In this episode, Rachel Permut draws on decades of experience in distributed energy and virtual power plants to explain how demand-side flexibility is becoming a critical grid resource. She breaks down what DERs and VPPs are, why customer enrollment and revenue mechanics matter more than the “shiny” technology, and how fragmented U.S. markets create both complexity and opportunity, with DR payments now reaching up to $100/kW in some regions. Rachel dives into the evolving role of data centers, including flexible AI and batch workloads, water-based cooling trade-offs, and emerging models where data centers pay others on their circuit to reduce load. She outlines the full demand response lifecycle from contract and enrollment through dispatch, baseline measurement, and payment, highlighting where programs typically fail and how better communication, software, and market design can unlock more value. Ultimately, she argues that DERs and VPPs are not a silver bullet but are fast, cost-effective tools that must play a much larger role alongside new generation to address growing grid stress.

Highlights from their conversation include:

• Meet Rachel Permut And Her Energy Industry Background (0:29)
• Why Rachel Focused On Demand-Side Energy And Flexible Load (1:28)
• What DERs Are And How Virtual Power Plants Work (3:23)
• How Much Flexible Load Is Worth Across Different US Markets (7:08)
• Role Of Aggregators And Market Selection For Industrial Operators (9:37)
• Data Centers As Flexible Load And Deferrable Compute Workloads (11:06)
• Where Demand Response Programs Fail and Opportunities For Startups (16:44)
• Measurement, Verification, and Baselines For Load Curtailment (20:25)
• Why DERs and VPPs Should Be A Bigger Part Of Grid Solutions (22:40)
• Policy, Market Design, and Local Capacity Value (24:16)
• ERCOT, PJM, and How Markets Are Evolving For Flexibility (26:35)
• How Industrial Operators Should Approach Aggregators (27:52)
• Closing Thoughts Episode Wrap-Up (28:38)

Dynamo Ventures is a venture firm backing founders upgrading the physical economy. As intelligence moves into critical infrastructure and technology collides with physics, industry is entering a new era of transformation - the industrial renaissance.

Born from the dirt and grit of supply chains and shaped by operations, not spreadsheets, Dynamo focuses on the complex realities of building in the real world. We invest in companies transforming infrastructure, manufacturing, logistics, transportation, and the systems that power global commerce.

Dynamo works closely with founders who combine ambition with a bias to action, bringing a builder mindset to venture capital through deep operational insight, systematic pressure-testing and hands-on partnership.

Our purpose is simple: to back the relentless shaping the industrial renaissance. Learn more at www.dynamo.vc. 

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