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Power

Google Will Pay Homes and Businesses to Use Less

Google will fund 1,070 more megawatts from homes and businesses that cut their use when PJM’s grid is strained, a virtual power plant of over a gigawatt.

SAN FRANCISCO, Oct. 22 — Google is paying for a power plant made of other people’s batteries and thermostats. Google and Voltus, a San Francisco company that pools such equipment, said on Thursday that Google would fund 1,070 more megawatts for a “virtual power plant” in the grid run by PJM Interconnection, on top of the 100 megawatts they agreed on in June.

When the grid is under strain, Voltus signals the homes and businesses that have joined, “which then can use batteries, smart thermostats, industrial process adjustments and other flexible assets to reduce energy use,” the companies said. Participants get “bill savings and direct payments.” The announcement gave no value for the contract.Virtual Power PlantSoftware links many small resources so that they act as one, Voltus says: when demand spikes, it discharges batteries or adjusts thermostats at thousands of sites at the same moment. Voltus offers the pooled resources into PJM’s market when the grid is strained.

Who supplies the power that data centers need, and who pays for it, is being argued across PJM’s 13 states and the District of Columbia this fall. PJM’s staff proposes to bill its backstop purchase of new capacity to the zones where large loads are growing, and President Trump wrote on Oct. 21 that large new data centers are “mandated by me to make their own electricity.” Google’s answer here is to pay for flexibility: the two agreements come to 1,170 megawatts, by Daily Cortex’s sum, that homes and businesses can take off the grid when it is strained.

“Expanding our initial commitment tenfold demonstrates our core effort to actively bring our own capacity to the grids that serve us,” said Ellen Zuckerman, Google’s head of energy market development for North and South America, in the companies’ announcement. Dana Guernsey, Voltus’s chief executive, said in the announcement that the expansion “translates data center growth into direct economic benefits for businesses and homes.”

Voltus expects to take three to four years to reach full capacity and then to run the plant under its contract with Google through 2040, Sarah Spitz, a Voltus spokesperson, told Utility Dive in an email; the June agreement was for three years. Energy users in PJM can earn up to $350,000 a megawatt-year through payments related to demand response, Voltus says.

Those payments have grown quickly. Demand-response revenue in PJM rose 240.6 percent in 2025, to $523.6 million from $153.7 million, primarily because of higher capacity-market revenue, according to Monitoring Analytics, PJM’s independent market monitor. Emergency and pre-emergency demand response earned 87.9 percent of it.

The gainers are households and businesses with batteries to draw on or equipment they can turn down, and the companies that pool them. In August, Sunrun, the home solar and battery company, agreed to supply Voltus’s programs for AI hyperscalers, which the two did not name, with capacity from a portion of its home systems in the PJM and MISO grid regions.VoltusA San Francisco demand-response company, it raised $225 million on Oct. 8 in a round led by Generation Investment Management, and says it has about 8.5 gigawatts of distributed assets under contract across North America. It expects to grow its platform to 20 gigawatts by 2030.

The companies’ announcement and PJM’s published consultation documents do not say whether Google’s megawatts would count against the shortfall that the backstop is meant to fill. PJM’s draft tariff, posted ahead of its consultation with members on Thursday, lets new capacity contracted for at least five years to serve a new large load reduce the amount the backstop must buy, and it counts planned demand resources and aggregations of distributed resources among those that can supply such offsets, if they meet the backstop’s eligibility rules. Voltus’s contract with Google runs through 2040. Neither the announcement nor Utility Dive’s report mentions the backstop.

The other route is to build, and to borrow. Atlas Energy Solutions, of Austin, Tex., said on Thursday that it had closed a $424 million bridge facility from Goldman Sachs and Barclays, drawing $171 million at closing, to order generating and related equipment for two data-center projects while it works toward final agreements with its customer; first power for both is expected in late 2027. The facility is backed by cost-reimbursement agreements; John Turner, Atlas’s chief executive, said in the release that its customer, which it did not name, had shown conviction through “their willingness to backstop the purchase of this equipment and the related bridge facility.”

PJM plans to file its revised backstop rules with the Federal Energy Regulatory Commission on Oct. 29, the day after Alphabet, Google’s parent, reports its third quarter.

Sources

  1. Voltus, “Google and Voltus Announce One Gigawatt Bring Your Own Capacity Agreement in PJM,” Oct. 22, 2026.
  2. Utility Dive, “Google supersizes PJM virtual power plant to more than 1 GW,” Oct. 22, 2026.
  3. Voltus, “Voltus and Google to Deliver Grid Capacity and Local Economic Benefits Through Bring Your Own Capacity Agreement,” June 2, 2026.
  4. PJM Interconnection, “Tariff, Section 9.2(b) Stakeholder Consultation of Upcoming 205 Filing on Reliability Backstop Procurement (Special Members Committee presentation),” Oct. 22, 2026.
  5. PJM Interconnection, “Updated Tariff Revisions, redline (Special Members Committee, Oct. 22, 2026),” Oct. 22, 2026.
  6. Monitoring Analytics, “2025 State of the Market Report for PJM, Section 6: Demand Response,” March 12, 2026.
  7. Voltus, “Voltus Raises $225 Million to Make Flexibility Foundational to the Grid,” Oct. 8, 2026.
  8. Sunrun and Voltus, “Sunrun to Supply Voltus with Energy Capacity for AI Hyperscaler Agreements,” Aug. 17, 2026.
  9. Atlas Energy Solutions (SEC Form 8-K, Exhibit 99.1), “Atlas Energy Solutions Announces $424 Million Senior Secured Bridge Facility Provided by Goldman Sachs and Barclays,” Oct. 22, 2026.
  10. Trump’s Truth (archive of Truth Social), “Donald J. Trump, Truth Social post of Oct. 21, 2026, 1:37 a.m. EDT (status 117477279556215047),” Oct. 21, 2026.
  11. Alphabet, “Alphabet Announces Date of Third Quarter 2026 Financial Results Conference Call,” Oct. 6, 2026.