Amid the global energy crisis, household solar and battery installations are forming virtual power plants, stabilizing electricity grids. We explore Australia’s approach and its potential impact on South Africa.
South Africa’s frustration with its national energy supplier, Eskom, and rolling blackouts is not unique, as power outages have been a global challenge, from Europe’s Kosovo to Asia’s Sri Lanka and the Caribbean’s Cuba.
At a global energy forum in Sydney, Australia, in July 2022, Fatih Birol, the head of the International Energy Agency (IEA), emphasized the unprecedented depth and complexity of the current energy crisis, impacting the entire world.
While many governments struggle with rising demand and inadequate electricity supply, some countries have faced energy challenges for years. South Africa is pivotal in its energy landscape, presenting an opportunity for a transformative revolution.
Virtual Power Plants (VPPs) are key to moving away from recurrent Stage 6 load shedding and towards a future with abundant and accessible energy.
In this article, we explore the concept of VPPs and examine how countries like Australia have already embraced this innovative technology. The potential benefits of VPPs for South Africa’s economy, environment, and society are substantial, making it a crucial avenue to explore a more sustainable energy future.
What are Virtual Power Plants?
A network of small energy-producing or storage devices, like solar panels and batteries, that are pooled together to serve the electricity grid, VPPs have become a crucial response to the ongoing global energy crisis. The popularity of solar panels and home batteries has skyrocketed, offering consumers carbon-free power generation and significant savings on electricity bills.
Through aggregating hundreds or thousands of these devices, VPPs play a pivotal role as a flexible and critical tool. They can supply substantial power during periods of grid strain or store excess energy generated by solar and wind sources. By functioning in this manner, VPPs are at the forefront of reducing the power industry’s reliance on fossil fuels, aligning with the transition towards electrifying transportation, buildings, and industrial sectors.
The potential for VPPs is substantial, with significant growth anticipated in the United States, supported by President Joe Biden’s new climate change law that includes incentives for electric cars, solar panels, and home batteries. However, countries like Australia have already embraced the green energy solution, recognizing its benefits to the energy landscape.
A noteworthy aspect of VPPs is the shift in consumer dynamics. As EIT Academic Board Deputy Chair Professor Akhtar Kalam pointed out in his recent webinar on Data-Centric Evolving Power Grids: “Customers are no longer passive consumers but have become “prosumers,” actively producing electricity for themselves and even selling excess energy back to the grid.
This transformation in consumer participation can reshape the energy grid and foster a more sustainable and dynamic energy future.
Are Virtual Power Plants Popular in Australia?
Australia has established itself as a global leader in rooftop solar installations, boasting over 2.5 million systems with a combined capacity exceeding 10 GW. Additionally, the rapid growth of home batteries is evident, with more than 73,000 systems now storing nearly 1.1 GW of power.
This surge in solar energy capacity is remarkable, exceeding the former Hazelwood power station’s (in the Latrobe Valley in Victoria, Australia) capacity by over eight times and the Liddell power station’s (in New South Wales, Australia) capacity by four times. However, one of the challenges of relying on solar power is its inability to generate electricity at night and its variability due to weather conditions.
Network operators seek innovative solutions to address this variability and maintain a stable grid with renewable energy. VPPs have emerged as a crucial component in the energy mix, harnessing the collective power of Australia’s behind-the-meter energy assets.
These VPPs are pivotal in balancing the grid and ensuring power availability whenever needed, contributing to Australia’s more reliable and sustainable energy future.
How do Virtual Power Plants Work?
Virtual power plants are vital in integrating renewable energy into the grid while ensuring grid stability. VPPs facilitate the rapid injection of renewable energy into the grid by aggregating thousands of home batteries. This process helps address frequency and voltage imbalances, as well as local disruptions or disturbances, contributing to the overall stability of the energy network.
The implementation of VPP technology is gaining momentum across Australia, with nationwide initiatives supported by the Australian Renewable Energy Agency (ARENA). Prominent projects, such as AEMO’s demonstration and Tesla’s South Australian VPP, showcase the efficacy of VPPs in the energy landscape.
Operators can remotely access and deploy energy stored in participating households’ batteries through these projects. This agility allows them to respond swiftly to energy shortfalls or spikes in demand, ensuring a continuous and reliable power supply. Additionally, VPPs offer ancillary services such as frequency control, which helps maintain the grid’s stability even during fluctuating energy conditions.
For participating households, the benefits extend beyond contributing to a greener energy future. They are rewarded for involvement in the VPP ecosystem, usually through direct payments or bill credits. This incentivizes more homeowners to join VPP programs, further bolstering the network’s capacity and sustainability.
In summary, VPPs enable seamless integration of renewable energy into the grid, addressing grid imbalances and disruptions while providing ancillary services. The widespread rollout of ARENA-supported VPP projects exemplifies their potential to revolutionize the energy landscape, benefiting both homeowners and the larger energy network.
The Role of Solar Power in South Africa
Regrettably, South Africa’s current renewable energy generation contributes only 1.4% to its total power output. Despite being a leader in renewable energy production in Africa, there are still untapped renewable sources that hold great potential for bolstering South African energy supplies:
Hydropower: South Africa’s combined hydropower stations produce approximately 3147 GWh (1.4%) annually. However, this sector has reached about 90% development, leaving limited room for further expansion.
Solar Energy: South Africa boasts an average solar radiation of around 220 W/m2 per day, surpassing Europe’s 100 W/m2. This high solar capability makes it one of the world’s most promising solar energy markets.
Solar Home Systems: The popularity of home solar systems has surged in South Africa since the early 2000s. Reduced product costs and unreliable electricity provision have significantly contributed to this growth.
Concentrated Solar Power: Concentrated solar power plants utilize thermal energy storage systems, concentrating available solar energy. These plants prove particularly valuable in generating energy during subpar weather conditions, like cloudy days or periods without sunlight.
Embracing greater renewable energy utilization would reduce South Africa’s economic vulnerability to fluctuating fuel costs and propel the country’s transition to a sustainable energy future. Solar power is poised to play a massive role in this transformation, offering numerous benefits such as:
- Substantial savings on electricity bills and environmental preservation.
- Improved health and a brighter future for the population.
- Conservation of depleting natural resources.
- Job creation and a positive impact on the South African economy.
- Enhanced energy security and stability in energy prices.
- Lower maintenance requirements, fostering long-term sustainability.
Integrating renewable energy, especially solar power, is key to a more resilient and sustainable energy landscape for South Africa.
The Future Could be Brighter…if
Virtual Power Plants could help reshape South Africa’s energy landscape and that of other nations and pave the way toward a sustainable future.
By embracing this innovative concept and harnessing the power of solar energy, countries buckling under persistent energy shortfalls could move towards greater energy security, economic stability, and environmental preservation.
References
We are not alone — energy crises are a growing global phenomenon
What are virtual power plants and why do they matter?
Explainer: What is a virtual power plant?
Powering the Future: The Potential of Virtual Power Plants in South Africa
Importance of Renewable Energy in South Africa
