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Virtual Power Plants: Running renewable energy in the cloud

They’re the power plants of the future. They have the ability to run energy in the cloud, just not the kind you find in the sky (although the sun has a lot to do with it).

A Virtual power plant (VPP) supplies renewable energy on demand by using innovative web-based technology, to remotely link and manage homes with solar and battery storage.

They’re designed to support and feed power back into the grid during peak times, to relieve the load and keep the network stable.

It isn’t a new concept but the technology behind it, and the role VPPs will play in powering our energy future, is.

How do virtual power plants work?

A VPP gets its power from a pool of distributed energy resources (DERs) spread across the network, usually solar panels and batteries connected to homes or businesses that generate and store energy from the sun. So a VPP is where a portfolio of DERs from multiple customers (known as aggregated DER) become available to provide services to the energy market when required.

Using smart cloud-based technology, a VPP can behave similar to a single traditional generator. As this kind of network is virtual, the system can quickly monitor, control and balance electricity demand, supply and storage in response to changing household needs.

Why all the fuss about virtual power plants?

Distributed energy resources have come a long way in a very short time. The installed capacity of rooftop solar panels across our network now exceeds 1.1GW – that’s around three times the size of the largest power station in the South West Interconnected System (SWIS).

This kind of solar uptake is set to continue and with other DERs in the energy mix, it presents both opportunities and challenges for future-proofing the grid.

VPPs are one way we can integrate the grid with renewables, maximise grid efficiency and make energy more affordable for customers.

What does the current virtual power plant landscape look like in WA?

There are now 13 community-scale batteries across the grid with most of them being PowerBanks in partnership with Synergy. This is a small step towards the introduction of VPPs in WA but one that’s helping improve power quality and provide benefits for local communities by managing peak loads.  They also enable homes and businesses to integrate more rooftop solar and incorporate new technologies onto the grid. And with another 50MW of additional distribution storage planned, we are moving further towards VPPs being an important part of our energy future. 

The peer to peer energy sharing trials in White Gum Valley and Fremantle are other examples of  VPP being rolled out within a new residential development. But the innovation of a VPP means that the benefits of aggregated DER are taken beyond a peer to peer community by providing services to the energy market.

So, what are we to make of all this innovation?

While VPPs are still in its early stages here in WA, the future does look bright. As Nicola Wright, our Head of Change and Innovation puts it, “One of the things we’re seeing is the price of DER coming down significantly as technology matures (and becomes mainstream), so it becomes cheaper to manufacture and is more accessible.

“The GTEng project is a pretty good case study of how we’re quickly evolving and what we’re doing to transition to that new energy future.”

VPPs are only part of the solution, but one thing’s for sure, the potential is here to shape a cleaner energy future for WA.