New Virtual Power Plant to Offer Ancillary Services

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PJM signed an agreement with Delmarva Power last week to explore how the new Elk Neck Battery Storage “virtual power plant” will participate in the region’s wholesale market for ancillary services beginning in 2022.

The project involves a residential community located on the Elk Neck Peninsula in the Chesapeake Bay in Cecil County, Maryland. Each of 110 homes involved will be equipped with battery storage that can both serve the energy of the individual homeowners or, aggregated and controlled together, provide reliability services to the local distribution system – as well as the RTO – by both charging and discharging from the grid.

Sunverge, a San Francisco-based provider of distributed energy resource (DER) control, orchestration and aggregation platforms, is collaborating with Delmarva on the project. The project will serve as a virtual power plant (VPP), as described by Sunverge in a presentation to PJM stakeholders in June – the first battery energy storage residential VPP to participate in PJM’s wholesale markets.

The project was approved by the Maryland Public Service Commission under the Maryland Energy Storage Pilot Program and was subsequently introduced to PJM stakeholders through the Emerging Technologies Forum, a stakeholder group established to support PJM’s Advanced Technology Pilot Program. PJM’s pilot program provides a transparent testing ground to study the viability of integrating emerging technologies that enhance system reliability, operational and market efficiency, and resilience.

“The Elk Neck Battery Storage Pilot Project will allow aggregated DER to test the markets under real-world conditions, providing lessons for PJM and all its stakeholders in alignment with the spirit of FERC Order 2222,” said Eric Hsia, Senior Manager – Applied Innovation. “Pilot projects like Elk Neck give all of our stakeholders a window into the innovative work going on among our members.”

The VPP will participate in the ancillary services markets under PJM’s demand response model, through which resources are paid for their ability to modify load in response to instructions from the grid operator, which in this case is PJM.

Lessons learned will be critical, because PJM is currently working with stakeholders on proposed rules for DER aggregation market participation under Order 2222.

Order 2222 will establish the rules for the grid of the future – how all customers, including the smallest residential customers, will interact with PJM, their local utility and the markets, and how they can be appropriately compensated for their contributions to system reliability.

The project is scheduled to be fully operational in Q1 2022.

The pilot program provides a unique use case for the PJM footprint. It will offer operational coordination with the aggregator and utility, locational modeling of DER, and retail customer load interactions.

When/if coupled with solar, it could help with understanding load impacts, and the data could improve PJM’s behind-the-meter generation solar forecast. The Emerging Technologies Forum provides a centralized, open forum for education on emerging grid technologies; identification of issues that should be explored concerning operations, planning and markets; and recommendations for addressing those impacts.