Google Is Paying PJM Homes and Businesses to Use Less Power So Its Data Centers Can Plug In
Google expanded its virtual power plant deal with Voltus on Thursday, adding 1,070 megawatts in PJM, the grid that serves 67 million customers across 13 states and Washington, D.C., Voltus said in a release. A virtual power plant pays homes and businesses to cut their power use when the grid is strained, and the grid counts those cuts as capacity the way it would count a plant.
The two companies signed an initial 100-megawatt deal in June. Voltus signs up sites that can lean on batteries, smart thermostats and adjustments to industrial processes when it sends a signal, and it pays them through bill savings and direct payments. Google funds the program, which Google’s own post calls a 10-fold expansion.
Voltus expects to ramp up to full size over three to four years and then run the program under a contract with Google through 2040, spokesperson Sarah Spitz told Utility Dive. Neither company disclosed what Google is paying. Voltus CEO Dana Guernsey told Latitude Media the capacity offsets load from several Google data centers in PJM and that the first 100 megawatts was “over-subscribed.”
The New York Times put 1,070 megawatts at roughly the output of a large nuclear reactor, and quoted Google’s Ellen Zuckerman calling virtual power plants “a critical short-term solution.”
Google is buying that room on a grid that is already short of it. Each year PJM pays power suppliers to promise they’ll be available at peak demand a few years out, and its July auction, for the year starting June 2028, cleared at the federally approved cap of $325 per megawatt-day across the whole region and still came up 6,831 megawatts short of its reliability requirement. The auction before it fell about 6,500 megawatts short, and PJM said those were the first two in its history where the entire region missed.
What PJM is short of is room at the hours of highest demand, and a data center that wants to plug in has to find some. A thermostat that backs off air conditioning on a hot afternoon is already installed, and Voltus says it can line up enough of them within a few years, a pitch the Times describes as a faster and cheaper option than new plants in the meantime.
Households and businesses that dial back get paid, and the peak capacity they free up counts toward Google’s load. Zuckerman, in Voltus’s release, calls that bringing Google’s own capacity to the grid, capacity that comes from other people’s homes and factories.
Zuckerman’s “short-term” sits next to a contract that runs about 14 years from this announcement, by my math, with roughly a decade of it at full size once the ramp ends. That’s a long purchase for a stopgap.
None of this makes new power. It moves use away from the peak, and the Times notes tech companies will likely still need to build traditional plants to keep building large data centers. Until those plants show up, Google has a growing list of homes and businesses under contract to turn things down when it needs the room.
Sources
- Voltus: Google and Voltus Announce One Gigawatt Bring Your Own Capacity Agreement in PJM
- Google: We are working with Voltus to build a 1-gigawatt virtual power plant
- Utility Dive: Google adds 1,070 MW to Voltus virtual power plant deal in PJM
- Latitude Media: Google is purchasing a gigawatt of distributed capacity in PJM
- The New York Times: To Make Way for Data Centers, Google Will Pay Others to Use Less Power
- PJM: Capacity Auction Procures 138,318 MW of Generation Resources (July 14, 2026)
Discover more from Bitter Fool
Subscribe to get the latest posts sent to your email.