The Internet of Things has been a driving force for major change across most world industries, and the energy sector is no stranger to its contributions to technological advancement. One significant facet of this sector’s IoT-based growth is the evolution of virtual power plants, or “cloud-based distributed power plants that aggregate the capacities of heterogeneous Distributed Energy Resources (DERs).” These systems are instrumental in ensuring energy source reliability, and they have become a full-fledged microcosm of the IoT movement. Virtual power plants (VPPs) are energy plants that use communication technology, namely IoT sensors, to gather data and allow their operators to monitor and control energy production from each plant. VPPs instill better power stability and reliability by blending various types of power sources, ranging from battery storage facilities and wind farms to hydro and solar PV plants. A virtual power plant (VPP) is a cloud-based distributed power plant that aggregates the capacities of heterogeneous Distributed Energy Resources (DERs) for the purposes of enhancing power generation, as well as trading or selling power on the open market. Examples of virtual power plants exist in the United States, Europe, and Australia.
VPP/MMS: Functional Overview
The key functionalities of a Virtual Power Plant/Microgrid Management System (VPP/MMS) include integration of different, heterogeneous energy sources and loads (“assets”), asset data management, energy management, and integration with external partners. Using our Asset Integration Architecture (AIA) once again as a reference, the following diagram provides an overview of a typical VPP/MMS.
Integration with the different energy sources and loads can either occur through the installation of a local gateway and/or agent directly on the asset, or – if the asset already provides remote integration capabilities – through a connector in the backend.The VPP/MMS backend typically provides some kind of asset management functionality, which enables configuration and administration of the various integrated assets. Asset-related data, such as master data and asset history including events, faults, and time series data, are managed centrally.Building on this asset data, the VPP/MMS implements the logic required to manage the different assets and their energy supply and consumption levels. This includes modeling and forecasting, scheduling, and real-time optimization. As most microgrids will not be able to function completely autonomously, the VPP/MMS must also be integrated with external systems to receive information such as weather forecast data and market prices. In addition, the VPP/MMS will in many cases be integrated with external processes such as energy trading, billing, and other processes related to TSOs/DSOs (Transmission and Distribution System Operators).
Business Model of VPP
By successfully combining business and technology innovations, VPP has developed a pioneering business concept based on the powerful synergies between existing energy market segments. This enables us to provide comprehensive services to energy producers and consumers alike.Our Virtual Power Plant Solution (VPPS) is a robust IT structure which connects energy producers and consumers to each other and to other market segments in real time through a smart grid. The virtual power plant operates 24/7 without interruption.
Energy producers offer up their free capacities to VPP’s Virtual Power Plant. VPP purchases the capacity flexibilities from energy producers, manages the power plant production based on real-time sales demands and sells the electricity produced on multiple markets at the same time: on the Hungarian Power Exchange (HUPX), on the balancing energy market and directly to end-users. All this leads to higher margins for small-scale power plants without the additional costs of sales and balancing energy.
How does a Virtual Power Plant work?
A Virtual Power Plant consists of a central IT control system and distributed energy resources (often renewable energy resources like solar, wind, hydropower, and biomass units) as well as flexible power consumers. By networking all participating units through a remote control unit, it establishes a data transfer between the central control system and the participating units. The central control system is then able to monitor, forecast, and dispatch the networked units.
The DG specification is useful to broadly mention the range of capabilities for various technologies, generally falling under the distributed generation category. DER considered for
integration in VPP
- hydraulic Pumped Energy Storage (HPES)
- compressed air energy storage (CAES)
- flywheel energy storage (FWES)
- super conductor magnetic energy storage (SMES)
- battery energy storage system (BESS)
- supercapacitor energy storage (SCES)
- hydrogen along with fuel cell (FC)
Energy Storage Technologies
Energy storage systems can be considered today as a new mean to adapt the variations of the power demand to the given level of power generation. In context of use renewable generation, can be used also as additional sources or as energy buffers in the case of non-dispatchable or stochastic generation, e.g. wind turbines or PV technologies especially in weak networks.ESS considered for integration in VPP:
- Continuous condition monitoring – retrieval of equipment historical loadings
- Asset management – supported by statistical data
- Self-identification/self-description of system components
- Fault location – automatically integrated with outage management
- Statistical analysis and project portfolio optimization
Information Communication Technology (ICT)
The important requirement for VPP is communication technologies and infrastructure. In many different communications, media technologies can be considered for communications in Energy Management Systems (EMS), Supervisory Control and Data Acquisition (SCADA) and Distribution Dispatching Center (DCC).
Virtual Power Plant Solution (VPPS)
The VPPS (Virtual Power Plant Solution) is a true smart grid solution, capable of ensuring real-time balance between generation and consumption, while the system also provides a high level of flexibility and security in counterbalancing irregularities in electricity production. As a result of this revolutionary innovation, we can offer a supply of electricity more cheaply and efficiently than other current suppliers, while making generation more predictable and consumption more /conscious/. The VPPS is an integrated business and technological innovation: besides supporting small power plants with their production management and sales, and by linking them together, it provides our partners with a competitive alternative business model, thanks to the business know-how and built-in optimization solutions. VPPS integrates all the hardware, software, business intelligence and the know-how of VPP’s team of experts required for the operation of virtual power plants into a single complex system. In addition, it creates a customized IT system which is able to adapt in a flexible manner to the special needs and characteristics of individual countries, markets and partners.
Virtual Power Plant Market
The report “Virtual Power Plant Market by Enabling Technology (Demand Response, Distributed Generation, and Mixed Asset), End-Use Customer (Commercial & Industrial, and Residential), and by Region – Global Trends & Forecasts to 2021″, The virtual power plant market is expected to grow from an estimated USD 193.4 Million in 2016 to USD 709.2 Million by 2021, registering a CAGR of 29.68% from 2016 to 2021. The global market is witnessing significant growth, which is driven by increasing share of renewable energy in the power generation mix as well as shift from centralized to distributed generation and lowering costs for solar and energy storage. This research service analyzes the Virtual Power Plant (VPP) market by end users (demand management, power trading), region (North America, Europe, Asia-Pacific, and Rest-of-world), trends, and revenue forecast till 2022. VPP promises significant improvements in grid reliability and resilience and early adoption has taken place in Western Europe and North America. Additionally, there is also focus on the top participants in the global market such as ABB, Next Kraftwerke, Siemens, VPP Intelligent Energy, Enbala Power Networks, and AutoGrid, Viridity Energy.