Virtual Power Plants

With all the talk of electric cars I seem to be doing I thought it was a good opportunity to talk about a quiet revolution taking place which will affect all our lives in the coming years. The rise of electric cars has had a profound impact on the performance and cost of batteries. As businesses and governments plough billions into new ‘giga factories’, one of the major beneficiaries will be our homes. Let me explain.

As the cost of wind and solar technology drops it makes sense when renovating or building a new property to invest into green technology and generating electricity locally. Despite the government pulling the plug on incentives to install this technology, the benefits of fitting remain. In some instances, planning departments are making it prerequisite for consent to be granted that solar, or less commonly wind technology, is used to reduce the carbon impact of the new home or business premise. The problem with this technology is that whilst it thrives on a long summers day, when you get home from work in the dark and turn on your kettle, the energy you will be consuming will most likely be nuclear or gas.

To get around this, companies such as Tesla and Sonnen have been producing batteries for the home which store energy locally, enabling the consumer to use it when its needed rather than losing it to the National Grid. This storage is critical to making renewable generation work and as Boris Johnson recently announced, government ambition is to make renewable energy cover 100% of the UK population by 2030. This ambition is only realised with suitable storage and hence the Virtual Power Plant might just be the answer.

As electricity is generated it needs to be used there and then. The National Grid therefore has the unenviable task of trying to satisfy the balance of generation versus demand. Too little energy and our lights go out and too much and we waste huge amounts of resources and money. As the cost of building large green installation reduce, the national generation of wind and solar have made huge gains but it is still a time sensitive offering. As Australia is finding, when the sun comes up huge amounts of energy from home solar installations floods the grid at a time when consumption levels are low. A perfect opportunity for a home battery to soak up the oversupply and then let consumers benefit from it later in the day when generation levels are a lot lower.

This process is exactly the same when we look at the National Grid and I am pleased to see companies like Tesla are now looking to launch their very own Virtual Power Station. Thousands, and in time, millions of home installed batteries will be pooled to take up excess energy not only from the household but also generated by offshore windfarms to then give it back to the grid (and the home) when demand grows. Working in partnership with Octopus energy, they are hoping bills are dramatically reduced as consumers gain an income for storing the grids energy. Owners will also pay a reduced rate for energy they subsequently buy back later.

Sonnen, a German home battery supplier, has gone one step further and before Tesla may I add. They have created the SonnenCommunity which currently covers Austria, Germany, Switzerland and Italy and enables the sharing of energy not only with other homes in the community but also back to the regional national grids. This means when the National Grid has a demand for energy they can call on Sonnen’s Virtual Power Station to supply immediate energy from all over these countries immediately. Because the energy is shared it means no individual home loses all their stored energy, and with Sonnen running the program, homes can quickly receive payments for the energy they have given. They have even launched a product called SonnenFlat which looks to go one step further than Tesla by offering a zero cost tariff on the basis that your Sonnen at home will support the grid. Hence along with your own energy creation you will not pay for energy you need to consume over and above your own generation ability. By enabling all these batteries to absorb energy from the grid when there are high levels of generation, like during a storm, it means that this energy isn’t wasted.

There is some fascinating technology being developed at the moment for grid level power storage. Liquid air for example, which is being tested in the UK by Highview, turns ambient air into super cold (-196 degrees) liquid air which can be stored for long periods of time. Quickly, and when required, the process can be reversed, releasing a vast proportion of the stored energy back into the grid.

While this technology and others like it seem to be making big inroads, the simplicity of a decentralised energy grid, where thousands of homes have batteries storing relatively small amounts of energy, seems the most exciting at really making a difference to how we will store and consume energy on a national level. The future is already the Virtual Power Plant.

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.