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#Discussion(General) [ via IoTForIndiaGroup ]
In this second article on distributed energy resource (DER) management solutions I’d like to tackle the topic of virtual power plant (VPP) vs. distributed energy resource management system (DERMS) solutions. I’ve heard a fair amount of debate on this topic recently and although I think it’s important to understand the current positioning I also believe that the commonalities will outnumber the differences in the not too distant future.
According to the IEEE a virtual power plant is a cluster of dispersed generator units, controllable loads and storage systems, aggregated in order to operate as a unique power plant. A VPP solution is a type of DER management solution that enables the creation and operation of VPPs by remotely and automatically dispatching retail DER services to a distribution or wholesale market via an aggregation and optimization platform (shout out to Peter Asmus of Navigant Research). According to SEPA a DERMS is a hardware and software platform to monitor and control distributed energy resources in a manner that maintains or improves the reliability, efficiency, and overall performance of the electric distribution system.
The VPP market is larger, more mature, and is transitioning from single asset (either demand response or supply side) to mixed asset deployments. The DERMS market is smaller, more nascent and is expected to be dominated by pilot projects through 2020. Both markets however are exhibiting high growth rates in excess of 20% CAGR.
VPP and DERMS solutions share some common capabilities such as DER registration, aggregation, forecasting, real-time monitoring and control, optimization and dispatch. However, beyond these common capabilities VPP solutions uniquely provide capabilities for market participation (bidding, communication) and commercial settlement (verification, billing) whereas DERMS solutions uniquely provide capabilities for Volt/VAR optimization (VVO) and active power management.
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