Virtual power plant

Virtual power plant
InventorShimon Awerbuch

A virtual power plant (VPP) is a system for aggregating distributed energy resources (DERs) to function to behave as a single power plant. Operators coordinate these resources to balance supply and demand, provide grid services, and participate in energy markets. A VPP typically sells its output to an electric utility. VPPs allow energy resources that are individually too small to be of interest to a utility to aggregate and market their power.

VPPs typically access dispatchable and non-dispatchable resources, including microCHPs, natural gas-fired reciprocating engines, wind power plants, photovoltaics (PV), run-of-river hydroelectricity, biomass, backup generators, battery energy storage systems (BESS) such as home or vehicle batteries. VPPs can manage demand as well as supply; e.g., heat pumps and other devices can be turned on or off based on available energy supply.

Heterogeneity and numbers reduce dependence on any single resource, improving system stability.

Vehicle-to-grid allows grid-connected electric vehicles to participate.

Storage-based VPPs ramp faster than thermal generators, e.g., helping grids with high ramp needs avoid the duck curve.

A management system securely controls operations, billing, and payments to power suppliers and consumers.

VPPs provide peak shaving by delivering power during high demand, avoiding expensive peaker plants (saving 40–60%). They offer load following and ancillary services such as frequency regulation and operating reserves, responding in seconds to minutes.

VPPs can trade energy in wholesale markets, acting as dispatchable plants. Strategies hedge risks in markets:

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