Virtual power plant

Last updated

A virtual power plant (VPP) is a system that integrates multiple, possibly heterogeneous, power sources to provide grid power. [1] A VPP typically sells its output to an electric utility. [2] [3] [4] [5] [6] [7] VPPs allow energy resources that are individually too small to be of interest to a utility to aggregate and market their power. [6] As of 2024, VPPs operated in the United States, Europe, and Australia.

Contents

One study reported that VPPs during peak demand periods are up to 60% more cost effective than peaker plants. [8]

Distributed energy resources

VPPs typically aggregate large numbers of distributed energy resources (DER). Resources can be dispatchable or non-dispatchable, controllable or flexible load (CL or FL). Resources can include microCHPs, natural gas-fired reciprocating engines, small-scale wind power plants (WPP), photovoltaics (PV), run-of-river hydroelectricity plants, small hydro, biomass, backup generators, and energy storage systems such as home or vehicle batteries (ESS), and devices whose consumption is adjustable (such as water heaters, and appliances). The numbers and heterogeneity mean that system output is not dependent on any single resource, offering the potential for stable output even if the output of any single resource is not predictable.

Vehicle to Grid technology allows electric vehicles that are connected to the grid to participate in VPPs. The VPP then controls the rate at which each vehicle charges/discharges (accepts/delivers power). The VPP can slow or reverse the rate at which vehicles charge. Conversely, when the grid has surplus power, vehicles can charge freely.

The same principle applies to other systems, such as heat pumps or air conditioners that can lower their power demands to reduce demand. [9]

VPPs based on storage can ramp at higher rates than thermal generators (such as fossil fuel plants), which is especially valuable in grids that experience a duck curve and must satisfy high ramping requirements in the morning and evening.

Operation

Power delivery is controlled by a management system. The distributed nature of VPPs requires software to respond appropriately and securely to power requests, utility billing, payments to resource owners, etc. [10] [11]

Services

Typically, the VPP provides power (only) when requested by the utility.

Peak shaving

With the appropriate resources, a VPP can deliver incremental power on short notice, allowing it to help utilities manage peak loads that would otherwise require purchasing expensive power from a peaker plant (typically operating a simple cycle or combined cycle natural gas turbine).

Load following

Given sufficient scale, a VPP can operate as a load-following generator, supplying output dynamically as demand changes throughout the day/night cycle.

Ancillary services

Virtual power plants can provide ancillary services that help maintain grid stability such as frequency regulation and providing operating reserve. These services are primarily used to maintain the instantaneous balance of electrical supply and demand. These services must respond to signals to increase or decrease load on the order of seconds to minutes.

Energy trading

A VPP generates revenue that is distributed among the resources that supply the power, encouraging resource owners to join the enterprise.

Energy markets are wholesale commodity markets that deal specifically with electrical energy. [12] [6] Market prices fluctuate with demand and when other resources fail (e.g., when the wind does not blow). The VPP behaves as a conventional dispatchable power plant from the point of view of other market participants. A VPP acts as an arbitrageur between diverse energy trading floors (i.e., bilateral and PPA contracts, forward and futures markets, and the pool). [3] [4] [5] [7]

Five risk-hedging strategies have been applied to VPP decision-making problems to measure the level of conservatism of VPPs' decisions in energy trading floors (e.g., day-ahead electricity market, derivatives exchange market, and bilateral contracts):

Markets

United States

In the United States, virtual power plants deal with the supply side and help manage demand, and ensure reliability of grid functions through demand response (DR) and other load-shifting approaches, in real time. [14] In 2023 the Department of Energy estimated VPP capacity at around 30 to 60 GW, some 4% to 8% of peak electricity demand. [8]

Texas has two Tesla-operated VPPs. Eligible Tesla Electric members automatically join the Virtual Power Plant, made up of Tesla Powerwall batteries. As such the VPP takes power when the grid needs support. Tesla pays the owner a monthly fee in addition to payment per unit of energy delivered. [15]

California has two electric markets: private retail and wholesale. As of 2022 PG&E paid VPP providers $2/kWh during peak demand. [16] As of August/September 2022, SunRun VPP often delivered 80 MW at peak times, [17] and Tesla VPP supplied 68 MW. [18] [19]

Vermont’s Green Mountain Power, works with Tesla to offer a Powerwall to participating customers at a discounted rate. [8]

Three Massachusetts utilities, National Grid, Eversource, and Cape Light Compact implemented a VPP. [8]

Europe

The Institute for Solar Energy Supply Technology of Germany's University of Kassel pilot-tested a VPP that linked solar, wind, biogas, and pumped-storage hydroelectricity to provide load-following power from renewable sources. [20] VPPs are commonly referred to as aggregators.

One VPP operated on the Scottish Inner Hebrides island of Eigg. [21] [22]

Next Kraftwerke from Cologne, Germany operates a VPP in seven European countries providing peak-load resources, power trading and grid balancing services. The company aggregates energy from biogas, solar and wind as well as large-scale power consumers. [23]

Distribution network operator, UK Power Networks, and Powervault, a battery manufacturer and power aggregator, created London's first VPP in 2018, installing a fleet of battery systems at 40+ homes across the London Borough of Barnet, offering capacity of 0.32 MWh. [24] This scheme was expanded through a second contract in St Helier, London in 2020. [25]

In September 2019, SMS plc entered the VPP sector in the United Kingdom following the acquisition of Irish energy tech start-up, Solo Energy. [26]

In October 2020, Tesla launched its Tesla Energy Plan in the UK in partnership with Octopus Energy, allowing households to join its VPP. Participant homes are powered with renewable energy either from solar panels or from Octopus Energy. [27]

In June 2024, German companies Enpal and Entrix announced plans to create Europe's largest Virtual Power Plant (VPP). The VPP will integrate a large number of decentralized energy resources including solar panels, batteries, and electric vehicles. Enpal, already a leading solar installer with more than 70,000 installed systems, plans to connect thousands of households with solar power and storage units to the VPP, offering greater energy independence and grid stability. [28] [29]

Australia

In August 2020, Tesla began installing a 5 kW rooftop solar system and 13.5 kWh Powerwall battery at each Housing SA premises, at no cost to the tenant. As South Australia's largest virtual power plant, the battery and solar systems were centrally managed, collectively delivering 20 MW of generation capacity and 54 MWh of energy storage. [30]

In August 2016, AGL Energy announced a 5 MW virtual-power-plant scheme for Adelaide, Australia. The company planned to supply battery and photovoltaic systems from Sunverge Energy, of San Francisco, to 1000 households and businesses. The systems cost consumers AUD $3500 and was expected to recoup the expense in 7 years under current distribution network tariffs. The scheme is worth AUD $20 million and is billed as the largest in the world. [31]

See also

Related Research Articles

<span class="mw-page-title-main">Energy storage</span> Captured energy for later usage

Energy storage is the capture of energy produced at one time for use at a later time to reduce imbalances between energy demand and energy production. A device that stores energy is generally called an accumulator or battery. Energy comes in multiple forms including radiation, chemical, gravitational potential, electrical potential, electricity, elevated temperature, latent heat and kinetic. Energy storage involves converting energy from forms that are difficult to store to more conveniently or economically storable forms.

<span class="mw-page-title-main">Distributed generation</span> Decentralised electricity generation

Distributed generation, also distributed energy, on-site generation (OSG), or district/decentralized energy, is electrical generation and storage performed by a variety of small, grid-connected or distribution system-connected devices referred to as distributed energy resources (DER).

Energy demand management, also known as demand-side management (DSM) or demand-side response (DSR), is the modification of consumer demand for energy through various methods such as financial incentives and behavioral change through education.

<span class="mw-page-title-main">Grid energy storage</span> Large scale electricity supply management

Grid energy storage is a collection of methods used for energy storage on a large scale within an electrical power grid. Electrical energy is stored during times when electricity is plentiful and inexpensive or when demand is low, and later returned to the grid when demand is high, and electricity prices tend to be higher.

<span class="mw-page-title-main">Peaking power plant</span> Reserved for high demand times

Peaking power plants, also known as peaker plants, and occasionally just "peakers", are power plants that generally run only when there is a high demand, known as peak demand, for electricity. Because they supply power only occasionally, the power supplied commands a much higher price per kilowatt hour than base load power. Peak load power plants are dispatched in combination with base load power plants, which supply a dependable and consistent amount of electricity, to meet the minimum demand.

<span class="mw-page-title-main">Vehicle-to-grid</span> Vehicle charging system that allows discharge and storage of electricity

Vehicle-to-grid (V2G) describes a system in which plug-in electric vehicles (PEVs) sell demand response services to the grid. Demand services are either delivering electricity to the grid or reducing the rate of charge from the grid. Demand services reduce the peaks in demand for grid supply, and hence reduce the probability of disruption from load variations. Vehicle-to-load (V2L) and Vehicle-to-vehicle (V2V) are related, but the AC phase is not synchronised with the grid, so the power is only available to "off-grid" load.

<span class="mw-page-title-main">Demand response</span> Techniques used to prevent power networks from being overwhelmed

Demand response is a change in the power consumption of an electric utility customer to better match the demand for power with the supply. Until the 21st century decrease in the cost of pumped storage and batteries, electric energy could not be easily stored, so utilities have traditionally matched demand and supply by throttling the production rate of their power plants, taking generating units on or off line, or importing power from other utilities. There are limits to what can be achieved on the supply side, because some generating units can take a long time to come up to full power, some units may be very expensive to operate, and demand can at times be greater than the capacity of all the available power plants put together. Demand response, a type of energy demand management, seeks to adjust in real-time the demand for power instead of adjusting the supply.

<span class="mw-page-title-main">Moss Landing Power Plant</span> Natural gas-fired power station in Moss Landing, California

The Moss Landing Power Plant is a natural gas powered electricity generation plant located in Moss Landing, California, United States, at the midpoint of Monterey Bay. Its large stacks are landmarks, visible throughout the Monterey Bay Area. The plant is owned and operated by Houston-based Dynegy and currently has a generation capacity of 1020 MW (net) from its two combined cycle generation units. It was once the largest power plant in the state of California, with a generation capacity of 2560 MW, before its two large supercritical steam units were retired in 2016.

<span class="mw-page-title-main">Hybrid power</span> Combinations between different technologies to generate electric power

Hybrid power are combinations between different technologies to produce power.

A load-following power plant, regarded as producing mid-merit or mid-priced electricity, is a power plant that adjusts its power output as demand for electricity fluctuates throughout the day. Load-following plants are typically in between base load and peaking power plants in efficiency, speed of start-up and shut-down, construction cost, cost of electricity and capacity factor.

<span class="mw-page-title-main">Solar power</span> Conversion of energy from sunlight into electricity

Solar power, also known as solar electricity, is the conversion of energy from sunlight into electricity, either directly using photovoltaics (PV) or indirectly using concentrated solar power. Solar panels use the photovoltaic effect to convert light into an electric current. Concentrated solar power systems use lenses or mirrors and solar tracking systems to focus a large area of sunlight to a hot spot, often to drive a steam turbine.

<span class="mw-page-title-main">Solar power in California</span>

Solar power has been growing rapidly in the U.S. state of California because of high insolation, community support, declining solar costs, and a renewable portfolio standard which requires that 60% of California's electricity come from renewable resources by 2030, with 100% by 2045. Much of this is expected to come from solar power via photovoltaic facilities or concentrated solar power facilities.

<span class="mw-page-title-main">Solar power in Hawaii</span> Overview of solar power in the U.S. state of Hawaii

The energy sector in Hawaii has rapidly adopted solar power due to the high costs of electricity, and good solar resources, and has one of the highest per capita rates of solar power in the United States. Hawaii's imported energy costs, mostly for imported petroleum and coal, are three to four times higher than the mainland, so Hawaii has motivation to become one of the highest users of solar energy. Hawaii was the first state in the United States to reach grid parity for photovoltaics. Its tropical location provides abundant ambient energy.

<span class="mw-page-title-main">Energy in California</span> Overview of the use of energy in California, U.S.

Energy is a major area of the economy of California. California is the state with the largest population and the largest economy in the United States. It is second in energy consumption after Texas. As of 2018, per capita consumption was the fourth-lowest in the United States partially because of the mild climate and energy efficiency programs.

<span class="mw-page-title-main">Electricity sector in Australia</span>

The electricity sector in Australia has been historically dominated by coal-fired power stations, but renewables are forming a rapidly growing fraction of supply. In 2021, Australia's electricity production reached 265 TWh, with coal accounting for 52.9% and natural gas for 18.8%. Renewable sources, comprising solar, wind, hydro, and bioenergy with waste, collectively made up 26.7% of the total electricity generation mix.

<span class="mw-page-title-main">Tesla Powerwall</span> Home battery energy storage product manufactured by Tesla Energy

The Tesla Powerwall is a rechargeable lithium-ion battery stationary home energy storage product manufactured by Tesla Energy. The Powerwall stores electricity for solar self-consumption, time of use load shifting, and backup power.

<span class="mw-page-title-main">Tesla Powerpack</span> Large-scale battery energy storage product manufactured by Tesla Energy

The Tesla Powerpack was a rechargeable lithium-ion battery stationary energy storage product, intended for use by businesses or on smaller projects from power utilities. The device was manufactured by Tesla Energy, the clean energy subsidiary of Tesla, Inc. The Powerpack stores electricity for time of use load shifting, backup power, demand response, microgrids, renewable energy integration, frequency regulation, and voltage control. The first prototype Powerpacks were installed in 2012 at the locations of a few industrial customers. After July 22, 2022, the product was no longer listed for sale.

<span class="mw-page-title-main">Tesla Megapack</span> Large-scale battery energy storage product manufactured by Tesla Energy

The Tesla Megapack is a large-scale rechargeable lithium-ion battery stationary energy storage product, intended for use at battery storage power stations, manufactured by Tesla Energy, the energy subsidiary of Tesla, Inc.

<span class="mw-page-title-main">Enel North America</span> American company headquartered in Andover, MA, United States

Enel North America is an American company headquartered in Andover, MA, United States. One of the renewable energy operators in North America, it was formed as a subsidiary of the global utility Enel S.p.A. in 2000. It has operations in the United States and Canada through its renewables and energy services businesses, with a portfolio including over 9.6 GW of renewable capacity, 160,000 EV charging stations, 4.7 GW of demand response capacity and 14 utility-scale battery energy storage systems, totaling 1,416 MWh of capacity under construction or in operation. It serves a customer base of over 4,500 businesses, utilities, and cities in North America.

References

  1. ↑ Landsbergen, Patrick (17 June 2009). Feasibility, beneficiality, and institutional compatibility of a micro-CHP virtual power plant in the Netherlands (BSc thesis) – via repository.tudelft.nl.
  2. ↑ Zurborg, Aaron (2010). "Unlocking Customer Value: the Virtual Power Plant" (PDF). Energy.gov. Retrieved 15 January 2023.
  3. 1 2 3 Shabanzadeh M; Sheikh-El-Eslami, M-K; Haghifam, P; M-R (January 2015). "Decision Making Tool for Virtual Power Plants Considering Midterm Bilateral Contracts". 3rd Iranian Regional CIRED Conference and Exhibition on Electricity Distribution, at Niroo Research Institute (NRI), Tehran, Iran. 3 (3): 1–6. doi:10.13140/2.1.5086.4969.
  4. 1 2 3 Shabanzadeh M; Sheikh-El-Eslami, M-K; Haghifam, P; M-R (October 2015). "The design of a risk-hedging tool for virtual power plants via robust optimization approach". Applied Energy. 155: 766–777. doi:10.1016/j.apenergy.2015.06.059.
  5. 1 2 3 Shabanzadeh M; Sheikh-El-Eslami, M-K; Haghifam, P; M-R (May 2016). "A medium-term coalition-forming model of heterogeneous DERs for a commercial virtual power plant". Applied Energy. 169: 663–681. doi:10.1016/j.apenergy.2016.02.058.
  6. 1 2 3 4 Shabanzadeh M; Sheikh-El-Eslami, M-K; Haghifam, P; M-R (January 2017). "Risk-based medium-term trading strategy for a virtual power plant with first-order stochastic dominance constraints". IET Generation, Transmission & Distribution. 11 (2): 520–529. doi:10.1049/iet-gtd.2016.1072. S2CID   114478127.
  7. 1 2 3 Shabanzadeh M; Sheikh-El-Eslami, M-K; Haghifam, P; M-R (April 2016). "Modeling the cooperation between neighboring VPPS: Cross-regional bilateral transactions". 2016 Iranian Conference on Renewable Energy & Distributed Generation (ICREDG). Vol. 11. pp. 520–529. doi:10.1109/ICREDG.2016.7875909. ISBN   978-1-5090-0857-5. S2CID   16453458.
  8. 1 2 3 4 Kim, June (February 7, 2024). "How virtual power plants are shaping tomorrow's energy system". MIT Technology Review. Retrieved 2024-02-28.
  9. ↑ Lee, Zachary E.; Sun, Qingxuan; Ma, Zhao; Wang, Jiangfeng; MacDonald, Jason S.; Zhang, K. Max (Feb 2020). "Providing Grid Services With Heat Pumps: A Review". Journal of Engineering for Sustainable Buildings and Cities. 1 (1). doi: 10.1115/1.4045819 . S2CID   213898377.
  10. ↑ Fang, Xi; Misra, Satyajayant; Xue, Guoliang; Yang, Dejun (2012). "Smart Grid — The New and Improved Power Grid: A Survey". IEEE Communications Surveys & Tutorials. 14 (4): 944–980. doi:10.1109/SURV.2011.101911.00087. ISSN   1553-877X.
  11. ↑ "Manage the Virtual Power and prevent a blackout!". Next Kraftwerke. Retrieved 2 December 2019.
  12. ↑ JEAN-PHILIPPE TAILLON, CFA (2021-10-14). "Introduction to the World of Electricity Trading". Investopedia. Retrieved 2022-01-04.
  13. ↑ Shabanzadeh, Morteza; Sheikh-El-Eslami, Mohammad-Kazem; Haghifam, Mahmoud-Reza (2017). "An interactive cooperation model for neighboring virtual power plants". Applied Energy. 200: 273–289. doi:10.1016/j.apenergy.2017.05.066. S2CID   157309706.
  14. ↑ Aaron Zurborg (2010). "Unlocking Customer Value: The Virtual Power Plant". WorldPower 2010: 1–5.
  15. ↑ "Tesla Electric Virtual Power Plant Beta with ERCOT". tesla.com. Retrieved February 29, 2024.
  16. ↑ "PG&E, Tesla virtual power plant delivers 16.5 MW to California grid amid calls for energy conservation". Utility Dive. 23 August 2022.
  17. ↑ Colthorpe, Andy (8 September 2022). "California's fleet of battery storage working to avert energy crisis". Energy Storage News.
  18. ↑ Lambert, Fred (2022-09-02). "Tesla virtual power plant is rocketing up, reaches 50 MW". Electrek. Retrieved 2022-09-08.
  19. ↑ "Tesla's Virtual Power Plant Tracker". Lastbulb. Retrieved 2022-09-08.
  20. ↑ "The Combined Power Plant: the first stage in providing 100% power from renewable energy". SolarServer. January 2008. Archived from the original on 2008-10-14. Retrieved 2008-10-10.
  21. ↑ Gardiner, Karen. "The small Scottish isle leading the world in electricity". www.bbc.com. Retrieved 2023-07-17.
  22. ↑ BBC Radio 4. Costing the Earth- Electric Island
  23. ↑ "Next Kraftwerk Reimagines & Redefines The Electrical Grid With Virtual Power Plants". Clean Technica. October 2016. Retrieved 2019-03-13.
  24. ↑ "Electricity network plan to launch London's first virtual power station". UK Power Networks. 22 June 2018. Retrieved 15 October 2021.
  25. ↑ "London pioneers first 'virtual power station'". GOV.UK. 6 March 2020. Retrieved 1 July 2021.
  26. ↑ Grundy, Alice (27 March 2020). "Smart Metering Systems reveals Solo Energy acquisition as it enters VPP market". Current News. Retrieved 1 July 2021.
  27. ↑ Lempriere, Molly (27 October 2020). "Tesla Energy Plan launched inviting homes to become part of Virtual Power Plant". Current News. Retrieved 1 July 2021.
  28. ↑ "Enpal, Entrix reveal plans for Europe's biggest VPP". PV Magazine. 14 June 2024. Retrieved 25 September 2024.
  29. ↑ "So baut Solar-Installateur Enpal das größte virtuelle Kraftwerk in Europa". Frankfurter Allgemeine Zeitung. 14 June 2024. Retrieved 25 September 2024.
  30. ↑ "Social housing added to the Tesla virtual power plant - ARENAWIRE". Australian Renewable Energy Agency. 4 September 2020. Retrieved 2021-01-06.
  31. ↑ Slezak, Michael (5 August 2016). "Adelaide charges ahead with world's largest 'virtual power plant'". The Guardian . Retrieved 2016-08-05.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.