Stem Inc. activated several of its virtual power plants, networks of energy storage systems located at business and institutions throughout the state, multiple times during a heat wave last week, automatically dispatching stored energy to provide emergency demand response services to the California System Independent System Operator (California ISO) and three power utilities.
As a heat wave approached California on June 19, 2017, energy prices in the day-ahead wholesale market rose, signaling a need for resources that could act quickly to increase energy supply or reduce demand to prevent widespread blackouts. Having regularly offered stored energy from its network into the California ISO markets since 2015, Stem’s latest bids started to clear.
Stem first committed to reduce energy demand for Pacific Gas & Electric (PG&E) and Southern California Edison at 5 pm PT on June 20 through the Day-Ahead settlement process the night before. Then at 5:15 pm on June 20, while already dispatching in four areas within the PG&E and SCE service territories, additional Stem offers to provide energy with less than five minutes’ notice were accepted further south in three parts of San Diego Gas & Electric’s (SDG&E) service territory. Stem stepped up, dispatching energy storage systems at customer locations across seven utility zones to deliver on-time and more than promised.
In this one hour, Stem delivered stored energy from its customer network to seven strained areas of the CA grid simultaneously at the height of a heat wave. Acting as virtual power plants, aggregations within the Stem network automatically responded to rising wholesale prices in as little as five minutes to dispatch 1.6 MW of targeted relief, 21 percent more than committed. Stem’s network similarly dispatched fast, on-demand power 10 more times across the three utilities’ service territories in the remainder of the week as the heat continued.
In California, Stem uses the CAISO Proxy Demand Response (PDR) mechanism to aggregate DERs, and has been a very active participant in their wholesale market over the last three years. CAISO prices have cleared higher than the bids of storage-based demand response providers more frequently than expected in 2017. For example, Stem’s network responded to 150 “real-time,” or five-minute dispatch events for SDG&E from January to May of 2017. Stem is the leader in bidding aggregated distributed energy resources (DERs) into wholesale markets in California and across the U.S.
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