Post: DOE releases Virtual Power Plants liftoff report

DOE releases Virtual Power Plants liftoff report

DOE has released its Virtual Power Plants Liftoff report. With electricity demand growing for the first time in a decade and fossil assets retiring, deploying 80-160 GW of virtual power plants (VPPs)—tripling current scale—by 2030 could support rapid electrification while redirecting grid spending from peaker plants to participants and reducing overall grid costs.

Between 2023 and 2030, the US will need to add enough new power generation capacity to supply over 200 GW of peak demand; were the US to follow a path towards 100% clean electricity by 2035, new capacity needs could nearly double. In all scenarios, the mix of weather-dependent renewable generation will be unprecedented, leading to more variable electricity supply and higher demand for transmission capacity. Transmission interconnection backlogs, which have stretched to an average of five years, pose potential resource adequacy challenges. Large-scale deployment of VPPs could help address demand increases and rising peaks at lower cost than conventional resources, reducing the energy costs for Americans – one in six of whom are already behind on electricity bills.

The report, published on September 18, found that as demand grows and traditional energy sources like coal and gas phase out, VPPs are at a crucial juncture. Deploying 80-160GW of VPPs by 2030 to help address national capacity needs could save on the order of $10B in annual grid costs and will direct grid spending back to electricity consumers. At this scale, VPPs could contribute approximately 10%-20% of peak demand. But to realize their full potential, VPPs require scalable models, regulatory support, and a broad coalition of stakeholders engaged in their development and deployment.

GridBeyond Chief Product Officer and President North America Sean McEvoy welcomed the report and said: