Virtual power plants face new grid test

In 1950, English mathematician Alan Turing invented what he called “the imitation game.” Later nicknamed the Turing testThe experiment asks a human participant to conduct a conversation with an unknown partner and try to determine whether it is a computer or a person on the other end of the line. If the person fails to understand it, the machine passes the Turing test.

Power grid operators are now gearing up for their own version of the game. Virtual power plants, which string together small distributed energy resources, are increasingly being leveraged to balance electricity supply and demand. The question is: can they do their job as well as conventional power plants?

Grid operators can now find out by operating these power plants using a Turing-like test called Huels. To pass the Huels test, the performance of a virtual power plant must be identical to that of a conventional power plant. A human network operator acts as judge.

Virtual power plant developer EnergyHub, based in Brooklyn, New York, developed the test and described it in a white paper released today. “What we’re really trying to do is fool operators into believing that these virtual power plants can act, feel and smell like conventional power plants,” says Paul Hines, chief scientist at EnergyHub. “It’s kind of the first litmus test.”

What are Virtual Power Plants (VPP)?

The question of virtual or conventional power plants is topical. Virtual power plants, or VPPs, are networks of devices such as rooftop solar panels, home batteries and smart thermostats that come together through software to collectively provide or conserve electricity..

Unlike conventional power generation systems, which can operate a large gas plant when electricity demand peaks, VPPs operate small, widely distributed equipment. For example, a VPP could harness electricity from hundreds of plugged-in electric vehicles or rooftop solar panels. Or it could direct smart thermostats in homes or businesses to turn down heating or cooling systems to reduce demand.

This technology is emerging at a time when concerns about data center electricity demand are reaching a fever pitch. Consulting firm BloombergNEF estimates that U.S. data center energy demand will reach 106 gigawatts by 2035, a 36% jump from what it projected just seven months ago.

How utilities and grid operators will respond to growing demand is unclear and faces challenges on many fronts. Turbines for natural gas power plants are out of stock and new nuclear reactors will still be years away. Wind and solar power, while inexpensive and quick to build, do not produce the 24/7 electricity demanded by data centers, and face an uphill political battle under the Trump administration.

All of this together created an opening for VPPs, which could add gigawatts to the grid without significantly increasing electricity rates. “It’s a political question. If you say you’re going to get electricity costs under control, that’s literally the only way to do it in 12 months,” says Jigar Shah, a clean energy investor at Multiplier in Washington, D.C., who led the U.S. Department of Energy’s lending programs office during the Biden administration.

VPPs could also reduce the need for utilities to invest in distribution equipment, avoiding supply chain shortages and cost inflation, Shah says. “There is no other idea that you could deploy in 12 months that would have such a big impact,” he says.

According to a 2024 U.S. Department of Energy report, VPPs could provide between 80 and 160 gigawatts of capacity across the United States by 2030, enough to meet between 10 and 20 percent of the grid’s peak demand.

How can VPPs gain the trust of network operators?

But first, VPP developers need to convince grid developers. Criteria such as the Huels test are crucial to building this trust. “For us to increase our reliance on VPPs, they need to pass the Huels test and operators need to be able to rely on” VPPs to provide power when called upon, said Lauren Shwisberg, director of the nonprofit research group Rocky Mountain Institute who co-authored a recent report on VPPs and was not involved in developing the test.

Matthias Huels, an engineer who spent more than four years at EnergyHub, first came up with the idea for the test in 2024. After working on the idea with colleagues and, ironically, ChatGPT, Huels presented the concept to the company.

Huels designed the test subjectively. Currently, in its first version, it appears to follow a guideline similar to the Supreme Court’s “I know it when I see it” test for what distinguishes pornography from erotic art. In other words: the success of the test depends on the judge. If a grid operator finds the energy from a VPP as reliable as electricity from a real power plant burning gas to produce electrons, then the VPP is adopted.

The Huels test has four levels. To achieve Level 1, a VPP must be able to reduce network demand, for example by successfully programming smart thermostats to decrease when the network is experiencing peak demand. To achieve Level 2, a VPP must be able to respond to market and grid data and reduce demand when prices reach a certain level or harness solar panels or batteries when electricity is needed. Human decision-makers are involved at these levels.

Passing the Huels test comes in at Level 3. This is where a VPP can operate automatically because it has proven reliable enough to be indistinguishable from a gas peaker plant – the type of power plant that is brought on as a backup only when the grid is under stress. Passing Level 4 involves VPPs acting completely autonomously to adjust production based on a number of variables that actively change throughout the day.

“The imitation game that Alan Turing imagined was: Can a computer fool an interrogator into thinking it’s actually human, even though it’s a computer,” Hines explains. “We’re proposing this testing idea that would allow us to say: Can we fool a grid operator into believing that what actually solves their problems is this aggregation of many devices instead of one big gas plant?”

Can VPPs imitate peaking gas plants?

Peaker power plants only produce electricity about 5% of the time over their lifespan. This makes them easier for VPPs to imitate because, as with peaking plants, the limited amount of energy that can be made available through demand response or harvested from batteries only provides bursts of energy that last a few hours at a time.

It’s much harder to compare to a large-scale gas plant, which operates 65 percent of the time or more, or a nuclear plant, which typically operates at least 95 percent of the time. To achieve this, a VPP network would need to be equipped with long-duration storage that could be powered during the day when the solar panels are operating at maximum power and discharged overnight. “You start talking about VPPs that have large amounts of batteries that can run 365 days a year,” Hines says. “This is a path we can take.”

EnergyHub has submitted its VPP systems to the Huels test. Last year, EnergyHub conducted successful trials with the Arizona utility, Duke Energy in North Carolina and National Grid in Massachusetts. In Arizona, EnergyHub’s software connected homes with solar panels and smart thermostats and ran air conditioners to “pre-cool” homes during the day, when the sun generated lots of electricity. That allowed the state’s largest utility to reduce demand during peak hours, when residents typically returned from work to turn on their televisions and run their air conditioners.

“You have too much electricity in the middle of the day from solar, and then the early evening comes and people increase their consumption in the evening just as the solar is decreasing,” Hines says. “You need something that can meet that schedule. We created something that can do that.”

This places the company between 2 and 3 on the Huels testing scale. Getting past Level 3 “is going to take a few years,” Hines said.