Virtual Power Plants and Integrated Energy System: Current Status and Future Prospects

Abstract

The power system is undergoing a digitalization, decarbonization, and decentralization. Economic incentives along with resiliency and reliability concerns are partly driving the transition. In the process of decentralization, local energy markets are forming at various places. A virtual power plant (VPP) is a by-product of this digitalization capitalizing on the opportunity to further promote renewable resources, demand-side flexibility, and sector coupling. A VPP enables resilient operation of power system while assembling small- to large-scale generation units and demand-side flexibility. Specifically, during the pandemic uncertainty, virtual work meets virtual power plants. A VPP has two both cyber and physical components. On one side, the physical component presents the operational challenges in terms of security, stability, reliability, and efficiency. On the other side, the cyber component introduces the challenges on communication, computation, security, and privacy. A VPP synthesizes synergies between the cyber and physical components, thereby harnessing the potential in terms of enhancing energy efficiency and reducing the cost. The objective of this chapter is to introduce the virtual power plant and integrated energy system with associated concepts, terminology, and relation thereof. The secondary objective is to categorize the key concepts while highlighting subsequent issues in planning, operations, and control of a VPP with an integrated energy system. Moreover, this chapter knits together the concepts and challenges in realizing virtual power plants with integrated energy systems.