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ESA: Virtual power plants could do ‘big things for the grid’ while boosting renewables

Seemingly missed or discounted by much of the media coverage of the Tesla / SolarCity tie in was the residential solar installer's announcement that it will use Tesla batteries to form aggregated systems. Image: SolarCity.
Aggregating connected energy storage systems to create ‘virtual power plants’ is likely to become a big part of the next phase of storage, according to the executive director of the US-based Energy Storage Association.

Matt Roberts of ESA told PV Tech Storage yesterday that Silicon Valley tech companies are poised to play a central role in the concept, which although in its infancy is being put through its paces in a number of trials.

ESA held its annual conference last week in Texas. Roberts said a panel discussion, which included a number of solar, storage integration companies and software makers such as Greensmith and Sunverge, saw the participants throwing ideas “back and forth”.

One such discussion centred on the idea of the virtual power plant (VPP), in other words, using smaller-scale energy storage systems connected together to make a larger distributed energy ‘asset’ that could perform a number of different tasks, such as grid balancing.

“Silicon Valley…is really poised to become part of storage in a big way,” Roberts said.

“Because if you’re a company and you’ve installed 10,000 systems, you can aggregate all those systems together and start using them to start bidding into the grid, making a couple of thousand dollars per megawatt.”

Teaching storage to multi-task

Part of the beauty is that this kind of storage-based ‘multi-tasking’ could be secondary to the main aims of the storage being installed, such as integrating solar.

“You don’t have to do it every day, but on an infrequent basis you can jump into the marketplace to help make money and subsidise all your projects. And, you can do big things for the grid. You will look like a power plant as far as the grid can tell. You can replace the need for a new peaking plant or something like that. [There are] a lot of great things you can do with distributed storage; the sum of [its] parts is greater than the individual pieces.”

Companies are already trialling the concept in various configurations around the world, analyst Omar Saadeh, senior grid analyst at GTM Research, told PV Tech Storage recently. Saadeh said VPPs are one way utilities could use storage to meet “a higher demand for rapidly deployable grid flexibility”.

One example Saadeh cited was a project called PowerShift Atalantic in Canada, which was “designed to manage and mitigate intermittent power from large-scale wind generation, currently totalling 822MW”.

“Through the multiple flexible curtailment service providers, aggregated loads have the ability to balance wind intermittency by responding to virtual power plant dispatch signals in near-real time, providing the equivalent of a 10-minute spinning reserve ancillary service typically executed by pollution-heavy peaker plants,” Saadeh said.

“Since March 2014, the project included 1,270 customer-connected devices with 18 MW of load flexibility, approximately 90% residential.”

Saadeh said Europe has been especially active on the concept, calling France one of the “leading supporters” of such developments.

“They’ve looked at many promising applications including partial islanding, or microgrids, DER-oriented marketplace development, and renewable balancing services.”

German utility Lichtblick, which claims to generate its power 100% from renewables, is another entity which has already got started on VPPs, which it calls a “swarm” of devices. Its battery system providers in VPP programmes include Tesla Energy and Germany’s Sonnenbatterie. Meanwhile another big Tesla partner, SolarCity, also intends to aggregate storage using the EV maker turned energy industry disruptor’s Powerwall for homes.

Enphase is among the other companies to have recently talked up the importance of accumulating vast reams of data to leveraged in more distributed energy networks. Image: Enphase.
Big Data and the challenge ahead

Solar industry veteran Jigar Shah, now head of Generate Capital, which provides investment for infrastructure projects, said the concept is all about Big Data and how to leverage it. Speaking to PV Tech Storage ahead of the ESA conference, Shah said that in theory, VPP’s could help solar inspire the paradigm shift of utility business models that he and other low carbon advocates have been working towards. He also agreed with Matt Robert’s contention that software will be a major aspect of that.

“I think that the underlying technology behind that [the VPP] is software, Big Data played around to aggregate many, many, smaller units. Whether you do that with refrigerators or water heaters, [or with] storage units, it is going to fundamentally change the way the electric utility is run.”

PV Tech Storage asked Shah if VPPs could also improve the business proposition of solar.

“I don’t think it’s just pairing solar with storage, its solar, storage, water heaters, refrigerators,” Shah said.

“I think the solar industry becomes a sort of Trojan Horse for the change that we’re looking for in the utility business model.”

Matt Roberts of ESA said that challenges remain, however. Roberts explained that with centralised generation from a coal plant, for example, utilities, wire companies and other stakeholders have an established understanding of how everything works, but that when it comes to energy from stationary storage, the picture is less clear as yet.

“It is one of those things where it’s not science fiction but there are a number of challenges,” Roberts said. “…the software that will be needed to drive that, is incredibly complicated - well not incredibly complicated - but involves a lot of redesign to accomplish that.”

The aggregated virtual power plant concept, including challenges and opportunities, will be examined in Volume 3 of the downstream solar industry journal PV Tech Power, to be launched next week at the Intersolar Europe trade exhibition and conference. It will be available to read online free of charge here (free subscription required). 

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