Thermal energy storage just stepped into CAISO’s wholesale market. Here’s how IceBrick turns building cooling loads into flexible, profitable green energy assets.
Most commercial buildings spend 30–40% of their electricity bill on cooling. In hot states like California, that cooling load also drives some of the dirtiest, most expensive hours on the grid. That’s exactly where Nostromo’s IceBrick thermal energy storage system just made a quietly historic move.
For the first time, a behind-the-meter thermal energy storage system is participating directly in the CAISO wholesale market. Not as a side note to batteries. As a standalone, dispatchable resource. That’s a big deal for anyone serious about green technology, smart buildings, and cost-effective decarbonisation.
This matters because it shows a different path to scaling clean energy: instead of only adding more generation and more lithium-ion batteries, we can turn existing cooling loads into flexible, grid-interactive assets. And with AI and smart controls, this becomes an orchestrated, profitable part of a company’s energy strategy.
In this post, I’ll break down what’s actually happening at the Beverly Hilton and Waldorf Astoria, why thermal energy storage deserves more attention than it gets, and how building owners, data centres, and energy managers can turn this trend into a real advantage.
What Nostromo’s IceBrick Just Proved in California
Nostromo’s IceBrick system at the Beverly Hilton (also serving the neighbouring Waldorf Astoria) has crossed a threshold: it’s participating in the CAISO wholesale market as a dispatchable demand response resource via integration partner Olivine.
Here’s the core achievement:
- IceBrick charges by making ice during off-peak hours when electricity is cheaper and cleaner.
- During peak hours, it uses that stored “cold” to handle part of the building’s cooling, so the chillers can ramp down.
- Through Olivine’s
ClimateResponseDER platform, this behaviour is no longer just smart building operation – it’s a tradable grid service.
Over the summer, the system joined California’s Demand Side Grid Support (DSGS) program and delivered more than 200 kW of load reduction during events. That’s real capacity, delivered from a hotel roof rather than a gas peaker plant.
Even after California cut DSGS funding in September 2025, Nostromo and Olivine kept pushing: now, IceBrick is active in CAISO’s wholesale market, proving that thermal storage can:
- Operate as a standalone market resource, not just an add-on
- Deliver predictable, dispatchable load reductions
- Monetise its flexibility through existing market rules
For the Green Technology series, this is a textbook example of how intelligent demand-side resources sit alongside solar, wind and batteries as core climate solutions.
How Thermal Energy Storage Actually Works (And Why It’s Smart)
Thermal energy storage sounds exotic, but the concept is simple: store energy as heat or cold instead of electricity. IceBrick focuses on cold storage, which is ideal for buildings and data centres.
The IceBrick model in plain terms
IceBrick is a modular, behind-the-meter energy storage system that:
- Charges: During off-peak hours, electric chillers run to freeze water inside IceBrick modules.
- Stores: That ice holds a large amount of thermal energy (latent heat) in a compact space.
- Discharges: During peak hours, the system circulates water past the ice to cool it, then feeds that chilled water into the building’s air conditioning loop.
The result: the cooling demand seen by the grid drops sharply when it matters most, without sacrificing comfort. As Nostromo’s CEO Yoram Ashery put it:
“Cooling by commercial buildings and data centres is the single largest load on the grid… making these large loads flexible and operable interactively with the power grid demonstrates how buildings and data centres can help the grid unlock existing capacity to serve new demands.”
Why this beats brute-force electrification alone
Here’s the thing about decarbonisation: just electrifying everything without managing when power is used is a recipe for grid stress and higher emissions. Thermal energy storage tackles that head-on.
Compared with relying only on battery energy storage:
- Cost per kWh (thermal) is often lower, because you’re storing cold in relatively cheap materials (water, tanks, insulation) rather than in electrochemical cells.
- Lifetime can be longer, with fewer degradation issues than lithium-ion.
- Safety risks are reduced – no flammable electrolytes.
- Use-case fit is excellent for cooling-dominated buildings and data centres.
Batteries are still essential for many applications, but if you’re trying to cut peak demand from chillers and air conditioning, it’s inefficient to convert electricity to chemical storage and back again when you can store energy directly as cold.
Virtual Power Plants: From Hotel Roofs to Grid-Scale Impact
The IceBrick project at the Beverly Hilton is not just a one-off. It’s part of a wider strategy to build a virtual power plant (VPP) of thermal assets across California.
In late 2024, the US Department of Energy offered Nostromo a conditional loan commitment of up to US$305.54 million for Project IceBrick. The goal: deploy up to 193 cold thermal storage systems in commercial buildings statewide.
What this VPP actually does
A thermal VPP built from IceBrick installations can:
- Aggregate hundreds of buildings into hundreds of megawatts of flexible capacity
- Shift gigawatt-hours of cooling load from late afternoon peaks to night-time valleys
- Act like a “negative power plant” by removing demand from the grid on command
Platforms like Olivine’s ClimateResponse handle the hard part:
- Compliance with complex CAISO market rules
- Forecasting building loads and available flexibility
- Optimising dispatch schedules against price signals
- Providing performance measurement and verification for revenue settlement
This is where AI and data really start to matter. A VPP is only as good as its forecasts and control strategies. The more accurately the platform can predict building behaviour and grid conditions, the more value it can extract from the same hardware.
From a green technology perspective, you’re seeing three trends intersect:
- Advanced hardware (modular thermal storage like IceBrick)
- Smart software (DER platforms with optimisation and forecasting)
- Market access (participation in CAISO and demand-side programmes)
Most companies only pay attention to #1. The smart ones realise the real value is in combining all three.
Why Building Owners and Data Centres Should Care
If you own or operate a large commercial building, hospital, campus, or data centre, you’re sitting on an underused asset: your cooling system. IceBrick-style projects show how to turn that into a new revenue stream plus serious savings.
Direct business benefits
Here’s what I’ve seen work for organisations that treat flexible cooling as a strategic asset:
-
Lower energy bills
Shift cooling to off-peak hours with cheaper tariffs while trimming demand charges tied to your highest 15–30 minute peaks. -
New income from grid services
Enrol in demand response, DSGS-like programmes, or wholesale market participation through an aggregator. Even modest capacity payments add up across a portfolio. -
Improved resilience
Thermal storage can help maintain cooling during grid stress events or short outages, buying time for backup systems. -
ESG and net-zero progress
By cutting peak demand (which is often served by gas peakers), you reduce the emissions intensity of your consumption even before you add more onsite renewables.
What a typical deployment journey looks like
For a portfolio owner considering thermal energy storage today, a practical path usually includes:
-
Site screening
Identify buildings with high and recurring cooling loads, especially in regions with volatile prices or strong demand response markets. -
Techno-economic assessment
Model:- Load profile and cooling demand
- Tariff structures and demand charges
- Available grid programmes (e.g., capacity, demand response, VPP)
- Payback period and IRR with and without incentives
-
System design and integration
Size the thermal storage; integrate with existing chillers and building management systems; define control logic for charging and discharging. -
Market participation setup
Work with a DER integrator or aggregator (like Olivine in the IceBrick case) to register assets, define dispatch strategies, and set performance baselines. -
Optimisation with AI-driven controls
Continuously refine dispatch based on:- Real-time prices or signals
- Weather forecasts
- Occupancy and comfort constraints
- Historical performance data
If this sounds complex, that’s exactly why strong partners and platforms matter. The good news: once the system is in place, most of this runs in the background while you collect the savings.
Thermal Storage in the Bigger Green Technology Picture
Our Green Technology series keeps coming back to one core theme: we won’t hit climate goals by focusing only on generation. We need smarter grids, smarter cities, and smarter buildings.
Thermal energy storage fits that narrative perfectly:
- It’s behind the meter, so adoption is often faster than large grid projects.
- It leverages assets companies already depend on – cooling and HVAC – instead of adding entirely new infrastructure.
- It’s naturally suited to AI-powered optimisation, because load shifting and dispatch decisions are data-rich problems.
In parallel, markets such as CAISO, PJM, and others are opening more doors for distributed energy resources and virtual power plants. Programmes like California’s DSGS – even if funding shifts – demonstrate there’s appetite for scale. Sunrun called DSGS the largest VPP in the US, “and probably the world.” That’s the direction of travel.
The reality? It’s simpler than many executives think:
If your organisation runs big chillers, you can probably turn part of that cooling demand into a flexible, paid grid service using mature technology that’s already being proven in live markets.
The hard part isn’t the physics. It’s the mindset.
Where to Go From Here
Nostromo’s IceBrick entering the CAISO market is more than a headline about a single project. It’s a signal: thermal energy storage is ready to sit alongside batteries, not behind them.
For energy managers, sustainability leads, and data centre operators, the next step is straightforward:
- Start mapping where cooling dominates your load profile.
- Quantify what 10–30% peak reduction would mean in dollars and tonnes of CO₂.
- Talk to technology providers and VPP platforms that can monetise that flexibility.
Green technology isn’t just about new solar farms or futuristic batteries. Sometimes it’s ice on a rooftop, orchestrated by smart software, quietly reshaping how the grid works.
The question for your organisation is simple: will your buildings stay passive consumers, or will they join the next generation of active, flexible grid partners?