Hot Texas summers continue to push peak demand for electricity to new heights as the population and economy grows, more data centers are built and EV adoption increases. The state’s monthly energy demand is expected to roughly double by 2030, according to the state’s grid operator ERCOT.

To make sure supply keeps up, investment is going into new generation; costly and time-consuming projects like building natural gas and solar plants. But energy companies are also reaching under the couch cushions for every electron they can get in a new strategy that focuses on pooling at-home energy resources.

On a recent tour of what Texas energy company NRG calls their “Smart Home” — a two-story house in Houston’s trendy Heights neighborhood — the company showed off the latest tech it uses to make the most of every kilowatt, from fancy toasters to smart thermostats.

On the second floor, in this test home’s garage, a large screen with a moving graph showed the entire home’s energy consumption in real time.

After plugging in an EV, energy consumption doubles in the home. Then when the EV charging stops and the AC turns off, the graph plummets.

“Your consumption, it's pretty much air conditioning,” said Mark Parsons, Texas head of consumer energy for NRG.

Which is why setting people up with free smart thermostats is one key to NRG’s virtual power plant. It’s a program developed to balance energy supply and demand by tweaking energy usage in hundreds of thousands of homes.

“Instead of doing everything at two o'clock in Houston, when it's 100 degrees outside, charge your car later, cool your house before that, cool your house after that,” Parsons said.

Those tweaks add up.

“If you had 650,000 thermostats acting together,” he said, “that's a middle-of-the-road power plant.”

A power plant you might not have to build. Instead, you get that virtual power plant.

The company aims to have 1GW of electricity capacity through its virtual power plant initiative by 2035. Currently, roughly 150,000 NRG customers have virtual power plant-enabled devices, according to a company spokesperson.

While demand-side programs focused on curtailing customer power usage have been used for decades in different parts of the country, what’s different with virtual power plants is the sophistication of these programs.

They use machine learning with smart thermostats in your house so it automatically pre-cools, according to Doug Lewin, a renewable energy consultant and author of Texas Energy and Power newsletter.

“Think of like you always want your house to be 75, you don't want to go above 75… in the summertime, you wouldn't necessarily care if it's 72 inside your house sometimes,” he said.

Pre-cooling your house when the sun is high saves you, the customer, money — and lessens strain on the grid because solar energy is cheaper and is only abundant in the daytime. These virtual power plants are monitoring prices and the weather and learning consumer patterns to a level a residential customer wouldn’t.

“No human has to take any action. Your comfort is maintained, and you get a payment as a customer,” he said.

And there are also programs like this on the supply side, using residential batteries that can be pooled together.

When she worked for Tesla after the 2021 winter storm that caused massive outages in Texas, Arushi Sharma Frank helped create a pilot program so people who buy home batteries could get paid for the small amounts of electricity they send back into the grid.

“We have to squeeze out juice from everything we can,” said Sharma Frank, who is now principal at her own consulting firm Luminary Strategies. “We need to allow customers who invest in insurance policies wherever they can, to make a return on their investment.”

Though these kinds of programs are growing in popularity, a big question remains, according to Doug Lewin: how customers will be compensated.

“What you're adding to the grid is very valuable,” he said. “What you're actually removing in demand also has a value and actually ascribing that value and then literally paying the customer for it, that is a difficult thing to work out the details on.”

Still, he said “it’s a pretty big shift” that a large energy company like NRG has rolled out a virtual power plant in Texas.