The virtual power plant that Musk is optimistic about has become popular in China: related concept stocks have risen 50% in 4 months, and there are also pilot operations in cities

Pine Xiao Xiao comes from Aofei Temple
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The high temperature dried up a number of hydroelectric power stations, but it also brought the concept of " virtual power plant " back into the spotlight.

Not only are new virtual power plants being built or put into operation everywhere, but related concept stocks have also risen by 50%.

You know, just a month ago, Musk announced a virtual power plant project——

Tesla users who have their own "large energy storage battery" Powerwall at home have a good way to make money. If the user has endless electricity, they can earn two dollars per unit of electricity sent to the grid.

Related virtual power plants have already been put into operation in China. According to Sina Technology, many companies have now joined the ranks of "power supply" for virtual power plants. If you are active, you can even get hundreds of thousands of yuan a month.

It sounds like this virtual power plant can not only solve the problem of insufficient power supply, but also allow individuals or companies with surplus power to make money.

Is there such an easy and good thing?

So what exactly is a virtual power plant project, and why does it make money?

What exactly is a virtual power plant?

At first glance, many people might think of a virtual power plant as just a power plant.

But it's not, it's more like an energy management system .

The reason why it has the suffix of "power plant" is because it has the same function as a power plant - transmitting electric power resources . However, compared with traditional power plants, virtual power plants are more flexible when it comes to transmission.

How to be more “flexible”? In fact, the virtual power plant plays the role of a “dispatcher” in the whole process.

On the one hand, on the power supply side, it uses information technology to integrate various power generation and energy storage resources, including traditional thermal power systems, new energy power generation systems and some vehicle energy systems.

On the other hand, on the electricity consumption side, virtual power plants respond to flexible electricity demand in the market by allocating and optimizing integrated energy resources.

Among them, the virtual power plant will allocate electricity consumption during peak and off-peak periods to avoid electricity shortages and play a role of "peak shaving and valley filling".

To put it simply, we provide users with exactly the amount of electricity they need (and any excess will be given to others) , and we give corresponding electricity usage recommendations based on the overall power generation and consumption conditions.

△ Image source: Zhong Yongjie, Ji Ling, Li Jingxia, etc. Overview of the basic characteristics and development status of virtual power plants

It is worth mentioning that according to the calculation of the State Grid, if traditional thermal power plants want to achieve "peak shaving and valley filling" in the power system, an investment of 400 billion yuan is required to reduce only about 5% of the system's peak load .

The same work can be done by a virtual power plant, which only costs 50 billion to 60 billion yuan, and the cost is less than 14.5% of that of a thermal power plant.

So how can a virtual power plant be realized, and what technologies are needed to support it?

Generally speaking, virtual power plants require three main technologies to support energy management systems: information and communication technology, smart metering technology, and coordinated control technology.

Information and communication technology is a key technology to achieve distributed energy aggregation , including 5G communication technology, high-speed carrier communication technology, etc.

Smart metering technology accurately measures distributed energy sources and lays a solid foundation for subsequent coordinated configuration.

Coordinated control technology can be regarded as the "last step" technology to realize the virtual power plant. Based on the analyzed data, the electric energy is output in the optimal configuration.

△ Image source: Science and Technology Innovation Board Daily

It doesn't sound complicated, but it is technically not that simple to realize a virtual power plant.

First of all , in terms of algorithms , virtual power plants need to schedule power resources based on various internal data to achieve optimal configuration, which will inevitably involve a series of optimization algorithms. Although there are already some optimization algorithms, they still need to be further explored. .

Then, according to the management of China Electric Power Enterprises, virtual power plants are bound to embark on the road of marketization in the future. In power market transactions, a point-to-point, safe, transparent and credible trading environment is crucial, and blockchain is exactly the solution to this problem. key.

However, there are still some technical bottlenecks to be overcome in the application of blockchain in virtual power plants. For example, in transaction scenarios involving a wide range, the performance of blockchain will drop sharply, and the confidentiality of blockchain will also bring certain difficulties to supervision.

Finally, let’s talk about the business model of the virtual power plant. Currently, there are two main sources of profit:

One is that the virtual power plant, as an electricity sales enterprise, directly trades with users; the other is peak shaving service transactions, that is, "peak shaving and valley filling". This kind of service that balances energy resources is generally called ancillary services .

At present, virtual power plants can be divided into four categories according to equipment type and profit model, namely power supply type, load type, energy storage type and hybrid type.

Power type Virtual power plants can trade directly with users and decide whether to provide auxiliary services based on the company's actual situation.

The main feature of a load-type virtual power plant is that it realizes profits by adjusting the power consumption of users and can provide auxiliary services, but it does not necessarily sell electricity directly to users.

Energy storage type Virtual power plants can participate in the ancillary service market and also make profits by acquiring and selling electricity.

Hybrid virtual power plants are “all-around” players.

△ Image source: Zhong Yongjie, Ji Ling, Li Jingxia, etc. Overview of the basic characteristics and development status of virtual power plants

So, what stage have the virtual power plants at home and abroad reached in their development?

At what stage has it developed at home and abroad?

Regarding the development of virtual power plants, there are currently companies abroad that have achieved profitability, but domestically, overall, they are still in the development stage.

Let’s first look at the situation abroad.

The concept of virtual power plant was first proposed by British scholar Shimon Awerbuch in 1997 and gradually became popular abroad more than ten years later.

The reasons for the popularity are slightly different: virtual power plants in Europe focus on "increasing revenue", that is, increasing the utilization rate of distributed power sources; in the United States they are closer to "saving money", that is, improving the energy utilization efficiency of various regions.

A typical virtual power plant company in Europe is Next Kraftwerke , a German virtual power plant operator established in 2009 .

In 2020 alone, the company's revenue reached 595 million euros , making it the largest virtual power plant operator in Germany. It has now been acquired by Shell.

Although this company manages more than 6,800 distributed power generation equipment and energy storage equipment, the average resource of a single customer is only 0.87MW. In other words, in addition to other profit models such as auxiliary services and the sale of new energy, it needs to rely on huge distribution resource scheduling capabilities to obtain profits.

Tesla is a representative of virtual power plants in the United States .

In 2015, Musk developed a home energy storage product called Powerwall. It is like a large battery that can store solar energy to provide daily power supply for users' homes.

In July this year, Tesla announced that it would cooperate with Pacific Gas and Electric Company PG&E to turn Powerwall into a distributed energy source. Users’ unused electricity can be transferred back to the grid and receive a reward of US$2 per kilowatt hour of electricity .

Although this virtual power plant project seems to have started late, Powerwall has a large user base. Soon after it went online, several thousand users signed up. Now it seems that Musk had "planned it long ago" (dog head).

The domestic start is slightly later.

In 2017, Shanghai built a commercial building virtual power plant demonstration project in Huangpu District, and Jiangsu's "source-grid-load smart grid" system for clean energy was also put into operation; in 2019, the Jibei virtual power plant in Hebei was put into operation...

It is expected that by 2025, Guangdong Shenzhen will also build a virtual power plant with an adjustable capacity of 1 million kilowatts, and gradually form a stable adjustment capacity of about 5% of the annual maximum load.

At present, there are many virtual power plant pilot projects put into use.

For example, State Grid Shanghai Pudong Power Supply Company has signed agreements based on virtual power plant applications with six household electricity customers including Shanghai Nordson Auto Parts Co., Ltd., and can "transform" into a virtual power plant at any time if conditions permit;

Jibei Company, which is listed as the unit responsible for the pilot project of virtual power plant demonstration by the State Grid Corporation of China, is responsible for the "virtual power plant" pilot project that has served the Beijing Winter Olympics .

In other words, friends participating in this year’s Winter Olympics may have already used the resources of virtual power plant dispatching.

△ Picture source: State Grid Jibei Electric Power

At present, the friendly interaction system between urban users and power grid supply and demand developed by State Grid Jiangsu Electric Power Co., Ltd. has also been applied to smart charging piles.

According to Ta Kung Pao, if the battery capacity of an electric car is about 60 kWh, the charging price can be reduced by 0.2 yuan per kilowatt-hour by using this smart charging pile. Charging for 4 hours only costs 48 yuan, which saves 12 yuan compared to usual.

However, whether domestic or foreign, virtual power plants face some unavoidable obstacles.

Profit issue. According to Jiazi Guangnian, the investment in the construction of the virtual power plant in northern Hebei is about 30 million yuan . In 2021, it will participate in peak and frequency regulation about 5-6 times a year, and the revenue for operators and users will be more than 6 million yuan. about.

Profit model issue. For example, many current virtual power plant projects still mainly rely on providing energy storage services to achieve added value. As for auxiliary services that save electricity, their appeal to customers is limited.

Information security issues. Virtual power plants actually rely heavily on algorithmic software for data collection and communication, but this also makes them vulnerable to cyberattacks.

According to Statkraft, a Norwegian company, cyber attacks are threatening the global energy grid, especially virtual power plants, which could have serious consequences if attacked, which could also affect customer trust.

If we can find a way to solve these problems, it will also help the development of virtual power plants.

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