Skip to content
MarketScale
‹ Back to IndustriesEnergy

States accelerate virtual power plant programs as grid demand climbs

Massachusetts and Minnesota are advancing virtual power plant programs to manage rising grid demand, with Massachusetts targeting 3.5 gigawatts of demand-management resources by 2035 and Minnesota approving utility-owned battery networks. A January 2025 report identified 180 VPP projects nationwide with 19 gigawatts of combined capacity, though definitional gaps remain a challenge for consistent policy implementation.

This story was produced through MarketScale. See how Energy teams put it to work with Customer Stories & Case Studies.

By MarketScale Newsroom · Virtual Power PlantsEnergy StorageGrid ManagementDistributed Energy Resources
Share
Listen to the audio brief

Key facts, context, and what it means.

AUDIO
0:00
States accelerate virtual power plant programs as grid demand climbs

Key takeaways

01

Massachusetts and Minnesota focus on virtual power plants.

02

Virtual power plants help manage rising grid demand.

03

Trend towards broader adoption of virtual power plants in the U.S.

Get featured

Want to get featured in MarketScale Energy?

Create a free MarketScale workspace and get your company's expertise featured across our Energy coverage. No credit card, no demo required.

Start free

Two major policy moves in 2026, an executive order in Massachusetts and a regulatory decision in Minnesota, are drawing attention to virtual power plants as a practical tool for managing electricity grids under growing demand pressure.

What a virtual power plant actually does

A virtual power plant, or VPP, aggregates distributed resources, home and business batteries, factories that can dial back consumption on demand, under a central controller that can dispatch them to supply or reduce load on the grid. With a few commands, hundreds or thousands of nodes behave like a single generating asset, and resource owners receive compensation for their participation.

Industry analysts regard VPPs as a cheaper and cleaner alternative to natural gas peaker plants for meeting short-duration spikes in electricity demand. The concept is gaining traction at a time when grid operators across the country are contending with rising load driven by data centers, electrification of transportation, and industrial growth.

Massachusetts sets an ambitious 2035 target

On March 13, Gov. Maura Healey signed an executive order directing Massachusetts to develop 3.5 gigawatts of demand-management resources by 2035, a category that can include virtual power plants, electric vehicle charging management, energy efficiency, and demand response programs, according to Inside Climate News.

The scale of that target becomes clear with context: the entire six-state New England grid recorded a peak demand of 26.1 gigawatts in 2025, per Inside Climate News. California's VPP network, currently among the largest in the nation, generated a peak of approximately half a gigawatt last July.

The order calls for a September report cataloguing existing demand response and related programs, establishing a baseline before the state works toward the 2035 goal. Autumn Proudlove, managing director for policy and markets at the NC Clean Energy Technology Center at North Carolina State University, noted a broader trend underpinning the action.

We've seen kind of a steady uptick in activity and developing new programs., Autumn Proudlove, managing director for policy and markets, NC Clean Energy Technology Center, North Carolina State University

Larry Chretien, executive director of the Green Energy Consumers Alliance, expressed cautious optimism about the Healey administration's approach of first auditing what already exists.

We're excited. We're always impatient, though. We're hoping this helps kill off some peaker plants., Larry Chretien, executive director, Green Energy Consumers Alliance

Minnesota approves utility-owned battery network, and sparks debate

On May 13, Minnesota utility regulators approved Xcel Energy's Capacity*Connect program, authorizing the deployment of 200 megawatts of neighborhood-scale batteries ranging from 1 to 3 megawatts each, according to Inside Climate News. The program is designed to place storage precisely where Xcel's grid needs it most.

The central controversy is ownership: Xcel, not consumers, would own and operate the batteries. An Xcel spokesperson stated the design is "different in that it is designed to prioritize the larger grid instead of first serving the single customer who owns the battery," adding that utility ownership ensures safe, reliable operation and maximizes benefits across the customer base by storing energy when prices and demand are lower.

Critics are unconvinced. John Farrell, co-director of the Institute for Local Self-Reliance, argued the Minnesota commission chose the wrong ownership model, contending that utility control of battery networks produces weaker cost-containment incentives than decentralized, consumer-owned alternatives.

National VPP capacity: a resource too large to ignore

A January 2025 report from Lawrence Berkeley National Laboratory counted roughly 180 VPP projects across the United States, with a combined potential capacity of 19 gigawatts, close to three-quarters of the New England grid's peak demand, according to Inside Climate News.

U.S. VPP projects by state (top states, Jan. 2025)
Lawrence Berkeley National Laboratory via Inside Climate News · © MarketScaleDownload chart

California led all states with 62 projects, followed by Colorado with 16 and Massachusetts with 15, per the Lawrence Berkeley data cited by Inside Climate News. The geographic spread suggests VPPs are no longer a regional experiment but a growing element of grid strategy nationwide.

Definitional gaps still cloud the sector

One persistent challenge is that the term "virtual power plant" lacks a universally accepted definition, and programs that analysts might classify as VPPs, such as Xcel's Capacity*Connect, are sometimes described without using the label at all. Regulators, utilities, and advocates continue to apply the concept differently depending on ownership structure, resource type, and control architecture.

For grid professionals, the definitional ambiguity matters because it affects how programs are measured, compared, and ultimately counted toward policy targets like Massachusetts' 3.5 GW goal. Clearer standards could help states and utilities benchmark progress against each other as adoption accelerates.

Featured companies

Your experts belong here

Every story in MarketScale Energy starts with a company putting its field engineers, operations leads, and project developers on the record. Buyers are already reading this topic. The only question is whose experts they find.

Developers and operators shortlist on credibility, and your engineers give your sales team something real to send.

Get your team featuredSee how it works15 minutes, straight to a calendar.

About the author

MarketScale Newsroom
MarketScale NewsroomEditorial Team, MarketScale

The MarketScale Newsroom reports on the companies, technologies, and trends shaping 16 B2B industries. It turns primary sources and expert commentary into clear, useful coverage for the people doing the work.

B2B Weekly

The week in Energy, and sixteen other industries, every Monday.

Ten stories, one-line takes, five minutes. Free.

Energy: are you visible to AI?

Before they reach out, Energy buyers ask AI engines which vendors to trust. Explore how your experts, customers, and partners can become useful content for buyers and AI search.

Free plan

You just read one Energy expert. Your company is full of them.

This article was produced through MarketScale. The same platform turns your field engineers, operations leads, and project developers into the articles, video, and social content Energy buyers are searching for. Create a free workspace and see it with your own people. No credit card, no demo required.

NPS +73 · 1,000+ creators · 38+ countries

What you get, free

Your own MarketScale workspace, up to 10 people
One professional video edit a month for qualifying companies
Media requests to your crowd, remote recording, AI writing tools
$0, no credit card, nothing that expires

More Energy Insights

Disconnected data can delay fuel-quality alerts, Titan Cloud says

Disconnected data can delay fuel-quality alerts, Titan Cloud says

This article draws on a Titan Cloud presentation. Its operational examples and product claims reflect the vendor’s account and should not be read as findings from a representative industry survey. Titan Cloud describes a scenario in which disconnected tank, delivery and maintenance records delay recognition of a fuel-quality problem until a customer reports it. The presentation argues that connecting those records can help operators investigate earlier and reduce operational disruption.

  • 01Disconnected data can delay fuel-quality alerts, Titan Cloud says.
  • 02The linked client video is the source for the vendor’s account; its claims are not independent industry benchmarks.
  • 03Operators can request evidence and test the proposed workflow against their own network’s needs before adopting it.

Sep 21, 2026

Titan Cloud describes organized fuel theft across multiple sites

Titan Cloud describes organized fuel theft across multiple sites

This article draws on a Titan Cloud presentation. Its operational examples and product claims reflect the vendor’s account and should not be read as findings from a representative industry survey. Michael Lewis, identified in the presentation as leading Titan Cloud’s international solutions consultancy team, describes coordinated fuel-theft scenarios involving multiple sites. His examples include dispenser manipulation, delivery losses and product adulteration. The scale described is the speaker’s account, not a measured industry-wide rate.

  • 01Titan Cloud describes organized fuel theft across multiple sites.
  • 02The Titan Cloud presentation is the source for the vendor’s account; its claims are not independent industry benchmarks.
  • 03Titan Cloud’s presenters argue that detecting coordinated theft and slow leaks depends on more frequent reconciliation and looking for patterns across the network, rather than ranking sites by raw loss volume.

Sep 21, 2026

Titan Cloud argues maintenance visibility affects EV charger availability

Titan Cloud argues maintenance visibility affects EV charger availability

Titan Cloud reports that CPOs it spoke with at Intercharge want better connections between charger monitoring, ticketing and field repairs. Its conference observations are a vendor perspective, not an industry-wide survey.

  • 01Titan Cloud argues that connecting fault reports with repair outcomes helps operators track whether chargers have returned to service and improve network operations.
  • 02The linked client video is the source for the vendor’s account; its claims are not independent industry benchmarks.
  • 03Operators can request evidence and test the proposed workflow against their own network’s needs before adopting it.

Sep 21, 2026

Explore More Energy Insights

Read more expert perspectives from across Energy.

Browse Energy Hub

About the Expert

MarketScale Newsroom
MarketScale Newsroom

Editorial Team

MarketScale

The MarketScale Newsroom reports on the companies, technologies, and trends shaping 16 B2B industries. It turns primary sources and expert commentary into clear, useful coverage for the people doing the work.

For B2B teams

Your experts could be publishing here

Stories like this one run on content MarketScale captures from real practitioners. See how your team's expertise becomes coverage in Energy and beyond.

Book a 15-minute demo

Or call us. No forms required. We pick up. 214-945-2512