The term “virtual power plant” (VPP) is often misused because it can refer to a variety of different energy management systems, and there is no universally accepted definition of the term. As a result, the term can be applied to a range of different technologies and business models that vary widely in their design, capabilities, and objectives.
One common misconception about virtual power plants is that they involve physically connecting distributed energy resources (DERs) such as rooftop solar panels and battery storage systems to a central control system. While some VPPs do use this approach, others rely on cloud-based software platforms that aggregate DERs remotely and manage them through digital communication networks.
Another source of confusion is the distinction between VPPs and other types of energy management systems, such as microgrids and demand response programs. While there is some overlap between these concepts, each has its own unique characteristics and objectives.
Finally, the term “virtual power plant” can also be misused in marketing and advertising to promote energy management solutions that do not meet the technical requirements or functionality of a true VPP. This can create confusion and lead to unrealistic expectations about the capabilities and benefits of these systems.
The lack of a clear and consistent definition of the term “virtual power plant” provides for universal confusion when it comes to the simple concept of optimising use cases for DERs.
PowerSync Technologies’ platform provides a simple solution – we optimise site-based DERs and delivers available energy capacity into the most valuable energy market opportunity. We enable the asset to operate optimally at the site as well as in a host of energy markets where the capacity of these assets is valuable. Is it virtual? – ‘yes’ the process is a ‘virtual’ process – do we operate a ‘power plant’? – we operate an energy asset to emulate a power plant. You decide!