Australia is a land of sunshine, so it’s no wonder that households across the country have installed solar power on their rooftops in large numbers.
And increasingly, people are investing in batteries to store their solar energy for use on cloudy days, or overnight when the sun isn’t shining.
This creates the opportunity to embrace a new way of distributing energy – something called a ‘virtual power plant’ (VPP).
To the uninitiated, it can sound complex and strange. But if you’re interested in investing in solar battery storage and gaining the energy independence and sustainability that comes with it, a virtual power plant could create even more benefits for you.
Luckily, learning more about VPPs doesn’t require hours of study. We’ve broken the basics down using six key questions.
- So, what is a virtual power plant?
A virtual power plant is the ‘people power’ of energy. It’s a community approach to generating and distributing electricity – much like when everyone brings a plate to a BBQ, a virtual power plant allows many separate households to share the energy they’ve generated from their solar storage systems.
Virtual power plants use software to join up these different storage systems, sending their collective energy into the grid during times of peak demand.
This is a different model to the traditional one-way approach of generating energy in Australia, where electricity is sent from large power generators to individual households.
With the introduction of privately owned solar panels, a two-way electricity supply began – from the grid into households, and from households into the grid. Virtual power plants allow us to take this two-way energy flow to the next level by using battery storage to provide more regular access to solar energy.
- Why is a virtual power plant important?
Most of the time there is enough electricity for everybody. But sometimes the grid is stretched to its limits when demand is really high – like when the temperature soars and everyone switches on their air conditioning, or there is a disruption in supply.
This puts pressure on the grid to meet the increased need for power, and it’s where a virtual power plant can help.
Virtual power plants allow renewable energy to be harnessed quickly, keeping the network stable and reducing reliance on fossil fuels.
- What type of VPP is right for me?
There are a variety of virtual power plant programs in Australia, and every program will be different depending on the provider. It’s worth considering which of these two approaches suits you:
- A virtual power plant package program which can help you with setting up solar and battery. This is great if you’re new to solar energy and looking for help with selecting and installing an energy system.
Our Solar Home Bundle is a perfect example – you can get solar and battery installed and managed for the price of an energy plan, with no upfront cost. The system is yours after the seven-year contract term and you’ll be a part of EnergyAustralia’s PowerResponse Virtual Power Plant program once the solar and battery is installed and commissioned. Check out this offer and eligibility criteria - note it’s currently available to eligible NSW residential customers only.
- A virtual power plant program which lets you ‘bring your own battery’. This is a good option if you’re confident in researching and organising the installation of your solar and battery system, or if you’ve already got one installed and want a way to earn more money from your investment.
Our PowerResponse Virtual Power Plant is available to households who already have a compatible battery installed – learn more about the program.
- What are the benefits of joining a virtual power plant?
Depending on the type of virtual power plant program you sign up to, there are often opportunities to earn money or enjoy other benefits. This may include things like regular payments, credits on your electricity bill or the chance to have solar and battery installed as part of a packaged deal.
All virtual power plant providers will have a different approach to how they reward participants, and this may depend on how many times they use the power in your battery. If you ‘bring your own battery’, our PowerResponse Virtual Power Plant program provides you with a fixed payment per month – whether we access the stored energy in your battery or not.
There are non-monetary perks to being part of a VPP too. You’ll play a part in making the energy grid more stable, helping to prevent black outs and power shortages.
And importantly, you’ll be adding more renewables to the national energy market, creating a more modern and sustainable electricity grid. That means you’ll be a part of the future of energy in Australia.
- What are ‘events’?
Many virtual power plants use something called an ‘event’ to describe the period of time where a virtual power plant provider accesses your battery.
Events give your VPP provider the option to use your battery to send energy to the grid, to charge it, or to keep it idle. The aim is to close the gap between supply and demand in the national electricity market.
Virtual power plant providers all have different approaches for managing events, including how they are run and how they communicate about them.
With our PowerResponse Virtual Power Plant program, energy generated by your solar system will always be consumed by your home first before any excess is exported to the grid.
Where there isn’t enough excess energy, we may charge your battery prior to the event so we can use its stored power during the event.
Your device is programmed to retain a minimum charge of 20% to maintain the battery’s power supply for short periods in case of a local blackout, and to allow the system to continue to operate after the event.
We also send you an SMS the next business day after we’ve accessed your system to confirm that an event occurred where we remotely managed your energy storage system.
- What do I need to do as a VPP participant?
When you join a virtual power plant, the most valuable thing you bring is the stored power in your battery and the ability for your VPP provider to access it when they need to.
And while it depends on the program, typically there’s not a lot you need to do after you’ve joined a virtual power plant.
For example, with our PowerResponse Virtual Power Plant, you won't need to install any additional hardware provided you have a compatible battery or inverter.
You also don't need to take any action during an event – apart from ensuring that your energy storage system is still connected to the internet, which is part of its normal daily operation.
Being part of a virtual power plant is usually as simple as signing up.