Ventyx hosted a Webcast titled “How Virtual Power Plants can make Demand Response/Distributed Energy Resources more Viable” presented by Aaron Zuborg, Director of Smart Grid Strategy. The presentation provided some background on the smart grid and presented the concept of a Virtual Power Plant (VPP) that integrates distributed energy resources (DER) and demand response (DR) into a single system that operates like a generation asset to a utility.
Ventyx is a participant in Xcel Energy's SmartGridCity project.
According to Randy Huston, Xcel Energy's project delivery executive for SmartGridCity, "The [Ventyx Smart Grid Operations] solution transforms the data from an individual meter level to an aggregated level called Virtual Power Plants to support commercial operations of the grid, and takes the day-ahead/balance-of-day plans from operations and creates price signals that can be put onto the customer data portal for customer choice or price options. This capability connects the results of the demand response programs and distributed energy resources to our trading portfolio operations and investment decisions. As a result, the software will help us give SmartGridCity customers greater control over their energy consumption, while realizing the benefits of implementing a Smart Grid."
Background:
What infrastructure is needed for a Smart Grid? Devices and Communications. Tying it all together is a software layer to provide analytics:
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Why are we making the grid smarter? What are the potential benefits of the Smart Grid:
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What influences the market's decisions to engage in demand response and encourage distributed energy resources development? Most recent among these is "Bidding into ISO's" or greater DR solution demand by ISO's, largely due to legislation.
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What are some of the barriers to DR/DER:
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The Virtual Power Plant:
In a system with energy users participating in DR programs, and distributed energy resources, the virtual power plant works to aggregate all aspects to provide a single view to a utility.
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Many advantages to setting up a VPP to manage a set of resources:
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For the utility, the VPP compares well to a traditional generation plant:
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Thoughts & Analysis:
Ventyx's experience with SmartGridCity gives them great insight into the future of the grid and should provide them with an advantage when designing the software and analytics required to maximize the benefits realizable with a Smart Grid. SmartGridCity has the infrastructure required to effect a Smart Grid, ranging from the devices (meters, smart plugs, etc) to the communication network (utility <> meter <> appliances <> web). Once the infrastructure is in place, the three major issues appear to be:
1. How to make Demand Response real-time and most efficient?
2. How to maximize the economic benefits of distributed generation?
3. How to integrate with utility demand/supply?
The virtual power plant model sets up smaller systems in which these problems can be analyzed and solved, thereby saving the utility the effort. Once setup, it can efficiently bid into ISO's as any power supplier, either by supplying power generated by distributed energy resources, or by removing power use through demand response. In this way, the owners of energy-generating assets or energy-reducing response can sell their services on the market to the highest bidder, maximizing their value.
From the utility perspective, it has another source supply to rely on, thereby potentially reducing its costs to purchase supply. Additionally, controlling the output from the virtual power plant may prevent additional transmission/distribution development.
One concept, borrowed from
General Compression and their Compressed Air Energy Storage solution strategy, would be to add utility-scale storage in the VPP system to then provide a pre-determined schedule of supply to the utility to replace baseload if need be.
Jesse Berst from SmartGridNews has a couple of good articles on VPPs and what he's calling DR 2.0. A notable player entering this market is Schneider Electric, who sees offering these services as a channel to sell their energy efficiency products. The other logical candidates to provide VPP solutions are the current DR providers, who maybe viewed as technology/product agnostic when providing energy efficiency advice to energy-users, or smart grid solutions to utilities.
Smart Grid Demand Response: Schneider Electric Reveals Ambitious Plans to Create Virtual Power Plants
Smart Grid Demand Response: Why Today’s Leaders are at Risk as DR 2.0 Emerges
