Episode 29 Transcript: Building a Community Pool (of Electrified Houses)

Molly Wood Voice-Over:

Welcome to Everybody in the Pool, the podcast for the climate economy. We dive deep into the climate crisis and come up with solutions. I'm Molly Wood.

Now … we’ve talked a little bit about solar on the show … and batteries for storing power to regulate the grid and ensure reliable access …

Today I want to dig into that a little bit more … with a twofer … a company that provides solar and battery backup … that works WITH … a company that builds new homes and housing developments that can be customized to be fully net zero … and all electric …

It’s a story of how … after working together for over a decade … these two companies thought ok … what if we made a whole TOWN … that was fully electric … generated its own power … had its own giant community battery … and every house could be controlled with a micro-grid that would either give or take power depending on when they needed it the most?

AND SO THEY DID …

Let’s get into it … today on the program … we have Dan Bridleman Bridleman … who runs sustainability at KB Home … which is a publicly traded home-building company …

And Matt Brost … who’s head of the New Homes Division at SunPower.

The two of them have worked together for 12 years … to put solar and batteries on new homes … and prove that it works.

Dan Bridleman: 

early on in our relationship, um, we partnered with Martha Stewart.  And we built a demonstration home in Florida with Martha and we told Martha that, you know what she does great at the time was  she was an icon of, you know, just you go to her to get what something should look like. But we also told her is that

Molly Wood:

is, she is an icon.  Present tense, Dan Bridleman

Dan Bridleman: Present tense. Sorry, I didn't mean to use was she still is  an icon and, um, but we also said we could do something.  Different too, Martha. We could also make this home net zero before anybody even knew what Net Zero was. So 15 years ago,  our project with with Martha was to demonstrate that we could actually, with the technologies that long ago,  a beautiful home and make a net zero.

So this relationship goes back to  demonstrating things. So sometimes people think it's just, you just did it this year.  is an eVoice-Overice-Overlution of  Of technology that has come along over a long term, a long period of time. So, um, it goes back to, uh, back to then.

Molly Wood: 

So  for those who maybe are a little less familiar with how  this process works, you know, Matt, you made this comment about it's one home at a time as opposed to a hundred homes at a time. But  what are the, what is the, before we talk about this kind of cool specific microgrid resilience project,  what is the level of like, are you  building developments at a time.  One house at a time. Some coMatt Brostination of both.

Matt Brost: 

Yeah. Um,  so we started, uh, at SunPower focusing on just home builders in 2005, and the funny story is in 2005, most home builders actually thought when you talked about solar, it was those things that leaked on the roof.  Uh, and so we were overcoming quite a bit just to get, um, uh, really builders to understand what the technology was.

But  we, it was more than about just solar technology. It was about building a better home. It was like adding in high levels of energy, energy efficiency, sustainability. CoMatt Brostining that with solar and actually redefining the overall.

The way that you scale this is not by doing one home at a time. It's you get, uh, builders like KB home to make commitments to do, uh, entire subdivisions at once. And in doing so, it's a very complicated, uh, process. There's a, a lot of design and engineering and integration with the builders, uh, development of their plans and their homes and ensuring that the systems are gonna.

Coordinate well with all of the other trade partners that are on the job site, um, and that ultimately you deliver a system.  It's cost effective. That's on time on the builder's schedule. And when the homeowner moves in, we have an excellent experience with it. So you really have to nail all of those along the way.

And what is wonderful about, you know, the home builders that we work with is we can do this at scale.  And doing this at scale allows us to bring on more trade partners, more labor. Uh, bring more consumer awareness because, you know, early on people were out looking for a new home. They weren't necessarily looking for solar.

You know, a lot of people with existing homes might be looking for solar, but they're getting a new home with solar. So there's also a huge educational component because  they're educating themselves on a lot of different things when it comes to buying a new home and decisions  happening. When you're moving, uh, we had to make that, um,  seamless for the homeowner.

We had to show them the benefits, show the builder the benefits, and over time we were able to really be, I think, successful at doing all of those things.

Molly Wood: 

(THIS MAY NEED A RETRACK) And,  and then just to clarify, you've always been  a sustainable home builder, or that's always been built into, no pun intended, the options that consumers can choose from.  Okay.

Dan Bridleman: 

Exactly. I mean, we'll put a lot of, you know, first of all, every home, regardless of the options you pick, Molly, every one of our homes gets certified  and, um, it's designed for  Star. So third party certification,  we generate a hers score. Every home gets a hers score and we even in our models, you walk into one of our models, it'll tell you this home's energy usage for the year is expected to be this and its score is this.

So that's what you could expect when you buy this house and that's built into every base.  Then you can  In California, there's a requirement for solar. Every home needs a certain amount of solar, but you can also add more to it if you want to, or you can add solar to a home in, say, Arizona if you want to.

So, um, you know, it's, it's your ability to be able to pick and choose that to make it, uh, you know, the house that you want of your dreams.

Molly Wood: 

Yeah.

Matt Brost: 

And, and if I might just add, I think, I think we are at an inflection point. You mentioned Molly, the consumer.  Um, you know, 17 years ago the consumer wasn't, um, wasn't necessarily looking for these products.  We have definitely seen a change in the interest, the demand, um, the pride that comes now with owning, you know, a home that comes with a SunPower system on it or, or a battery installed and, you know, ready for an EV charger or smart home technologies.

The consumer is much more educated around these things now than they were before, and, and that's really exciting because Trump, quite frankly, that one of the biggest barriers.

Consumer education.  And  the other thing that we were able to do, and we'll talk about this with, you know, connected communities, is  um, if you ask the average person what is it that you look for from their utility, the average person's gonna tell you, well, I would like low cost electricity  or cheap, and I would like it to be reliable.

What we've been able to do with KB and our home building partners is.  Make energy  less expensive than the utility, make energy more reliable than the utility, and really important is make it more sustainable than the utility. So you hit all three of these things. Uh, affordability being nuMatt Broster one. We don't impact  KB homes  construction costs, so they are able to maintain affordability.

We lower the electricity cost of the consumer and we do it with a great.  Technology from the sun, which is great for our planet, right? So there's, and the consumer, I believe, is actually picking up on all of those things now and realizing this inflection point is here, not just on that, but just the inflection on the technologies that are going into homes are really changing today.

Molly Wood Voice-Over: 

But solar … as you know … is increasingly only half the battle … especially because some big solar energy markets … like California … are changing the way they pay consumers back for generating renewable energy … this is something called net metering.

Dan Bridleman: 

typically, and I'm gonna say almost in every single case, not every case, but um, if you live in a community and you put solar on your roof and you  generate power,  none of that power goes into your house.  That power is a power plant on your roof, and it goes into the grid.  There's a separate meter on your house that measures how much electricity you're producing.  The house is continually always taking power from the grid, never from your solar panels. And then at the end of the month,  you get a credit back from the, from the utility companies typically on this is how much you generated and this is how much you use.

So then you're only paying for the net amount, but the power you produce.  Um, doesn't go directly into your house, so, and you get credit for it. And it's been that way for a very, very long time. And so,  um,  and rules are changing in terms of like, how much credit do you actually get for what you generate into the grid.  So as we move into the next eVoice-Overice-Overlution of a micro grid or something else,  batteries and your ability to use that power in your house become a fundamental.  Innovation that provides you with, you know, I'm gonna say  geometric opportunities to use your own power.

Molly Wood Voice-Over: 

In California, new rules went into effect this year that reduce the rate that utilities credit you for solar power … by 75%. That’s controversial for a lot of reasons … not least of which that it takes way longer to break even on an expensive solar installation … potentially reducing demand … it also makes a REAL strong case for whole home batteries.

Matt Brost: 

So in comes the battery, and the battery is a, an excellent piece of equipment and you can, you can, for the time being, ignore the idea of battery as providing backup in.  Think of just a battery by itself that's storing that energy that would otherwise go to the grid at low export rates, uh, and instead store it and hold it, self, consume it by whatever you're using in your home, and then discharge it in the evening period.

In the evening period.  Uh, we have very high peak rates. This is when everyone comes home and turns on air conditioners and begins to cook, and water heaters come on, and that sort of thing. So the utilities experience a, a significant peak in demand. And, uh, that is also when they want to charge more for electricity.

So if we can store energy and discharge it at a time when the utilities need it the most, it provides significant value to the utility. Um.  A part of this, a piece of this is exactly what, you know, connected communities is all about,  but we take it one step further with the battery, which also provides resiliency to the home.

So the homeowner has essential circuits in their home that will be powered in the event of, uh, a power outage or a public service power shutdown, as they call them in California, often caused by wildfires, but may also be caused by.  Storm conditions or, or, or, or other, you know, unexplained events.

Molly Wood Voice-Over: 

Time for a quick break. When we come back … how this coMatt Brostination … of changing economics around solar energy … the need AND the benefits of battery storage … and the need for entire communities to be more resilient … led to a bold experiment … in southern California.

Molly Wood Voice-Over: 

Welcome back to Everybody in the Pool. We’re talking with Matt Brost of Sunpower and Dan Bridleman Bridleman of KB Home … about building entire communities of new homes … making their own renewable energy … and keeping the lights on themselves. My little prepper heart is growing three sizes …

Molly Wood: 

Power availability is something that I think a lot of Americans have taken for granted for a long time, and, and it is not as reliably available as it used to be.

And so there are sort of a lot of reasons to be exploring this paradigm of solar plus storage and resiliency. So let's talk about this project that the two of you  are working on together, um, and connected communities and what that means.

Dan Bridleman: 

You know, in California, um,  we went through a terrible drought and, um, there were a lot of times where a wildfire,  uh, affected a huge community.

And then power companies will shut down power because they don't want sparks, they don't want to create things. So you could be in a community without power,  um, because of a big wildfire, because of a huge windstorm. And there's Cases where that happens here in California besides just, just use of power. So,  um, you take a coMatt Brostination of all these factors and with all the technology we have,  um,  build a resilient community that, um, if you think about how power can come into your house, power can come into your house from a solar panel on the roof.  Power could come into your house from the grid.  Power could come into your house from a battery.  And power could maybe come into your house from  a community battery  and all these batteries can be,  you know, refreshed by the sun during the day and be used at night.  So  we had an idea about, uh, just before Covid hit,  um,  I have a partner, Jacob Atala, who's sort of iconic  in this world for with me and with, uh, the whole solar process. And  we thought  Why couldn't we build, um, with what we know about  our 20 years of history, of building,  um, I'm gonna say great envelopes, and we've got our houses down where they use very little power.  So all electric communities that could  be resilient. So  we,  we, did what, what I'd say is one of those brainstorming sessions with some really big partners.

we, we thought we would partner with the US Department of Energy with SunPower. Matt's on the phone  while I'm with the University of California Irvine, um, and also the power company. Say, Hey.  What if we got together and  identified a community at KB Home that we could do this in  and, um, all work together on a, on a technology where we could actually apply for a grant with the federal government and, and see if you could make a large scale connected community work.  It's gotta be warranted. It's gotta last for 25 years. It's gotta be simple. It's gotta be easy to use.  And um,  you know, how do we do this?  Lower that energy usage and give people resiliency. So we probably spent,  Matt, I'm gonna let you jump in here so I'm not just occupying this whole thing, but we probably spent a good two years,  Molly, think, tanking this, thinking through it, talking about the risks, talking about the profile.

Matt Brost:

Yeah, we, we, the think tank is right. Uh, and I will say that it was years in coming together and we had actually put together a project plan before there was a Department of Energy opportunity.  Uh, that's how forward thinking I think the group was. We felt there would be opportunities to apply for,  and it turned out that there was, we were lucky enough to win, uh, one of 10.

DOE grants, uh,  six plus million dollars. Uh, a lot are in the majority of that money really going towards the microgrid concept of the project. //

But the idea,  uh, behind it was resiliency. As Dan Bridleman said, I. That was gonna be sort of a core theme here. It was a core theme of, of the Department of Energy.

Um, but it was doing, you know, there are things we're doing in this project that are commercially available today, and we will continue to replicate them. But when you start talking about instituting a  micro grid  that is connected to the utility.  That is actually separated by two different subdivisions.

So you've got over 200 homes with two subdivisions that can be isolated independently.  You've got a large community battery storage system that's going to be co-locate located on the project, which will.  Provide resiliency to the homes, but we'll also provide the ability to discharge to the grid at peak power times.

So it serves two purposes.  The controllability of this microgrid, the cybersecurity associated with running a microgrid and having a microgrid.  All of these complexities, you know, um, it took a very sharp, bright and committed team to, to develop and continue to develop.  Um,  uh,  I particularly like that KB started with the Great Home.

Every single one of these homes is all electric. Every single one of these homes is built to the Department of Energy's net zero energy standards. Every single one is designed to have a solar system to offset a hundred percent of the expected consumption of that home.  Every home have, it has its own battery system, SunPower battery in the garage that will back up loads in that home.

Every home also has smart, connected devices like thermostats and water heaters, um,  EV chargers that can be remotely controlled to manage the load in the communities. And then all of the homes have access to a community battery.  Um,  and then  the other thing that, that's sort of, uh.  I wouldn't even say novel.

I, I would say, is a growing,  um,  uh, area.  In, in this segment of energy services is where  customers can opt in to participate in demand response so they can get paid to discharge their battery, to have their thermostat controlled. Or have their EV charger, uh, you know, turned off at a time when the utility needs power and they can actually earn rewards and money for doing that.

We call that virtual power plant. Um, in all of these customers, it turns out, are happy to enroll in the virtual power plant program. So the benefits to the homeowner from savings, the benefits to the grid. And grid services  is, um, you know, it, it's almost like everyone in the project is benefiting from the results.

Now,  I'll just say  a lot of this is, is working and working really well. The microgrid component and the community battery will be installed later next year. We have a lot of research to do yet. To understand how the microgrid works with the homes, what went well, what we need to work on to improve. But we do believe that this is, um, setting the blueprint of the future  of microgrid communities and to have a utility like Southern California.

Edison, one of the largest investor-owned utilities in the nation,  actively inVoice-Overice-Overlved in this project.  Um, is, um, is, is is significant in terms of I think, scalability and commercialization.

Molly Wood Voice-Over: 

This energy-resilient planned community is in Menifee, California … in Riverside County … kind of in between San Diego and Los Angeles. It’s made up of more than 200 homes which … as Matt mentioned … are all electric … super energy efficient … and basically generate as much solar energy as they consume … they’re net zero … and IF they need more power … they will be able to get it from the community battery.

The development itself is called Shadow Mountain … the two communities in it are called Durango and Oak Shade … houses start at around 520 thousand dollars …

And as Matt said … the Department of Energy put a 6 and a half million dollar grant into the Shadow Mountain project because everyone hopes … this will be the blueprint … for how to build more resilient … clean energy generating … towns and communities EVERYWHERE … once it’s completely finished.

Molly Wood: 

Matt, tell me more about those next steps. So the, the, like you said, the houses exist and are wonderful and are being built and sold. And then the next step in terms of really realizing this holistic vision  of this resilient, decentralized  power producing community is this microgrid. Tell me a little more about, you know, for people who are not familiar with that concept.  What does that mean in practice to build.

Matt Brost:

Yeah. Um, so think about it this way. Each of the two communities, Oak Shade and Durango  are um.  Each have underground wiring, if you will, that allows them to be controlled independently from the grid. So there's an inter, there's a switch at the grid where we can literally shut the grid down and island  the community or the communities  together or by themselves.

So imagine in a blackout, um, all of those homes have their lights on while all of the other neighboring communities don't because they have battery systems and solar systems and community batteries. Um, so the next steps are,  remeMatt Broster with a battery in the home, we can power certain loads in the home.

When we install the large community battery towards the end of next year, it's going to supplement the amount of energy that a homeowner can use, so it will be additive to what they can use, and we will be able to monitor how much these homes can draw off of the community battery.  While we're doing this, we're gonna be running a nuMatt Broster of different tests, and this is where.

Um, uh, university of California Irvine has come in, um, the great people in that department helping us determine.  Uh, what sort of tests and how many tests we will do. We will actually, and the homeowners have agreed to this, do power shutdowns. We will control devices in the homes. We have the ability to turn on and our off large relays.

So think about EV chargers or  um,  uh, HVAC systems, that sort of thing. We can.  Control those loads so that we can manage  the microgrid. The idea is to have the microgrid say self-sustaining for days on end. And the only way you can do that is if you manage the available power. The next day the sun will come up, it will recharge the batteries to some degree, and you're always trying to manage that community such that it can be  re retain its resiliency.

So those are some of the main things that we're gonna be testing. We're also going to be surveying the customers just on their experience in the community, their experience during these test events. Um,  and obviously the utility will be heavily inVoice-Overice-Overlved in this as well as a partner to also see  how they benefit from  receiving load from the community during.

Uh, you know, peak grid periods where they're needing the community to provide power back to them.

So I, um, and the, the last thing is, we haven't touched on this too much, is we also have a partnership with Kia, uh, where we are doing, uh, vehicle to home.  Uh, charging. So,  uh, we have a new, uh, v um, uh, bidirectional EV charger that we're using and we're putting in it in 10 homes.

Uh, there will be, uh, uh, a fleet of Kia EVs there, which will be also supplemental, which are, uh, are enhancing the testing that we're doing because if you followed technology, I think everybody probably knows that.  Uh, you know,  not only is ev you know, the nuMatt Broster of consumers owning an growing rapidly,  but the ability to now supplement homes with, uh, the EV as an additional, uh, source, uh,  is  going to become more, uh,  um,  uh, much more available, I think with new technology coming out in the future.

So that's another part of the evaluation of the project.

Molly Wood: 

I am obsessed with bi-directional charging, and I wanna move to Menifee immediately. Um,

Yeah.

talk quickly before I move to the kind of the high level goals.  Talk about how  Big a deal, it is to get a utility  onboard because the utilities, I think, you know, we can say, have had  across the country, certainly  varied  interest in

helping consumers with this kind of power generation. Um, and, and yet, and, and this is a, this is decentralization.  Like it's a, it's could, there are utilities across the country who could see this as a threat to their operations. And you got one on board and that feels like a really big deal to me.

Matt Brost: 

Well, I think that  just having a relationship with, um, California Edison and being a, a great partner of, of with them has helped us to go through this. I mean, I think they wanna learn as well.  How they participate in this. So I think it's a great,  open-ended experience for them. And they're in this one with us. I, I, I think that partnership allowed us to be able to do this in a very safe way for them because we're sharing data with them. And so, um, you know, to me it wasn't very difficult 'cause we didn't,  it was a do you wanna partner with us and do this test? So I thought it was fairly easy for us to do that utility  regardless of maybe what this might mean in the future.

But for this particular Project that was, you know, pretty easy. Um, so  without partnering with the utility, this would be difficult.

Molly Wood: 

because utilities have said this is our death spiral scenario, right? You're generating all your own power and you're only using your own power. But it's that  give back to the grid. That is the reason they want to sign on. that they then can receive power from this microgrid and from that storage when they need it most, because it ensures their reliability throughout the region Also.

Matt Brost: 

This help, this helps them aVoice-Overice-Overid additional generation assets, right? And so to the extent we can bring virtual power plants to them, we can build projects like this that help them in the peak. And so to aVoice-Overice-Overid building just a single peak power plant, you know,  probably not a carbon neutral peak power plant either.

Uh.  And that's why you come back to the utility. I think there was a lot of alignment with SCE and the forward thinking in terms of decarbonization, electrification, peak power requirements. You think about the impact EVs are going to be having on the grid, right? That, that the demand for for for energy is, is just in particular, electric energy is rising rapidly.

And, um, so yeah, I think, I think they saw great alignment in this project and how this could potentially be part of what the, the solution set that they deploy in the future to address,  you know, all.

Molly Wood: 

that feels like, that feels like the big unlock to me, the idea that a community of homes  is not just a taker,  it's a generator of the power that they so desperately need.

Dan Bridleman: And you know, uh, Molly too. I think that if you're a utility company, and I can't speak for them, but.  You know, the, the ability for, um,  renovation of what you provide. I mean, if you, you can look back in history of companies that failed to try to be part of the innovation stream.

Like,  um, you know, uh, I use a couple of names and I don't, I don't mean to do this in a negative way, but I think I. Blockbuster never thought that, you know, Netflix could real time stream and, and, and they didn't want to reinvent and they lost that business model. Or, you know, what happened with photos in the cloud and with everything.

So,  you know, if you, if you don't continue reinvent your business model and look for other ways as sources of incomes and it can fail. And I think that's why this is interesting for  The community's like, we are putting a, a grid, a power grid in this community, but did that power grid have to be ours?

Could it have been somebody else's?  just demonstrating opportunities for the future and, um,  uh, in, in a very safe, safe way. And so I think there could be lots of opportunities for revenue streams based on these kinds of concepts throughout the country. And, um, it, it, it'll be interesting as we go into the future.  You know, if, if you're a young person today,  the future of all electricity and, and using  and using solar is, is phenomenal. I mean, it, it should be so much, um, so much brighter and better and, and, uh, I'm really looking forward to just seeing this innovation just get bigger and bigger and bigger. So I feel good about where I feel good about where the future is actually.

Molly Wood Voice-Over:

I know sometimes it can be daunting to think oh all we have to do is design entire towns differently and build millions of new houses that are their OWN grid, no big deal …

but … and thank you for bearing with me … I just find this all fascinating how the economics continue to eVoice-Overice-Overlve and we figure out that oh solar is great but we also need batteries and wait what if we got the utilities to stop fighting solar by saying HEY here’s some FREE ENERGY FROM THE SUN to help you keep the power on wouldn’t you like to pay for THAT … and your car is charging your house and it’s all so cool and it DOES give me hope and a drop becomes a flood and this is how we get there. The boring hard work … all happening somewhere all at the same time.

Ok I know, enough enough … that's it for this episode of Everybody in the Pool. Thank you so much for listening.

This will be the last REGULAR episode of the year … I will have a little bonus episode for you next week and then I will see you back here in the feed in mid-January …

I hope you all have amazing holidays … happy Hannukah to my friends and family who are celebrating now … and happy New Year … in advance.

Please email me your thoughts and suggestions to in at everybody in the pool dot com and find all the latest episodes and more at everybody in the pool dot com, the website. And if you want to become a subscriber and get an ad free version of the show, hit the link in the description in your podcast app of choice.

Thank you to those of you who already have. See you next week.