Brattle Report: Residential Virtual Power Plants Could Cut Household Electricity Bill Increases by More Than Half
A new report from The Brattle Group suggests that scaling residential virtual power plants (VPPs) could reduce expected household electricity bill increases by more than half over the next five years. By aggregating flexible technologies like smart thermostats, electric vehicles, and behind-the-meter batteries, VPPs can help lower system costs and pass savings to consumers. The report estimates that an additional 25 GW of residential demand flexibility could generate $4 billion to $7 billion annually in financial benefits for U.S. households. This includes shared cost reductions across ratepayers and direct payments to participating customers. The analysis highlights the potential for VPPs to provide dependable capacity, especially during peak system stress. Currently, residential demand response accounts for about 1% of utility system peak demand nationwide. If utilities reached a target level similar to top performers (4%), Brattle estimates that VPP capacity could more than triple from approximately 10 GW to 35 GW.
Topics: Demand Response Electricity Costs Smart Home Technology Virtual Power Plants