Ausgrid seeks to expand virtual power plant to cut back on network costs

Ausgrid is seeking proposals to expand its virtual power plant, following the success of a pilot project that looked to co-ordinate battery storage systems to support network services and help avoid the need for further network investment.

Virtual power plants have emerged as an effective way to maximise the value of solar generation and the ability to dispatch energy stored in battery systems at optimum times to support the wider grid.

A virtual power plants allows for many battery systems to be aggregated and controlled as through they were one single, larger, storage system, providing an effective mechanism for demand response and a source of additional capacity during times of high demand.

Ausgrid partnered with Reposit Power to undertake the first stage pilot of a Virtual Power Plant, with hundreds of customers participating to deliver up to 1MW of coordinated demand and supply response.

Following the success of the pilot, Ausgrid is seeking to expand the VPP to other households, seeing greater value in with increasingly coordinated energy storage systems.

“For Ausgrid, VPPs might provide a reliable and cost competitive source of short duration demand reductions or voltage and frequency support services to avoid or defer network investment.” Ausgrid says in its request for proposals.

Ausgrid estimates that there are 4,000 to 5,000 behind the meter battery systems already on its network, along with an additional 120,000 premises with rooftop solar systems.

Throughout the two-year trial, Ausgrid will test the ability for a virtual power plant to address peak demand events, as well as maintaining voltage and frequency across the entirety its network.

Ausgrid will provide financial incentives for households participating in the trial and expects that it will deploy the VPP an average of 10-15 times per year.

In issuing the tender, Ausgrid has recognised the additional financial benefits that may be gained through the coordination of distributed energy systems, particularly battery storage systems that can be dispatched to meet periods of high demand.

Ausgrid recently launched a $4.1 million Power2U initiative, to work with its customers to permanently lower their energy use, with support provided to households to install rooftop solar on their homes, and install energy efficiency LED lights throughout their homes.

The Power2U project is supported by a $1 million grant from the Australian Renewable Energy Agency and by reducing overall energy consumption Ausgrid expects to avoid the need for further network investment in the future.

Through the use of a VPP, Ausgrid hopes to use stored energy in residential systems to meet system peak events, and address periods of supply constraints within the Ausgrid network, passing through the financial benefits to system owners.

“This is the first program of its type for Ausgrid. Solutions like a virtual power plant not only help customers, it helps the grid. If the trial is successful, it could provide a lower cost alternative to grid investment, which would result in lower customer bills in the long term.” Ausgrid CEO, Richard Gross said upon the launch of the first pilot.

The potential benefits for owners of residential energy systems was recognised by the Australian Energy Market Operator through the development of its own VPP Demonstrations Program, which will work with Government entities and utilities to trial VPPs throughout the NEM.

Ausgrid hopes to sign a contract with the VPP facilitator in the middle of the year, with the project commencing before the end of August.