Virtual Power Plant (VPP)
A decentralized network of residential battery storage systems coordinated by smart cloud software to supply power to the electrical grid during peak demand events.
A Virtual Power Plant (VPP) aggregates hundreds or thousands of distributed energy resources (DERs)—primarily residential home battery systems—into a unified, controllable energy asset.
During periods of severe electrical grid strain (such as summer heatwaves), utilities activate the VPP. Participating batteries discharge a portion of their stored energy to stabilize grid frequency and prevent blackouts, and homeowners receive direct cash payouts or utility bill credits.
Why it matters
Enrolling in a VPP transforms a home battery from a purely defensive backup asset into an active income generator, earning $300 to $1,500 in annual revenue.
Example
A homeowner participating in the ConnectedSolutions VPP earns $275/kW annually, receiving a $2,200 direct check from the utility every autumn.