The exponential rise in decentralized energy resources (DERs) makes balancing supply and demand a challenge. EVs, for example, are expected to grow almost 40-fold by 2035 and solar capacity should rise 34-fold by 2030. VPPs reduce the complexity of connecting small assets to markets and enable optimized control based on price incentives and/or grid operator needs.
Connecting and trading energy between power plants and wind or solar farms provides flexibility on a larger scale. In the eMobility landscape, integrating EVs into the grid, using them as batteries via V2G and aligning their charging behavior with other assets/energy prices reduces their cost due to optimized usage. VPPs in residential settings ensure the full capacity of assets is leveraged, while also maximizing financial value without affecting user comfort.
The first step to a virtual power plant is acquiring the ability to connect and control distributed energy resources. Next, the assets must be connected to forecasting capabilities. Then, data - such as asset capacity and availability, price signals, constraints, set-point signals etc. - must be exchanged between assets, VPP operators and market actors. Managing and communicating with each DER in real time necessitates a complex control algorithm.