Virtual Power Plants
FAQ
This FAQ explains the fundamentals of Virtual Power Plants (VPPs), how they work and the benefits they provide for businesses and the grid. Learn about the technologies behind VPPs, the types of energy resources included and how organizations can participate to optimize energy use, earn incentives and support grid reliability.
Basics of Virtual Power Plants
What is a Virtual Power Plant (VPP)?
A VPP is a network of decentralized energy resources -like flexible loads, generators, battery storage systems and smart thermostats – that are connected, managed and dispatched via advanced software and controls, delivering revenue to customers based on the amount of energy reduction achieved.
How does a VPP work?
VPPs use advanced software to coordinate and control distributed energy resources, responding to grid and market signals in real time.
What types of energy sources are included in a VPP?
VPPs can include distributed generation such as battery storage, microgrids, backup generators and flexible loads such as HVAC systems, industrial operations and non-essential lighting).
What is the difference between a VPP and a traditional power plant?
Traditional plants are centralized and generate power at a single site, while VPPs aggregate distributed resources.
Who offers virtual power plant platforms?
CPower Energy is a leading Virtual Power Plant platform, monetizing the value of customer-sited energy to intelligently strengthen the grid. For over a decade, we have made turning flexible energy into revenue simple for partners and large energy users such as businesses, manufacturers, public institutions and healthcare organizations, paying over $1.2 billion from demand response and energy flexibility programs to customers since 2015. With 6.7 GW of customer capacity at more than 23,000 sites, we’re empowering energy users across North America, enabling them to benefit from an innovative energy economy. For more information, visit: www.cpowerenergy.com.
Benefits of VPPs
How can VPPs help businesses save on energy costs?
By optimizing energy use, participating in energy markets and earning incentives for grid support.
What are the environmental benefits of VPPs?
When electricity demand on the grid is high, peaker plants are turned on to meet demand. By leveraging customer-sited energy assets that are already available, we can make better use of grid infrastructure by reducing the need to turn on these high polluting fossil-fueled plants. Demand response support greater deployments of renewables by filling gaps in intermittent generation, versus building new generation capacity.
How do VPPs improve grid reliability and stability?
By providing flexible resources that can quickly respond to evolving grid dynamics by providing support for capacity, energy, ancillary services and on-bill programs.
Can VPPs help prevent blackouts or energy shortages?
CPower reduces the chance of brownouts and blackouts, acting as a supply-side flexible resource for capacity, energy and ancillary services, peak demand management programs and more.
Who benefits most from VPP participation?
Energy flexibility often guarantees a fixed payment per kW for the participant. Following a test or grid event, demand response participants are rewarded based on the amount of energy reduction achieved.
Participation and Implementation
How can a business or facility join a VPP program?
By enrolling with a VPP provider and connecting eligible assets.
Are there incentives or compensation for participating in a VPP?
VPPs often guarantee a fixed payment per kW for the participant. Following a test or grid event, demand response participants are rewarded based on the amount of energy reduction achieved.
What types of industries are suitable for VPP participation?
Manufacturing, commercial real estate, education, healthcare and more.
How long does it take to implement a VPP solution?
Implementation timelines vary but can often be completed in weeks to a few months.