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  • Writer's pictureDoug Hull

Virtual Power Plants - Is this the future?

I read some interesting comments today made by the CEO of the Australian Energy Market Commission, Ben Barr. In this article he is described as saying:

"... all governments support what he [Barr] describes as a profound shift – a recognition for the first time that electricity networks need to take power from houses, not just get it to them."

Wow! To me this effectively means that there is widespread acceptance that the days of big, centralised, government controlled, fossil fuel burning power stations are numbered, and we are moving into a new world where distributed power is key. That is huge!

This reminds me of Jeremy Rifkin's ideas about the Third Industrial Revolution, which focus on the proliferation of widespread free/cheap communications technology and distributed renewable energy networks, along with a 'sharing economy'. Just think what the world could look like with free or nearly-free energy and communications technology. Would there still be a place for big centralised corporations? I suspect not - I think distributed energy will equate to distributed (as opposed to centralised) business models. The mind boggles..

Coming back to present day, what does this actually mean to me right here, right now? Well there is a concept called the 'Virtual Power Plant' (VPP) which is being trialled by some energy providers in Australia. In Western Australia there are plenty of homes with solar panels that all sell electricity back to the grid when the sun is shining, however in the absence of storage facilities there is little capacity to store the energy and sell it back to the grid during peak times, which are typically after sunset. A VPP is a system where homes with battery storage (this could include electric vehicles) can sell electricity back to the grid at these peak usage times. This sounds like a no-brainer, however the current limitation is that there is a significant cost to batteries which is probably why they are not common-place in Australian households. I believe that the buy-back rates will be higher for selling power during peak times, which will help to offset the high cost of installing battery arrays to some degree, however they are still costly. Battery technology is also evolving rapidly, which means we may see cheaper, more effective, and (hopefully!) more environmentally friendly battery types emerging over the next 5-10 years. At some point in the near future batteries will definitely be a no-brainer for anybody with solar panels on their roof.

For me personally, I decided not to install any batteries linked to my solar panels YET, however I have purchased a system that will support batteries being added at a later stage. I have no doubt that this is the future and am excited to see how the VPP trials progress.

Until next time!


aka The Regeneralist

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