Virtual Power Plant (VPP) Market Outlook to 2028

Drivers:

• Growth of Smart Energy solutions
• Increasing growth of energy storage system
• Growth in renewable energy policies
• Increasing renewables penetration in microgrids due to cost reductions and technological advancements
• Digitalisation, automation, and real-time control of the power system
• Energy flexibility/demand response is becoming increasingly critical with the growth of renewables
• The power sector regulation allows for more active participation of distributed generation and demand in electricity markets

Definition and Benefits:

A Virtual Power Plant (VPP) is a shared cloud-based network with a decentralized multi-asset ecosystem consisting of a mix of energy generators, energy storage, and energy assets managed by a single control system with bidirectional communications between its components to achieve more efficient operation. The goal of VPP is to connect distributed energy resources (DER) to be monitored, forecasted, optimized, and traded.

Benefits:

• VPP monitors the network of DERs and makes moderate modifications to Flexible Energy Assets, such as turning them on or off in response to changing energy demands, resulting in a more stable and efficient system
• Allows smaller Flexible Energy Assets to be grouped so that they can buy energy from a single developer, or numerous developers, as a single larger business while still taking full advantage of a high-volume purchase
• Since the consumption points are very close to those where energy is generated, there is a decrease in the energy loss during transportation
• VPP enables local grid operators to use energy flexibility to assure a more stable electricity supply, improved energy efficiency, and more grid capacity for renewables
• They allow asset owners to increase profits and reduce their overheads and carbon footprint without affecting their energy supply or risking their finances
• This Platform provides capabilities for market participation (bidding, communication) and economic participation
• When compared to traditional power plants, the cost of establishing VPPs is extremely low, especially given the changing market and grid dynamics as a result of the energy transition

Restraints:

• Resistance from traditional utilities amid concerns about grid safety and stability
• The requirement for regulatory support
• Social acceptance
• Infrastructure challenges

Recent Trends & Developments:

• On September 17, 2020, The Federal Energy Regulatory Commission made a new rule on Distributed Energy Resources (DER). It's also creating the framework for major changes in the energy market and grid. The ruling, known as FERC 2222, aims to lower barriers to entry for distributed energy resources (DERs) and might boost electricity market competition
• On May 10, 2021, Kiwi Power has partnered with a Japanese leader in energy technology ENECHANGE to bring Japanese energy players in the Commercial & Industrial (C&I) sectors the technology and to participate in the country’s emerging flexibility programs featuring Virtual Power Plant (VPP) capabilities to monetise their underutilised energy assets
• In July 2020, Kiwi Power, along with ENGIE North America had expanded its sales presence in the North American market, offering advanced virtual power plant (VPP) software
• In early 2021, AutoGrid VPPs were dispatched 1,800 times connecting 100,000 of assets, delivering over 5GW of capacity under the contract and 37 GWh of energy when the electricity grid was most stressed

Opportunities:

• Turnkey VPPs- U.S.A, Germany
• Enrolment of Data Centers to VPPs
• Distributed generation assets - Asia Pacific (Australia, South Korea, Japan, and New Zealand), Europe, and North America

Publisher's Virtual Power Plant (VPP) market report provides insights into the current global and regional Global market demand scenario and its outlook.

This study offers a detailed analysis of various factors instrumental in affecting the Virtual Power Plant (VPP) market's growth. The study also comprehensively analyses the market based on the technology (Distributed generation and mixed assets) and geography (North America, Europe, Asia-Pacific, and the Rest of the world).

This report also includes the latest market trends, drivers and restraints, present and future opportunities, new projects, the global impact of Covid-19 on the Virtual Power Plant (VPP) market, and significant developments.

Further, the report will also provide Virtual Power Plant (VPP) or market size, demand forecast, and key competitors in the market.


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