As hyperscalers pour billions of dollars into new power plants for data centers, Google is also investing in something different: making better use of the existing grid.

The tech giant announced a new deal today for a gigawatt-sized virtual power plant (VPP), which appears to be the largest deal of its kind from a hyperscaler. The approach shrinks overall power demand at key moments. Voltus, Google’s partner, pays businesses and homeowners to use less electricity at times of day when the grid is under strain. A big box store might automatically adjust its thermostat by a couple of degrees; a factory might temporarily run part of its production on a battery. At a house, the electric vehicle in the garage might adjust its charging schedule.

In many cases, the changes might not even be noticeable. But in aggregate, they can provide a major source of new capacity—and that can happen faster and more affordably than building new power infrastructure.

“Virtual power plants are the clean, firm resource that we have available today,” says Ellen Zuckerman, head of energy market development for North and South America at Google. “So this is really our way to assist the grid, especially one like PJM, which is facing capacity shortages.” It has another critical benefit, she says: It can help bring down costs for everyone on the grid.

The company is racing to deploy a range of solutions, from state-of-the-art geothermal technology to new types of long-duration batteries . But virtual power plants are an important part of the picture.

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