Google and the distributed-energy company Voltus announced on Oct. 22 that they will build a virtual power plant in the PJM grid region large enough to exceed 1 gigawatt. The new agreement adds 1,070 megawatts to a 100-megawatt deal signed in June, a tenfold step up in the commitment. Google pays for the capacity, and Voltus assembles it from homes and businesses.
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Ellen Zuckerman, Google’s head of energy market development for North and South America, said distributed energy resources are powerful tools for managing a modern, reliable grid while keeping energy affordable.
How Voltus pools batteries, thermostats and factory loads
According to the Voltus announcement, the company aggregates new capacity from local businesses and homes into a Google-funded plant. When the grid is strained, Voltus signals participating sites, which cut energy use through batteries, smart thermostats, industrial process adjustments and other flexible assets. Participants receive bill savings and direct payments. Voltus CEO Dana Guernsey said the expansion turns data center growth into direct economic benefits for businesses and households.
The release describes a 1 gigawatt project, yet the stated pieces, 100 MW plus 1,070 MW, add up to about 1,170 MW, and the company does not reconcile the difference. Utility Dive’s report on the expansion characterizes it as growing the plant by a factor of 10.
The original June agreement was a three-year, 100-megawatt commitment under which Google pays customers in PJM to join the plant and Voltus takes on Google’s capacity obligation. PJM serves 67 million customers across its 13 states and the District of Columbia. The Voltus release cites a Brattle Group estimate that American consumers could save more than $100 billion over the next decade through better use of the grid.
PJM’s capacity squeeze and the demand response money
PJM is the largest U.S. wholesale power market, overseeing the grid in 13 states and the District of Columbia, and it has recently fallen short of its reliability margins despite high capacity auction prices, largely because of data center demand. The market monitor, Monitoring Analytics, reported that demand response revenue in PJM rose 240% from 2024 to 2025, mostly on higher capacity prices, and that emergency demand response made up 88% of the total. The 2025 state of the market report has the underlying tables. Voltus says users in PJM can earn up to $350,000 per megawatt-year from demand response.
The deal is Google’s answer to a policy fight. PJM proposed a self-supplied new capacity framework this year, and FERC largely rejected it earlier this month. Monitoring Analytics has pushed for rules that make large loads supply their own new generation before connecting.
The same explainer also quotes Mary Yang, chief operating officer of 804 Advisory, saying today’s conditions require thinking about distributed capacity, and Xcel Energy’s Lon Huber arguing it can support load growth that puts downward pressure on rates. Voltus has also acquired battery developer Brightfield, according to that report, a sign that the company wants to own more of the hardware it aggregates.
The scale of the squeeze is visible in the load data. PJM hit a record peak of 168.2 GW on July 2, and a 2025 Department of Energy study found distributed resources could meet up to 20% of U.S. peak load needs by 2030. Distributed capacity also avoids the years-long interconnection queues that hold up conventional plants, which is why the aggregators say they can add megawatts faster.
A ramp through 2040 and what remains unsettled
Voltus spokesperson Sarah Spitz said the company expects to ramp to full capacity over three to four years and then run the plant under the Google contract through 2040. Voltus holds about 8.5 GW of distributed assets under contract across North America and wants 20 GW by the end of the decade, backed by a recent $225 million Series D round.
The original June deal was framed by Voltus chief regulatory officer Jon Wellinghoff as a turning point for markets treating distributed capacity like any other capacity resource, a view reported in Utility Dive’s look at what the PJM plant signals. Others there were less sure. Pivot Energy CEO Tom Hunt said the products and market mechanisms may not be certain for 10 years. A Brattle Group report on residential virtual power plants estimates large consumer savings, and Utility Dive’s coverage of the BloombergNEF storage outlook appeared the same week. Rival aggregators are racing alongside. Budderfly and Schneider Electric announced a 150 MW, $500 million plant, Sunrun, Renew Home and Tesla a 16 MW one, and Pacific Gas and Electric is working with Google and Rewiring America on a pilot to enroll more than 20,000 customer-owned devices in the San Francisco Bay Area. PG&E spokesperson Paul Doherty said the scaled version of that program does not exist yet. Utility Dive notes the comparison Guernsey draws to power purchase agreements, which she says revolutionized utility-scale solar and wind development, and the same logic now applies to flexible load. The open question is whether state regulators in PJM create programs to pay for demand-side capacity at scale.
This article was produced with the assistance of AI and reviewed by Morning Overview editors prior to publication.
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