Brattle Group study projects $614 billion savings from distributed solar, storage

A new report from The Brattle Group, titled “The national case for a more distributed power grid,” projects that addressing barriers to distributed energy resources could yield $614 billion in savings through 2050. The study was funded by the Pew Charitable Trusts.

Projected Resource Growth

Distributed solar is projected to reach 230 GW, rising from the current 68 GW. This growth implies that one in six single-family homes will have rooftop solar installed by the mid-century. Distributed storage within virtual power plants is expected to scale to 35 GW, up from 1 GW today. Demand flexibility is forecast to grow to 260 GW, compared to 44 GW currently.

Grid Cost Avoidance Strategies

• Automating and streamlining interconnection cuts grid costs by $39 billion through 2050
• Streamlining permitting reduces grid costs by $50 billion through 2050
• Integrating resources into distribution planning saves $177 billion through 2050

Permitting process streamlining could reduce permitting costs by 90%.

Savings Composition and Methodology

Half of the projected savings arise from avoiding the capital and operating costs associated with new generation assets. The remaining third stems from deferring growth-driven upgrades to the distribution system. This shift in infrastructure investment is supported by a 105 GW migration of storage capacity from the transmission grid to the distributed grid, alongside the avoidance of 70 GW in new natural gas generation.

To reach these estimates, The Brattle Group utilized two distinct modeling tools: gridSIM for bulk power analysis and FLEX for distribution-system evaluation. The study notes that specific policies required to achieve the full savings amount were not identified, nor were specific approaches to unlock distributed energy resource benefits modeled.

Background

On 5 November, Luminity highlighted findings from The Brattle Group indicating that the United States possessed 113 gigawatts of distributed energy resources suitable for virtual power plants in 2025. That prior analysis suggested that reaching 524 gigawatts of virtual power plant capacity by midcentury would prevent $614 billion in grid expenditures. It further predicted that average residential electricity bills could decrease by $122 annually by 2050 if such capacity levels were attained.

The identical report observed that if load growth misses forecasts by 5%, U.S. customers would incur $84 billion in overinvestment costs from 2030 to 2040. Scaling up virtual power plant systems could reduce these overbuilding costs by $33 billion, representing a 40% decrease. Maureen Quinlan of the Pew Charitable Trusts commented: "The next step is to build these potential VPP benefits into how utilities plan their grids."

Newer sector trends feature PJM’s recent peak demand hitting 162.6 GW, while projections show data centers and other major loads contributing 30 to 34 GW of additional demand by the early 2030s. Budderfly introduced a $500 million municipal virtual power plant initiative enabling local governments to combine smaller assets.

What to watch

Pew Charitable Trusts says it will continue to share this report with industry, advocates, and policymakers to highlight how distributed energy resources can benefit customers and our energy system.