This bill mandates the Board of Public Utilities (BPU) to create a virtual power plant program aimed at reducing peak electric energy demand and enhancing grid reliability. Virtual power plants, defined as aggregations of distributed energy resources (DERs) such as residential solar systems and energy storage, will be coordinated to provide various grid services. The program is designed to achieve a peak demand reduction target of 500 megawatts by 2030, while also increasing resource adequacy and minimizing the need for costly infrastructure upgrades. The BPU is tasked with establishing minimum requirements for the program, which will be implemented by electric public utilities.

Additionally, the bill stipulates that any direct control over customers' electricity usage or storage must be managed by third-party DER aggregators, ensuring that electric utilities do not directly control these systems. Each electric public utility is required to submit an implementation and reporting plan to the BPU, along with annual reports to demonstrate compliance with the program's requirements. The BPU will review these plans for cost-effectiveness and ensure that the program results in savings for ratepayers, while also considering the inclusion of low- and moderate-income customers and those in overburdened communities.