A new Tesla Virtual Power Plant (VPP) in Puerto Rico will offer significant advantages to the territory’s Powerwall owners. The VPP will help support Puerto Rico’s power grid while compensating homeowners who participate in the program.

A VPP aggregates renewable energy produced by program participants. It then sends electricity to customers on an as-needed basis.

VPPs help to align electricity supply and demand to maintain a stable system. Without VPPs, customers’ electricity expenses can surge during peak demand hours. A 2020 study from New York City found that electricity can cost up to 1,300% more than average during peak demand times.

In addition to keeping bills down, VPPs reduce the risk of power outages.

According to Teslarati, the Puerto Rico VPP is likely to become the biggest VPP in the world. There are approximately 74,000 Powerwall owners in Puerto Rico who are eligible to join.

Tesla VPPs in other regions have already brought significant benefits to Powerwall customers. In 2017, Tesla set up a VPP in Vermont in collaboration with Green Mountain Power. The VPP has cut customers’ power bills by 18% compared to the regional average.

How the Puerto Rico VPP will work

Participants in the Puerto Rico VPP will receive compensation of $1 per kWh sent to the grid. The average US residential solar system generates between 750 and 850 kWh per year. Therefore, Puerto Rico Powerwall customers who join the VPP can cut their energy expenses by up to $850 per year.

Powerwall owners can also set their Powerwall’s VPP Backup Reserve to choose the level of their contribution to the program. This allows participants to confidently have a backup energy supply.

The Puerto Rico VPP program is open to Tesla Powerwall owners who have a residential customer service account registered in LUMA’s Net Energy Metering program. It’s also available to Powerwall customers who don’t have an account simultaneously enrolled with another aggregator.

Powerwall owners must log in to Tesla’s mobile app to sign up for the VPP program. VPP participants will be paid once every three months.