Google is expanding its efforts to contract distributed capacity to help meet its power needs in the PJM Interconnection with the addition of 1,070 MW to an initial 100-MW virtual power plant agreement it signed with Voltus in June, the companies said Thursday.
Under the agreement, Google will pay Voltus to aggregate distributed resources from residential, commercial and industrial customers. The resources can include batteries, smart thermostats, on-site generation, industrial process adjustments and other flexible assets that can reduce energy use, the companies said.
Voltus will offer the combined resources into PJM’s market when the grid is strained, they said.
Such contracts signal a turning point for distributed resources in energy markets, industry sources say. In previous comments to Utility Dive, Voltus CEO Dana Guernsey compared them to the power purchase agreements that unlocked financing for utility-scale wind and solar.
Voltus expects to ramp up to the VPP’s full capacity over three to four years and then to run it under a contract with Google through 2040, Sarah Spitz, a spokesperson for the San Francisco-based demand response company, told Utility Dive in an email.
PJM, the largest U.S. wholesale power market, oversees the grid in 13 states and the District of Columbia. The grid operator has recently fallen short of its reliability margins despite skyrocketing capacity auction prices, due in large part to rising demand from data centers.
Demand response revenue in PJM jumped 240% from 2024 to 2025, reaching $523.5 million, mainly due to higher capacity prices and increases in capacity market revenue, Monitoring Analytics, the grid operator’s market monitor, said in its annual market report released in March.
Emergency demand response accounted for 88% of all demand response revenue, the market monitor added.
Energy users in PJM can earn up to $350,000/MW-year through demand response-related payments, according to Voltus. In addition to providing direct financial benefits for VPP participants, virtual power plants can put downward pressure on electric rates by reducing peak demand, according to a report The Brattle Group released this month.
Voltus has about 8.5 GW of distributed assets under contract across North America, according to the company. It aims to have 20 GW under contract by the end of this decade, in part by advancing its Bring Your Own Capacity initiative, the company said earlier this month, after it raised $225 million in its latest funding round.
“Distributed energy resources are powerful tools for managing a modern, reliable grid while keeping energy affordable,” Ellen Zuckerman, head of energy market development for North & South America at Google, said in a press release. “Expanding our initial commitment tenfold demonstrates our core effort to actively bring our own capacity to the grids that serve us.”
Amid tight power supply conditions in PJM, Monitoring Analytics has been pressing for requirements that data centers and other large loads supply their own new generation before they are allowed to connect to the grid.
Earlier this year, PJM proposed a “bring your own new capacity” framework that included a plan for curtailing power deliveries to large loads without new power supplies when the grid is stressed. The Federal Energy Regulatory Commission largely rejected the plan earlier this month.
The Google-Voltus agreement is the latest in a string of VPP announcements. Others include a 150-MW, $500 million VPP from Budderfly and Schneider Electric; a 16-MW VPP developed by Sunrun, Renew Home and Tesla; and a VPP offered by Pacific Gas & Electric, along with Rewiring America, Google, Carrier Global Corp., Tesla, Sunrun, Renew Home, Demand Side Analytics, encoord and other partners.
