Virtual Power Plant USA

Guide ยท Checked October 2, 2026

The rules behind VPPs: FERC Order 2222, ERCOT's pilot and Texas SB 1699

The federal and Texas rules that let home batteries sell power into wholesale markets, explained in plain English with links to the sources.

FERC Order No. 2222

Issued September 17, 2020, FERC Order No. 2222 lets distributed energy resources, such as rooftop solar, batteries, smart thermostats and EV chargers, take part in regional wholesale electricity markets through aggregations. Grid operators must allow aggregations as small as 100 kW [1].

Each regional grid operator is rolling it out on its own schedule, from California (done as of November 2024) to the Southwest Power Pool (2030). Order 2222 does not apply in most of Texas, because ERCOT is outside FERC's wholesale-market jurisdiction [1].

Texas: ERCOT's ADER pilot

Texas built its own path. ERCOT's Aggregate Distributed Energy Resource (ADER) pilot lets companies bundle small resources like home batteries into one resource that can sell into the wholesale market. In 2023 the first home-battery aggregations joined [2].

The pilot has grown since. In March 2026, ERCOT raised its registered capacity limit to 500 MW [3], and ERCOT reported 249 MW qualified as of August 17, 2026 [4]. A Phase 4 proposal would add more detailed, location-based dispatch of aggregated batteries [4].

Homeowners don't sign up with ERCOT. They join through a participating electricity provider or aggregator. See Texas programs.

Texas SB 1699

Texas Senate Bill 1699 took effect September 1, 2023. It says a company aggregating distributed energy resources doesn't have to register as a power generation company to do so, and lets the Public Utility Commission set rules for aggregators. It also directs the Commission to set residential demand-reduction goals [5].

Illinois: utility VPPs on the way

From June 1, 2026, Ameren Illinois customers who want its battery rebate must enroll in its Scheduled Dispatch VPP, with home batteries discharging on weekdays from 4 to 6 pm, June through September, starting in 2027 [6]. See Illinois programs.

Questions people ask

Does FERC Order 2222 apply in Texas?

Not in the ERCOT region, which covers most of Texas. ERCOT is outside FERC's wholesale-market jurisdiction, so Texas created its own ADER pilot instead.

Can I join ERCOT's ADER pilot directly?

No. Homeowners take part through an electricity provider or aggregator that participates in the pilot.

Sources

  1. FERC, Order No. 2222 explainer
  2. KXAN, Virtual power plants to provide power to ERCOT grid for the first time (2023)
  3. ERCOT Market Notice M-A030226-01 (Mar 2, 2026)
  4. ERCOT, ADER Pilot Phase 4 presentation (Aug 2026)
  5. Texas Legislature, SB 1699 bill analysis (2023)
  6. Ameren Illinois, Renewables bulletin 2026-04

Questions welcome, no obligation

Ask about your home

Tell us where you live and what you're curious about. We'll point you to the programs that fit, and connect you with a program partner only if you choose one below.

  • We answer questions about any program on this site.
  • In Texas, Illinois and California, our partner VirtuGrid can check whether your home fits the SOLRITE home battery program.
  • You'll always see who will contact you before you send.

Do you own or rent your home?

Who will contact you: Virtual Power Plant USA.

We don't sell your information. Fields marked * are required.