Emerging technology of Virtual Power Plants can be 'hugely relevant' to Indian planners

By Shankar Sharma* 
There is a need to highlight few recent developments in the power sector, which should be of huge relevance to Indian scenario, provided the concerned authorities are serious about the same.
In the overall context that the Union govt. is planning to set up 18,000 MW of pumped storage plants (PSPs) by 2032, and in the context of unacceptable and entirely avoidable and huge societal level costs of the same, the concept of Virtual Power Plants (VPP), and another development that eight hour big battery storage system can trump pumped hydro in New South Wales (Australia) long duration storage tender should have huge relevance to our power system.
A fast emerging technology in the power sector "Virtual Power Plants" (VPP) should be of huge relevance to our planners. At a high level it can be credibly stated that an effective deployment of this technology can bring down the societal level costs (associated with conventional technology power plants, large size RE power parks, associated infrastructure etc.) by a considerable margin, while reducing the causes/ factors which are aggravating the phenomenon of Climate Change.
A huge concern with the existing power sector scenario of dozens of large size power plants, complicated networks of widely distributed loads and sources, the associated pressure on natural resources and pollution/ contamination etc. is the credibly projected calamities from climate change.
An increasingly attractive solution for this unsustainable scenario should be the technology of VPPs, consisting of a very large number of small size renewable energy sources, distributed loads, energy storage batteries (including small size energy storage batteries at residences, commercial establishments, industries, vehicles etc), which are electrically connected to each other, and effectively balanced by suitably designed control and communication systems.
An associated news article says: "Instead of a few large power plants, numerous small electricity producers will take over our energy supply in the future: from solar and wind power plants to biogas and hydroelectric assets. This multitude of decentralized energy resources (DER) must be intelligently coordinated to ensure a reliable energy supply. "
It is also reported that: "Several countries have increased the deployment of VPPs. One notable example is a VPP operated by Next Kraftwerke in Germany, with 5,000 energy-producing units and a total energy capacity of more than 4,000 MW. Successful pilots have also been set up in Australia, the United States, Denmark and Japan, with more research being underway. India is exploring VPP development and has pilot projects underway by Tata Power ."
It must be highlighted here that the case of a VPP operated by Next Kraftwerke in Germany, as in the link above, with 5,000 energy-producing units and a total power capacity of more than 4,000 MW, is larger in size than most districts and even many electricity utilities in our country.
In the larger context of the escalating demand for electricity and the fast depleting natural resource base in our country, which are already under unsustainable pressure (such as ever escalating demand on forest & agricultural lands; fresh water sources; disappearing reserves of minerals such as coal/ iron/ copper/ aluminium; pollution/ contamination of land, air and water etc,), a diligent planning and implementation of the the concept of VPPs in our electricity demand/ supply scenario can revolutionise the entire power sector taking it towards a sustainable, affordable and people friendly solution to our energy needs.
In the context that our authorities seem to be obsessed with building scores of pumped storage plants (PSPs) at humongous cost to the larger society, a recent development from Australia, as in the link below, wherein an eight hour battery energy storage system has been offered in a tender, should indicate the techno-economic feasibility of battery energy storage systems as a much benign and attractive option than the pumped storage plants (PSPs).
If suitable modifications to the operational regime (such as shifting many kinds of the peak hour loads to sunshine hours in a day, and meeting many kinds of demands through isolated RE sources etc.) are also implemented to minimise the peak hour demand, the very need for additional PSPs, which are certain to lead to irreversible damage to natural resource base in the country, can be eliminated/ minimised.
A very low price offered for a wind and solar power tender in Australia is also clearly indicative of the enormous costs to our society from the ongoing policy of pouring our meagre resources in building conventional technology and large size RE power plants and the associated infrastructure.
It is not known to civil society in the country as to how much effort and resources are being provided in India in undertaking credible research and studies in such transformation of our power sector. It does not require rocket science to project that the future electricity demand/ supply scenario, certainly in the case of India, will be heavily influenced/ governed by the concept of VPPs, energy storage batteries, and micro/ smart grids.
It is also not known whether any of the central agencies such as CEA, PGCIL, POSOCO, or NITI Aayog are working on the associated studies. It will not be surprising if these agencies are not providing the necessary focus on the associated issues; because it is almost impossible to notice any strategic approach by most of our national level authorities in the energy sector. But such a scenario can be seen as ignoring the legitimate interest of our people.
When we also objectively consider the combined energy storage capacity of a very large number of energy storage batteries, which will be available in different segments of our society (residences, commercial and industrial establishments, small/ large vehicles, grid scale batteries etc.), the potential to eliminate the very need for PSPs (and even many hydel power plants) while satisfactorily meeting most, if not all, the legitimate demand for electricity in our country through the techno-economically viable model of VPPs can be stated to be immense.

Large number of energy cooperatives are being satisfactorily run in Germany on VPP and smart grid mode

Hence, all the associated feasible and credible studies by the concerned agencies should be treated as critical to our country. If priority is also provided for maximising benefits from highest levels of energy efficiency (through measures such as demand side management and energy conservation), the reliance on fossil fuel power plants can be eliminated much before the net-zero carbon target of 2070, while massively reducing the need for dam based hydel power plants and nuclear power plants.

The most troubling question in this regard is whether our authorities are really serious about minimising the country's energy related GHG emissions at an early date, and also in adequately safeguarding our natural resources. In this regard, various policies/ practices and official statements emanating during the last few years have not provided any sort of assurance to our people.

It should also be highlighted here that a large number of energy cooperatives are being satisfactorily run in Germany (more than 900 in number) on such a principle/ technology (VPPs and smart grid mode), and hence, can be a good model to study from India's perspective. It is reported that successful pilots for VPPs have also been set up in Australia, the United States, Denmark and Japan, with more research being underway. There is a critical need for India to undertake the associated research with all the seriousness the technology deserves.
At the top of our societal concerns, in the prevailing scenario of demand/ supply of electricity in the country, is the escalating and unacceptable direct/ indirect costs to the society. It is unfortunate that the concerned authorities at the national level have not provided any indication of objectively considering adopting a better model of demand/ supply of electricity in the country.
Will it be too much for our people to expect that a substantial portion of the $1 trillion proposed to be spent by our country to comply with climate change norms (as mentioned in a newslink below), will be effectively dedicated to the associated research, studies and implementation activities in critical areas of power sector so as to eliminate/ minimise the destruction of forest & agricultural lands, felling of roadside trees, protection of fresh water bodies, minimising the pollution/ contamination of air, water and soil?
Without such transparent and cohesive policy on spending such a large amount, one may wonder as to where all this money will go to. Can we hope to see a considerable increase in natural forest cover, an increase in water holding capacities of fresh water bodies, and that the pollution/ contamination of air, water and soil will come down substantially by 2030? Without such unambiguous indicators of effectiveness of the intended measures, the target to spend such a large amount may not mean much to our people.
Only a diligently prepared national energy policy for the next 3-4 decades, with effective participation by all the interested sections of civil society, can address many such ongoing concerns to our people.
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*Power & climate policy analyst. This article is based on the author’s representation to RK Singh, Union Minister for Power & NRE, Government of India