Energy Storage Knowledge Class | Brief Analysis of the VPP
Vilion Battery Energy Storage
Vilion-BESS, energy flowing with demand.
Q What is a Virtual Power Plant?
A
A virtual power plant (VPP) is a system that utilizes advanced communication and control technologies to integrate and coordinate distributed energy resources (such as wind power, photovoltaic?power generation, energy storage systems, and dispatchable loads) located in different locations. Through a VPP, distributed energy resources can collectively participate in the electricity market and grid dispatch, thereby improving energy utilization efficiency, ensuring stable operation of the power system, and maximizing economic benefits.
Q What Are the Components of a VPP?
A
The ViStarter EMS, independently developed by the Vilion?team, is a lightweight on-site control and integrated energy management platform with real-time data collection and analysis, system operation scheduling and management, as well as fault self-diagnosis and maintenance capabilities. It integrates various industrial and commercial application models, serving as a 24/7 intelligent energy management expert that continuously calculates and optimizes operational strategies for maximum user benefits.
ViStarter is primarily designed for applications involving battery energy storage systems. It optimizes the power distribution of multiple storage devices on-site and monitors the complementary integration of various energy sources (such as loads, photovoltaics, wind power, and generators) to achieve the best energy management outcomes.
In the construction and operation of VPPs, Vilion's ViStarter,, with its powerful capabilities in power distribution among multiple storage devices and multi-energy complementary monitoring, will be?an indispensable partner. By optimizing the operation strategy of on-site energy systems, it can maximize energy utilization and improves efficiency, providing strong support for the stable and efficient operation of VPPs.
View more specifications?about ViStarter EMS: ViStarter_energy management system_Vilion ( szvilion.com )
Q How does a VPP?Operate?
A
（1）Data Collection and Monitoring:?The VPP collects real-time operational data (such as power generation, energy storage status, and load demand) from distributed energy resources through sensors and communication networks.
（2）Optimization, Scheduling, and Control:?The energy management system optimizes dispatch strategies based on collected data, combined with electricity market price signals and grid demand, to coordinate the operation of distributed energy resources and ensure the balance between generation and load.
（3）Market Trading and Response: The VPP can participate in the electricity spot market and ancillary services market. By flexibly adjusting output power and load response, it can generate market revenue.
（4）Feedback and Adjustment:?Based on market transaction results and grid operational status, the VPP continuously adjusts its scheduling strategies to optimize overall operation.
Q What are the Application Scenarios and Functions of?a VPP?
A
（1）Electricity Market Trading: A VPP can participate in the electricity spot market and ancillary services market to gain market revenues, reduce energy costs, and increase economic benefits.
（2）Demand Response: By adjusting load responses, a VPP can participate in demand response projects, providing regulation capabilities to the grid. VPPs can also offer flexible dispatch capabilities to balance power supply and demand, reduce grid pressure, and enhance the stability and reliability of the power system.
（3）Emergency Backup Power: In the event of grid failures or emergencies, a VPP can act as a backup power source to ensure continuity of supply.
（4）Renewable Energy Integration: A VPP can optimize the grid integration of distributed renewable energy, alleviating grid pressure. Their integrated management capabilities help increase the proportion of distributed renewable energy, improve energy utilization efficiency, reduce waste, and promote energy transition and low-carbon development.
（5）Energy Storage Optimization: Energy storage systems are a critical component of a VPP. Through centralized scheduling and optimization algorithms, a VPP can control the charge and discharge of energy storage systems to maximize economic benefits and grid stability. For example, charging during off-peak periods and discharging during peak times or providing emergency power during grid failures.
领英推荐
（6）Electric Vehicle Charging Management: As the adoption of electric vehicles (EVs) grows, their charging demand increasingly impacts the grid. A VPP can optimize the management of EV charging loads by connecting and scheduling with EV charging facilities. This can reduce grid stress and provide more convenient and cost-effective charging services for EV users.
Q How are VPPs Implemented in Various Countries?
A
The implementation of VPPs varies by country depending on factors such as electricity market structure, policy environment, technological development, and resource endowments. Here are some examples of how VPPs are implemented in different countries:
（1）Germany
a. Policy Drivers and Market Mechanisms
The implementation of VPPs in Germany has benefited from strong policy drivers and a highly liberalized electricity market mechanism. Firstly, Germany has set clear targets for greenhouse gas reduction, advancing the goal of achieving Climate Neutrality from 2050 to 2045, and has vigorously promoted the development of renewable energy. This policy background provides a strong driving force for the development of VPPs. Secondly, Germany has adopted an operational model that separates the businesses of grid, power plant, transmission, distribution, and electricity sales, resulting in a highly liberalized electricity market. This provides essential preconditions for emerging market entities to enter the market and develop into sustainable and profitable new business models.
b. Commercial Operation Enhances the Flexibility and Profitability of the Power System
VPPs in Germany have achieved commercial operation, with operators including independent VPP?operators, large power companies, and new market participants. The German Grid Balancing Groups (also known as Balance Responsible Parties) play an important role in maintaining the balance of power supply and demand. Many VPP?operators collaborate with these balancing groups, and the Balance Responsible Parties can also operate their own VPPs. By aggregating and centrally dispatching distributed energy resources, they enhance the flexibility of the power system.
In addition, VPPs integrate distributed energy resources to participate in electricity market transactions, obtaining multiple benefits such as grid balancing services and user-side services. In Germany, VPP?operators participate in the electricity market through various trading methods, including the day-ahead market, intraday market, and balancing market.
（2）United States
a. Demand Response and Flexibility Resources
As one of the countries with the most extensive and diverse demand response programs, the United States has established a robust market for VPPs. In the U.S. electricity market, VPPs operate as independent market participants and can earn economic benefits by engaging in demand response projects. These projects are typically initiated by grid operators or energy management agencies with the goal of balancing supply and demand by incentivizing users to alter their electricity usage behavior.
VPPs integrate various distributed energy resources, including but not limited to adjustable power demands from industrial and commercial users, temperature control devices in smart home systems, and electric vehicle charging stations. Through advanced communication technologies and control systems, VPPs can monitor and adjust the electricity usage of these flexible load resources in real time.?For example, Tesla's VPP project in the United States has covered multiple regions, including California. It utilizes its real-time electricity trading and control platform called Autobidder, enabling owners and operators to develop operational strategies that maximize revenue based on their business goals and risk preferences.
b. Market Mechanisms
The U.S. electricity market is highly developed, characterized by its high degree of marketization, diversification, and the application of technological innovations. The development of VPPs in the U.S. is a reflection of this market maturity. VPPs integrate distributed energy resources?to participate in both wholesale and retail electricity markets. This integration optimizes resource allocation and enhances energy utilization efficiency.
（3）China
a. Policy Guidance and Demonstration Projects
The Chinese government is actively promoting the construction and development of VPPs. Various departments, including the National Development and Reform Commission (NDRC) and the National Energy Administration (NEA), have introduced several policies to encourage VPP demonstration projects. For example, the "14th Five-Year Plan for Modern Energy System" aims to accumulate experience through these demonstration projects and explore VPP construction and development models suitable for China's national conditions.
In July 2024, China General Nuclear Power Group (CGN) launched the country's first fully green electricity supply VPP project at the Dongfang Cable Park in Ningbo, Zhejiang. This project utilizes a collaborative operation of various energy sources, including photovoltaic systems, energy storage, charging stations, and industrial loads, to enable intelligent switching based on real-time economic efficiency, thereby enhancing energy utilization and cost-effectiveness.
b. Technological Innovation and Application
China has made significant advancements in the technology of VPPs. By leveraging advanced Internet of Things (IoT) technology, VPPs can now perceive and monitor the status and operational data of distributed energy resources (DERs)?such as wind power, photovoltaics, energy storage systems, controllable loads, and electric vehicles in real-time. Big data technology?provides VPPs with powerful data processing and analytical capabilities, enabling them to collect, store, process, and analyze large volumes of data. This allows VPPs to uncover operational patterns and potential value within distributed resources.?Artificial intelligence (AI)?is applied in VPPs mainly in areas such as intelligent scheduling, optimization control, and decision support. Through the use of machine learning and deep learning, VPPs can intelligently identify and categorize distributed resources, and formulate optimal scheduling strategies and control schemes.?Technological innovation gives VPPs a greater advantage in providing reliable and flexible power supply or regulation capabilities.
（4）Other Countries
a. Japan
Japan's VPPs focus on new energy storage solutions and optimize energy allocation to create win-win situations. The diverse electricity market provides various revenue models for VPPs.
b. European Countries
Some?European countries, such as the United Kingdom and France, are also actively advancing VPP development by implementing relevant policies and establishing market mechanisms to promote VPP deployment and application.
In summary, the implementation of VPPs in various countries has unique characteristics but relies on multifaceted support, including policy guidance, market mechanisms, technological innovation, and commercial operation. As global energy transformation accelerates and electricity markets continue to improve, VPPs are expected to see broader application and development in more countries and regions.