After Virginia Gov. Abigail Spanberger’s campaign pledge to lower the cost of living helped Democrats win their largest majority in the state house in decades, advocates of getting more out of the existing grid saw an opportunity.
A major driver of rising energy bills is the cost of building out poles, wires, and other grid infrastructure that serve new data centers, electric car chargers, and manufacturing plants. But even as demand grows to unexpected heights, there is a lot of unused capacity already on the grid. Last year, Duke University researchers found that the grid operated at 53% of its capacity across 22 regional systems — and across the U.S. there may be 100 gigawatts to spare, if only utilities and state energy regulators could both measure and unlock the extra room.
The concept of “grid utilization” has grown in popularity in the last year, and in January landed on Spanberger’s “Affordable Virginia Agenda” — as the result of work between her transition team and Deploy Action, a group advocating for state policies that accelerate clean energy deployment. Then last week, a first-of-a-kind bill that would direct state energy regulators and the utilities Dominion Energy and Appalachian Power to develop ways to quantify and reduce waste on the grid cleared the legislature. It now awaits the governor’s signature.
The quick turnaround in Virginia is due in part to Democrats’ supermajority in the state, but also to this unique inflection point in the energy transition. Elected officials, hyperscalers, and utilities are all under pressure to curb rising energy bills while also serving massive load growth from data centers, electric cars, and manufacturing plants. Otherwise, the U.S. risks exacerbating the affordability crisis and a stagnated economy.
A new coalition is looking to ride this momentum. The Utilize Coalition, a nonpartisan, state-focused advocacy group, launched on Tuesday to build on the efforts in Virginia. “We think this could be a model for states across America, and can help us transform the way we build our grid, less towards ‘peak’ and more towards ‘system-wide utilization’ — saving Americans billions of dollars in the process,” Ian Magruder, the group’s executive director, recently said on LinkedIn about the Virginia law.
Founding members of the group include Carrier, Google, Renew Home, Sparkfund, SPAN, Verrus, and Tesla. Some of those companies backed the bill in Virginia, Utilize said, though the group did not specify which ones.
Grid utilization is enticing for hyperscalers like Google, who are in a speed-to-power race; Google is also exploring data center flexibility as a way to connect to the grid faster and in fact hired Tyler Norris, the author of last year’s Duke report, to work on the issue for the company. Sellers of distributed energy resources like Tesla, which is reviving its home solar business, also stand to benefit if more utilities try virtual power plants. Meanwhile, hardware and software companies like Span are making tools for homeowners and utilities to see and manage energy assets in real-time.
“For decades, we’ve built the grid to meet peak demand, even though large portions of it sit unused for most hours of the year,” said Magruder in the announcement of Utilize’s launch. “That excess capacity is hiding in plain sight, and new technologies give us the opportunity to unlock it.”
Behind the negotiations
The bill in Virginia would require Dominion Energy and Appalachian Power to petition state energy regulators this year to develop grid utilization performance metrics. After those are finalized, utilities would collect the data, and regulators would analyze if non-wires alternatives — such as battery storage or grid-enhancing technologies — are faster and cheaper approaches to solving grid constraints.
The bill passed the House with nearly unanimous bipartisan support. It was met with a party-line split in the Senate, where some Republican lawmakers raised concerns that greater grid utilization may be a risk during extreme weather events, when the grid can run at max capacity.
Dominion Energy, for its part, didn’t take a public stance on the bill. An official representing the utility did testify during committee hearings, however, and said it was “headed in the right direction.”
Kyle Winslow, a policy advisor for Deploy Action, told Latitude Media that Dominion was a “good partner” during the negotiations. He added the bill complements work that some utilities are already considering, such as on demand-side response and management at the residential, commercial, and industrial levels. Dominion — under a law signed by former Virginia Republican Gov. Glenn Youngkin — in December proposed a virtual power plant program that would aggregate up to 450 megawatts of DERs like residential batteries and solar.
“This is about looking at existing poles and wires to identify efficiencies, and where those complementary tools can help reduce peak demand, balance load, and offer flexibility,” Winslow said.
Whether groups like Deploy Action and Utilize Coalition can replicate the success in Virginia across other states remains to be seen. Winslow said New Jersey, where Democratic Gov. Mikie Sherrill campaigned on energy affordability, is a potential next target.
