Virtual Power Plants and Energy Justice Brittany Speetles, Eric Lockhart, and Adam Warren National Renewable Energy Laboratory NREL is a national laboratory of the U.S. Department of Energy Office of Energy Efficiency & Renewable Energy Operated by the Alliance for Sustainable Energy, LLC This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications. Contract No. DE-AC36-08GO28308 Technical Report NREL/TP-7A40-86607 October 2023 Virtual Power Plants and Energy Justice Brittany Speetles, Eric Lockhart, and Adam Warren National Renewable Energy Laboratory Suggested Citation Speetles, Brittany, Eric Lockhart, and Adam Warren. 2023. Virtual Power Plants and Energy Justice. Golden, CO: National Renewable Energy Laboratory. NREL/TP-7A40-86607. https://www.nrel.gov/docs/fy24osti/86607.pdf. NREL is a national laboratory of the U.S. Department of Energy Office of Energy Efficiency & Renewable Energy Operated by the Alliance for Sustainable Energy, LLC Technical Report NREL/TP-7A40-86607 October 2023 This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications. National Renewable Energy Laboratory 15013 Denver West Parkway Golden, CO 80401 303-275-3000 • www.nrel.gov Contract No. DE-AC36-08GO28308 NOTICE This work was authored by the National Renewable Energy Laboratory, operated by Alliance for Sustainable Energy, LLC, for the U.S. Department of Energy (DOE) under Contract No. DE-AC36-08GO28308. This work was supported by the Laboratory Directed Research and Development (LDRD) Program at NREL. The views expressed herein do not necessarily represent the views of the DOE or the U.S. Government. This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications. U.S. Department of Energy (DOE) reports produced after 1991 and a growing number of pre-1991 documents are available free via www.OSTI.gov. Cover Photos by Dennis Schroeder: (clockwise, left to right) NREL 51934, NREL 45897, NREL 42160, NREL 45891, NREL 48097, NREL 46526. NREL prints on paper that contains recycled content. Acknowledgments The authors would like to thank the National Renewable Energy Laboratory’s Laboratory Directed Research Development seed program, which funded this research. Additionally, Bai Cui and Ahmed Zamzam contributed to the initial thinking about technical virtual power plant concepts. Roderick Jackson contributed to our thinking about energy justice concepts, especially linking root causes to current challenges. Nate Blair, Jennifer Daw, Madeline Geocaris, Joyce McLaren, Mike Meshek, Dan Olis, Gian Porro, Mark Ruth, Dani Salyer, and William Tokash provided valuable insights during the editing and review process. This work was inspired by public comments made by the Director of the Department of Energy’s Loan Programs Office, Jigar Shah, and his leadership team. iii This report is available at no cost from the National Renewable Energy Laboratory at www.nrel.gov/publications. List of Acronyms ALA BIPOC CEJST DERs DERMS DOE EJ EJScreen EV FERC FFR IBEW IRA ISO IT JISEA kW kWh LPO MW MWh NECA NREL PHEV PV REV SCE V2G VPP American Lung Association Black, Indigenous, and People of Color Climate and Economic Justice Screening Tool distributed energy resources DER management system US Department of Energy energy justice EPA Environmental Justice Screening Tool electric vehicle Federal Energy Regulatory Commission fast frequency response International Brotherhood of Electrical Workers Inflation Reduction Act Independent System Operator Information technology Joint Institute for Strategic Energy Analysis kilowatts kilowatt-hours Loan Programs Office megawatts megawatt-hours National Electrical Contractors Association National Renewable Energy Laboratory plug-in hybrid electric vehicle photovoltaics Reforming the Energy Vision Southern California Edison vehicle-to-grid virtual power plant iv This report is available at no cost from the National Renewable Energy Laboratory at www.nrel.gov/publications. Executive Summary The Federal Energy Regulatory Commission’s (FERC) Order 2222, issued in September 2020, allows aggregated distributed energy resources (DERs) to participate in wholesale energy markets as a single entity, often referred to as a virtual power plant (VPP). VPPs control dispatchable, aggregated DERs (including flexible, responsive loads), contribute to mul