Dive Brief:

• Texas regulators want to expand an 80 MW distributed energy resource pilot launched last year, concluding that virtual power plants are helping improve grid reliability and more customer batteries should be harnessed across the Electric Reliability Council of Texas market.
• The aggregated distributed energy resource pilot, or ADER, was approved by the Public Utility Commission of Texas in November 2023 and has been “a significant success for Texas,” Commissioner Will McAdams said at the commission’s open meeting on Thursday.
• Other proposed changes to the ADER program include updates to its telemetry validation methodology and clarifications to procedures for checking whether resources are already enrolled in other ERCOT programs. McAdams also said he would like to see greater participation in the program from electric cooperatives and municipally-owned utilities.

McAdams, who helped spearhead the ADER pilot, announced his retirement from the commission at the Thursday meeting. He was the first commissioner appointed to the reconstituted PUCT after its members resigned in 2021 following Winter Storm Uri.

The February storm resulted in widespread blackouts and almost 250 deaths, and ultimately spawned efforts to redesign Texas’ energy markets and strengthen the electric grid, including the integration of distributed energy resources.

McAdams said he is leaving the agency after assessing his “work-life balance” but also feels this is “a time for new blood to come in and continue the momentum that we have and started here.” That will include the ADER pilot and development of more virtual power plants in Texas, which will be overseen by Commissioner Jimmy Glotfelty.

“We have not yet achieved the potential of what these things can do,” Glotfelty said. Expanding the program is “critical if we want to grow these into major reliability tools. ...the retail providers and the others that are creating [virtual power plants] need critical mass ... otherwise they’re spending marketing dollars on just a few customers.”

The ADER project was launched after Tesla expressed interest in aggregating Powerwall batteries in Texas homes. The expanded program would allow aggregated resources to participate in ERCOT’s contingency
reserve service, or ECRS, according to a joint memo filed by Glotfelty and McAdams. ERCOT launched ECRS in June to support grid reliability and address real-time operational issues.

The ADER program should also consider how to engage more “non-opt-in-entities,” or NOIEs, which are load serving entities that do not participate in the competitive retail market, typically including electric co-operatives or municipally owned utilities.

“Unlocking the business case for NOIEs will be a great benefit to the state,” McAdams said. “It will serve those rural areas and underserved areas.”