The vital role of demand response in California, with Leap

Demand response is a critical piece of the clean energy transition. Surging energy usage and increasing extreme weather events means California is under pressure to not only produce clean energy, but to also ensure grid stability and keep dirty peaker plants offline. We spoke to Leap ’s Co-Founder and CEO Thomas Folker to learn how Leap is partnering with WattCarbon to supercharge the creation of virtual power plants (VPPs) to support spiking demand and ensure clean energy goals are met.

The big idea

The cleanest watt-hour is the one you never use. That’s what Leap says, an energy company that’s using small energy devices to drive big impact.  Reconciling surging energy demands with increasing extreme weather events, Leap believes that enabling smart energy devices of all sizes to connect to the grid will help create a cleaner, more flexible, and more resilient grid, lowering the need to use fossil fuel power plants.

How demand response works

In a nutshell: demand response is like getting paid to take spring break a week early. You avoid inflated prices, miss the crowds, and benefit more from your holiday!

Translated: demand response cleans up the grid by shifting energy usage to cleaner hours of the day. Leap aggregates hundreds of thousands of distributed energy resources (DERs) to be part of  “virtual power plants” (VPPs) to support the grid, enabling all types of energy users to contribute to grid resilience. This includes things like battery storage, EV chargers, smart thermostats, heat pumps, rooftop solar, and more.

When energy demand is spiking, peaker plants are typically fired up to fill those needs. These peaker plants are deadly: it takes 50% more gas to operate peaker plants compared to cleaner combined-cycle plants that provide our baseload power. By shifting energy usage to different hours, we can prevent those peaker plants from being used. This immediately cuts carbon emissions and provides environmental justice benefits for the communities surrounding peaker plants, which are disproportionality communities of color and/or low-income.

“A lot of times, solar captured during the day might not get its full use. Virtual power plants can help smooth out that energy demand, making it easier for renewable energy to integrate,” explains Folker.

Give me an example

Picture this: Leap helps a major retailer participate in demand response. When peak demand is expected, the retailer shifts its energy loads to hours with lower demand ––they might pre-cool their refrigerators from 2-4pm, instead of 4-7pm. The retailer gets paid for shifting their load, balances the grid, and delivers immediate emissions savings.

But that’s not all! With WattCarbon, now the retailer also gets paid for those carbon emissions savings resulting from their demand response, creating another incentive for more folks to participate. It’s a win-win-win!

Keeping the lights on during extreme weather

As extreme weather events increase, the need for mass-scale demand response becomes even greater.

In 2022, when California experienced a historic early September heat wave, Leap’s partner community helped to keep the lights on. Through virtual power plants’ contributions to grid stability, Leap virtually aggregated a portfolio of 77MW in flexible load across 24 technology partners, calling in over 21,000 unique DER devices to reduce energy consumption and/or deliver energy back to the grid.

Despite this triumph, there’s still a way to go. Voluntary contributions - like people manually turning down their AC - were still vital to keeping the lights on in 2022. Additional incentives and awareness for demand response will be key to leveraging this high impact solution.

“We can enable any smart device to support the grid. Any homeowner or business can be part of a virtual power plant,” explains Folker. “By partnering with WattCarbon, we’ll be able to bring VPPs made of EV chargers, heat pumps, and battery storage to corporate energy buyers, to create the next frontier of decarbonization efforts.” 

How EACs are helping Leap unlock the environmental value of demand response

Historically, demand response has only been monetized for the energy value, not the carbon savings value. By including additional revenue streams based on carbon savings, Leap can further incentivize customers to participate, and add hundreds of thousands of new devices into their VPP fleets.

“WattCarbon is a really important piece of the puzzle right now, because it can be difficult to quantify the carbon impacts of demand response. So having it defined in the WEATS Marketplace puts an actual price on the environmental value,” shares Folker.

As a clean energy buyer, how can I invest in demand response? 

Easy! WattCarbon creates Energy Attribute Certificates (EACs) for every watt-hour of energy that’s saved through demand response. You can buy those EACs on the WattCarbon Marketplace and claim them against your clean energy goals. Your cash will reward folks for participating and incentivize more people to get involved, keeping toxic peaker plants offline, and supporting environmental justice communities. 

Clean energy that benefits people, planet, and profit.

The future of demand response: the optimized home

Looking ahead, Leap sees the future of the ‘‘optimized home”. Every energy consumer will be seamlessly plugged into the distributed energy economy, contributing multiple devices to participate in demand response programs that tick along in the background. 

Folker shares that, “we see a future where everything is optimized and integrated––saving energy, pollution and money for everyone––from homeowners to grid operators to corporate energy buyers, because distributed energy unlocks clean and healthy futures for everyone, not just the few.”

Get involved

Interested in learning more? Discover EAC opportunities with Leap on the Marketplace. 

This article is part of WattCarbon’s Every Watt-Hour Tells A Story series, spotlighting how WattCarbon partners are deploying distributed clean energy to achieve climate impact, here and now.