 4 hours of peak time.

 

[mongo]

Maybe they determine what my excess “production” is and then allow themselves to draw up to that amount from my system during peak hours. So if they are allowed
to draw up to 3kw I get $330 per year towards my bill?

I think if you average 3kW outout over all the events (up to 60, each up to 4 hours) you get $330.
So if 100 hours, that's 300kW of export.

Draw during an event can be max PW output until it hits your discharge threshold. At that point, you have less to offset your own import which can impact demand charges. Higher VPP reserve means more left for you, but less participation in the event and lower payout.

 

[hemiarch]

I think if you average 3kW outout over all the events (up to 60, each up to 4 hours) you get $330.
So if 100 hours, that's 300kW of export.

Draw during an event can be max PW output until it hits your discharge threshold. At that point, you have less to offset your own import which can impact demand charges. Higher VPP reserve means more left for you, but less participation in the event and lower payout.

Yeah. That how I understand it I think too. Not sure how to figure out if it’s in my financial best interest or not other than trying it.

 

[mongo]

Yeah. That how I understand it I think too. Not sure how to figure out if it’s in my financial best interest or not other than trying it.

There's also the question of what rate plate works best (assuming you have options).

 

[DJAlan2000]

Basically, the way it works is that if you have solar AND battery you can sign up... When you do, you are allowing the Utility company (via Tesla's VPP) to 'control' the energy during an 'event'. They have access to your solar AND battery stored energy.

When an event is scheduled, you get notified (usually the day before) so that you can decide if you want to 'help out' or not... In other words, you have a chance to 'opt out' of that event if you wish... Then, what happens, usually during 'peak' hours of say 6-8pm (usually it's for 2-3 hours at most sometime during your area's PEAK period - mine is 4-9pm) the UTILITY company will start sucking up as much solar as they can as well as some of your battery... Usually at a max of 13kWh...

This will go on until your either the time runs out OR, more likely, your battery is used up to whatever level you set it at (I set mine for 4% left over for 'backup' as we're not in a area where I have to worry so much about long term outages). So, with MY system, it drains both my PW3's down to 4%...

You get PAID on an 'annual' basis (or at least that's what it says for me) and that's usually well after the last 'month' of the VPP timeframe... Your system says you can get a max of $400 per PW... Mine (SCE/Tesla) says I can earn up to a max of $350 per PW, so I can get up to $700 'extra' per year by joining...


VPP's are why California hasn't had to do very many 'rolling blackouts' over the past 2-3 years!! They are able to get 'extra' power from the VPPs AND because those who joined the VPPs are not USING GRID POWER during the peak times... So, less usage overall on the grid AND MORE power being put onto it... Win, Win...

 

[hemiarch]

So. Do you guys recommend doing this?

 

[mongo]

So. Do you guys recommend doing this?

Not without the rate impact information...

 

[DJAlan2000]

So. Do you guys recommend doing this?

I would do it! It definately will pay better being part of the VPP than just selling the power by yourself... The utilities will pay MUCH MORE during those events to VPP members than the standard rate (if you are on NEM 1.0 or 2.0 - if 3.0 then it's REALLY higher than your 'sell' rate).

There are other VPPs you could join, but not as easily or simply as the Tesla one... Some might even pay a few dollars more, but you would need to setup a separate app and then, with some, YOU need to 'monitor' the 'requests' from the utilities and then 'sign up' for each event... Just not worth it if you asked me... IF you have Tesla Solar/batteries that is...

I also use NETZERO's app to do a lot more with the system... It integrates easily and has the ability to not only monitor your system, but also do 'automations' as well...

Like these that I setup for my system:

Every day at 6:00 AM: Set backup reserve to: 25%; Set operational mode to: Time-Based Control; Set energy exports to: Everything (solar and battery); Set grid charging to: Enabled.

AND
Every day at 4:00 PM: Set backup reserve to: 5%; Set operational mode to: Time-Based Control; Set energy exports to: Everything (solar and battery); Stop vehicle charging

This is just 'fine tuning' my system... I have others as well that tell it to start charging at 2am, etc...

It used to be free... But they just went 'pay'... But it's worth it...Just fine tuning like this (so that it 'sells' power when it's PEAK time (for more money) and doesn't from 9pm to 6am, then my batteries aren't drained in the morning...

I do this especially because we have TWO EVs (CT and MY) and the model Y charges at late night, but the CT can (when the Powerwalls are FULL) do 'charge on solar'... Charge on solar runs at about half the speed, but it doesn't pull ANYTHING from the grid OR batteries then... BUT the PW's need to be FULL FIRST... Oh, and I generally have my Charge On solar set to 'charge vehicle on any source' up to 50% and then from 50-90 ONLY using solar...

 

[koolio]

I’m in MA and our electricity rates are a flat price 24x7. So I was looking forward to VPP. I’ve had my system for 2 years (this summer is the second summer with it). My payout for VPP last year was higher than the estimate in the Tesla app. For 1 Powerwall 3, I got $797, and I got PTO on July 5, 2024 so not a full summer of VPP. I was happy with the payout.

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