Sidewalk Infrastructure Partners LLC will invest $100 million in San Francisco-based smart-grid startup OhmConnect Inc. and its planned "largest residential virtual power plant in the world," a 550-MW network of distributed energy resources spread across California, the companies announced Dec. 7.
The transaction includes an $80 million financing commitment for the project, known as Resi-Station, and a $20 million equity injection into OhmConnect. The project capital will allow OhmConnect to greatly expand its current base of roughly 150,000 customers and to subsidize their purchase of home energy devices, including smart plugs and thermostats, electric-vehicle charging ports and battery-storage systems.
The devices connect to a web-based platform that enables the company to control them at key moments, primarily during early-evening peak power demand, and to bid aggregated demand-side energy reductions into the California ISO wholesale energy market as power and compensate customers for their savings.
"We look to the California grid just like a peaker power plant," OhmConnect CEO Cisco DeVries said in an interview. "We get dispatched ... the same way, we get paid exactly the same way."
While home solar specialist Sunrun Inc. and residential battery supplier Sonnen Inc. are building virtual power plants based largely on stored solar energy, OhmConnect is focusing foremost on harnessing energy savings through "smart plugs" that connect to major appliances and energy-hungry entertainment centers in homes.
"You just plug into the wall, connect it on the app, plug something into it and then 'boom' ... we can control it remotely and pay you for the reductions it achieves," DeVries said. For many appliances, such as refrigerators and freezers, "you don't even know we're doing it."
'Force multiplier'
The investment from Sidewalk will enable the company to aggregate 100 MW of existing and contracted customers beginning in January, said DeVries. By next summer, OhmConnect hopes to double that to roughly 200 MW while adding hundreds of thousands of new customers to reach full build-out of 550 MW by 2023.
Once completed, Resi-Station could supply 5,000 MWh of energy conservation, equaling California's energy shortfall in August, according to the company. The state's first rolling blackouts in two decades highlighted the need to organize distributed energy assets into clusters of controllable assets to assist with grid reliability.
"With this distributed clean power plant ... we are rethinking the structure of modern power grids, allowing them to function more like a symphony than a solo — a sequence of energy-taking and energy-giving systems that communicate and cooperate with one another to deliver electricity safely, cheaply, and efficiently," Jonathan Winer, co-CEO of Sidewalk Infrastructure Partners, said in a statement.
Backed by Alphabet Inc., the parent of Google LLC, and the Ontario Teachers' Pension Plan, Sidewalk builds, owns and operates advanced infrastructure projects and invests in technology companies.