Expanding the Virtual Power Plant with Smart Thermostats
Sonoma Clean Power (SCP), the public power utility serving two counties north of San Francisco, is launching a new initiative to install smart thermostats at no upfront cost for up to 1,000 income-qualified customers. The program, announced last week, is part of a broader strategy to expand SCP's multi-resource virtual power plant (VPP), which already includes thousands of electric vehicle chargers, battery storage systems, heat pump water heaters, and smart electrical panels.
The California Energy Commission provided a $4.99 million grant for the project, and SCP is contributing an additional $1 million of its own funds. The grant and match will also support the deployment of 40 smart panels and battery systems at multifamily properties to increase renter participation, and invest $250,000 in partnerships with community organizations to facilitate multilingual outreach and enrollment. The grant funding runs through the first quarter of 2029.
Addressing Participation Gaps Among Lower-Income Customers
Felicia Smith, SCP's director of customer energy solutions, explained that the VPP builds on a behavioral demand response program with about 12,500 participants. That program is designed to be highly accessible, requiring no technology on the customer's part, and has achieved a 92% response rate in 2025, with participants modifying their electricity consumption after receiving day-ahead phone and email alerts.
However, Smith noted that participation in automated demand response programs has been lower among lower-income and disadvantaged customers. The new smart thermostat deployment aims to close that gap. SCP has identified about 37,000 customers who meet the income qualification requirements for no-cost smart thermostat installation, though not all have central air conditioning. The utility estimates the combined value of the free thermostat and installation labor at approximately $400 per customer.
Community Partnerships and Multilingual Outreach
To ensure the program reaches those who need it most, SCP is investing $250,000 in partnerships with community organizations. These partners will conduct multilingual outreach and assist with enrollment, helping to overcome language and trust barriers that often hinder participation in energy efficiency programs. The focus on multifamily properties, where renters are often left out of such initiatives, is another key component of the effort.
Broader VPP Strategy and State Support
SCP's VPP strategy is part of a larger trend in California, where utilities are increasingly using aggregated distributed energy resources to manage grid demand and integrate renewable energy. The state's Energy Commission has been a key funder, providing grants for projects that demonstrate innovative approaches to demand flexibility. SCP's program is one of several that aim to scale up VPPs while ensuring equitable access for all customers.
The utility serves about 500,000 customers across Sonoma and Mendocino counties. Its existing behavioral demand response program has proven effective, but the addition of smart thermostats and other automated devices will allow for more precise and reliable load reductions during peak events. By targeting lower-income households, SCP hopes to not only expand its VPP but also reduce energy bills for those who need it most.
Implementation and Timeline
Installations are expected to begin later this year, with the goal of reaching 1,000 customers by the end of the grant period in early 2029. SCP will work with community partners to identify eligible households and schedule installations. The smart thermostats will be provided at no cost, and professional installation will be included. Customers who participate will also be enrolled in the utility's automated demand response program, allowing SCP to adjust thermostat settings during grid emergencies in exchange for bill credits or other incentives.
Smith emphasized that the program is voluntary and customers can opt out at any time. The thermostats are designed to maintain comfort while reducing energy use during peak periods, and participants will have control over their settings.
Conclusion
Sonoma Clean Power's free smart thermostat program represents a significant step toward a more equitable and resilient grid. By leveraging state funding and community partnerships, the utility is making demand response accessible to lower-income customers while expanding its virtual power plant. As California continues to face challenges from extreme weather and increasing electrification, programs like this will be essential to maintaining grid reliability and affordability.
This article is based on reporting by Utility Dive. Read the original article.
Originally published on utilitydive.com
