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Analysis from Brattle Group has shown that California’s statewide distributed power plant programme can provide net savings to consumers of up to $206 million over the next three years by tapping into home battery storage.
According to Brattle in their report, The Demand Side Grid Support Program: An Assessment of Scale and Value, California’s state-wide Demand Side Grid Support (DSGS) distributed storage programme is projected to nearly double in capacity by 2028.
This increased capacity, projected to surpass 1GW by 2028, could provide up to $206 million in net cost savings to Californians, says the report commissioned by Sunrun and Tesla Energy.
The report estimates that from 2025 to 2028, the benefits of DSGS significantly outweigh the costs of the programme, providing net system cost savings between $28 million and $206 million, benefitting all grid-connected customers in California. Participants will also benefit from direct compensation for the power they share with the power system.
Commenting in a release was Ryan Hledik, principal at The Brattle Group and co-author of the report: “Our analysis demonstrates that the DSGS program can deliver reliable, utility-scale capacity at a significantly lower cost than traditional solutions.
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“As more Californians instal home batteries, programmes like DSGS will be an important opportunity to tap into those batteries to improve energy affordability, enhance system reliability, and advance decarbonisation goals.”
Launched by the California Energy Commission in 2022, DSGS pays customers to discharge stored energy from residential and commercial batteries during periods of high demand or grid stress.
This “distributed power plant” approach helps avoid costly and polluting fossil fuel peaker plants, improves energy affordability, and reduces the risk of rolling blackouts during heatwaves and wildfires.
As part of its research, The Brattle Group reviewed a recent battery dispatch demonstration event in July that delivered over 500MW to the grid – roughly half the peak electricity demand of San Francisco.
The report explains how there was a visible reduction in net load, with the average reduction of 539MW representing roughly 1.9% of CAISO’s net peak demand during the event.
Mary Powell, CEO of Sunrun, said: “Brattle’s report confirms the incredible power of the massive distributed power plant we have built.
“Aggregating home generation and storage produces a reliable, flexible energy resource that dispatches at the same scale as multiple peak generation plants to help meet soaring electricity demand.”
Colby Hastings, senior director of Residential Energy at Tesla Energy, noted that, “This 539MW VPP (virtual power plant) test event demonstrates how distributed assets can reliably support the grid at scale and reduce costs for all.
“With more than 1.8GW of residential battery capacity already installed in California, the untapped potential is significant. Establishing a permanent pathway for these resources is critical, and we look forward to advancing this work with our customers, partners, utilities, regulators, CAISO, and the legislature.”
Looking ahead, the report recommends that the value of the DSGS programme could be maximised by increasing flexibility in event triggers, integrating the programme’s capabilities more fully into state resource planning initiatives, and optimising dispatch patterns to deliver additional grid services.
The report was co-authored by principal Ryan Hledik, energy associate Kate Peters, and senior energy analyst Purvaansh Lohiya.
