This Startup Turns Electric Water Heaters into Grid Batteries

Shifted Energy is tapping water heaters in lower-income communities to create virtual power plants that help balance the grid, starting in Hawaii.

Posted March 7, 2023

Forest Frizzell, CEO of Shifted Energy, wants to make sure that the rewards from helping his home state of Hawaii move to 100 percent carbon-free electricity don’t just belong to the lucky few who can afford rooftop solar systems and home batteries.

That’s why his startup has built one of the country’s most advanced virtual power plants on a ubiquitous piece of Hawaiian household technology — electric water heaters.

As of last year, Shifted Energy had equipped more than 3,000 households in multifamily condos and apartment buildings on the islands of Oahu and Maui with its cellular-connected smart-water-heater control modules. Those families earn about $3 a month in utility bill credits for allowing Shifted Energy to turn those water heaters on and off to help balance the grid during sudden shifts in wind and solar power supply. This virtual power plant (VPP) offers the utility a collective capacity of up to 2.5 megawatts of fast-responding grid support.

Shifted Energy’s algorithms predict down to the kilowatt-hour just how much electricity each family needs to provide hot water at different hours of the day, giving utility Hawaiian Electric a resource that’s as reliable as a power plant in terms of flexibility and control. And, unlike a power plant, Shifted Energy can also remotely program water heaters to absorb excess solar power when more is being generated than the grid can handle.

The VPP is part of Hawaiian Electric’s Power Partnerships Program, a groundbreaking approach to enlisting customers to help balance island grids that are mandated by state law to run completely on renewable energy by 2045. Other VPPs from solar-plus-battery aggregators Swell and Sunrun are also participating in this program, but Shifted Energy’s water-heater fleet has been providing its second-by-second capabilities at full capacity for more than a year as those solar-battery projects have just been getting up to speed.

“We’re more than a water-heater company,” Frizzell emphasized. The same algorithms that Shifted Energy has applied to electric water heaters can be applied to home batteries, electric-vehicle chargers and other household appliances.

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