Insight into China’s virtual power plant industry in 2022 From 36 krypton Research Institute
The following is the Insight into China’s virtual power plant industry in 2022 From 36 krypton Research Institute recommended by recordtrend.com. And this article belongs to the classification: Strategic emerging industries.
Virtual power plant (VPP) is a kind of coordination management system that realizes the aggregation and collaborative optimization of distributed resources such as distributed power generation, energy storage and adjustable load through information technology and software system. As a special power plant, it participates in the operation of power market and power grid. It can not only be used as a “positive power plant” to supply power to the system for peak load regulation, but also as a “negative power plant” to increase load consumption and cooperate with the system to fill the valley. Under the background of the transformation of the power grid operation mode to the flexible interaction of source network load and storage and the transformation of the structure to clean and low-carbon, the vigorous development of virtual power plants is of great practical significance to promote the balance between supply and demand of the power grid, realize the low-cost grid connection of distributed energy, fully absorb the power generation capacity of clean energy and promote the transformation of green energy.
Development environment
Policy environment: the power market continues to open, providing strong support for virtual power plants to participate in transactions
The main function of the virtual power plant is to gather multiple types of energy to participate in the operation of the power market, and promote the optimal allocation of power resources by market means. In the early stage of China’s energy system, power generation, transmission and distribution, and power consumption are relatively independent and lack of a certain market interaction mechanism. Therefore, the construction and development of virtual power plants must be based on the relevant policy support issued by the government. In recent years, in order to adapt to the transformation of energy structure, the national development and Reform Commission and the national energy administration have issued a series of policies to promote the improvement of the national unified power market system, support the cultivation of diversified competitive market players, and encourage virtual power plants to participate in power market transactions and system operation regulation. Many policy documents such as the “14th five year plan” for modern energy system (fgny [2022] No. 210) have proposed that China will improve the construction and operation mechanism of new power system, improve the power grid system suitable for local deep utilization and wide area transmission of renewable energy, improve the market mechanism suitable for new power system, improve the construction and operation mechanism of flexible power supply, and carry out the demonstration of virtual power plants with various resources. At the same time, Zhejiang, Shanghai, Guangdong and other places also continue to explore how to actively respond to the demand for peak shaving and valley filling through virtual power plant projects to improve the operation efficiency of the power system. The successive introduction and implementation of national and local policies has provided a good policy environment for the construction and development of virtual power plants.
Technical environment: communication network support, emerging technology integration and application to improve the efficiency of virtual power plant
The key technologies of virtual power plants such as coordinated control, intelligent measurement and information communication have developed rapidly in China. Among them, communication technology is relatively mature, and coordinated control and intelligent measurement technology have made great progress. In addition, energy storage, information security protection, grid connection of new energy power generation and active support and other technological breakthroughs have provided important power and guarantee for the virtual power plant. At the same time, emerging digital technologies such as Internet of things, blockchain, big data, artificial intelligence and digital twins have accelerated the promotion and application in the power system, improving the security and economy of the virtual power plant from the aspects of operation and maintenance, information interaction, market transactions, control strategies, etc. For example, China has built the world’s largest 5g network, and has built the power optical fiber private network and power wireless private network to provide basic support for the realization of monitoring video, rapid data convergence and transmission, massive intelligent terminal interconnection management, interaction level improvement and data exchange in virtual power plants.
Market environment: tight supply and demand, outstanding economic benefits, and a broad market for virtual power plants
On the demand side, the power supply and demand relationship between the East and the west of China is becoming tighter, and the contradiction between peak and valley power is becoming increasingly prominent. The peak load of more than 95% of the annual maximum load in various regions is less than 50 hours, so a reliable solution is urgently needed. On the supply side, the increasingly mature technology has led to the continuous decline in the cost of virtual power plants. According to the calculation of the State Grid, it requires an investment of 400billion yuan to realize the peak load cutting and valley filling of the power system through thermal power plants and meet 5% of the peak load; Through the virtual power plant, the investment in construction, operation, incentive and other links only needs 50-60 billion yuan.
Development status
Industrial chain structure: composed of upstream basic resources, midstream system platform and downstream power demander
(1) Upstream basic resources mainly include adjustable load, distributed power generation and energy storage equipment. The key application fields of adjustable load mainly include industry, construction and residents. The potential for load adjustment varies greatly in different application scenarios. The adjustable loads of commercial and public buildings are mainly air conditioning, lighting and power, accounting for about 25% of the building load. Residents’ adjustable load distribution is scattered, single point capacity is small, and aggregation is difficult. Distributed power generation refers to the configuration of small generator sets at and near the user’s site, including one or several combinations of small gas turbine, small photovoltaic and small wind power, hydropower, biomass, fuel cell, etc. Energy storage equipment can be divided into mechanical energy storage, chemical energy storage, electromagnetic energy storage and phase change energy storage. In practice, all kinds of resources are often mixed. In particular, more and more self-use distributed energy and energy storage are mixed in the adjustable load, or micro network, local energy Internet and other forms are developed through combination as the secondary control unit of the virtual power plant.
The adjustable resources of virtual power plants in China are huge. It is estimated that the adjustable load resource is more than 50million kW, the installed capacity of distributed power is more than 60million kW, the energy storage capacity on the user side is about 1million kW, and the energy storage capacity of electric vehicles is 30million kW. The scale of these resources is still in a period of rapid growth.
(2) Midstream resource aggregators mainly rely on the Internet, big data, etc. to integrate, optimize, dispatch and make decisions from all levels of data information, and enhance the unified coordination and control ability of virtual power plants, which is a key link in the industrial chain of virtual power plants. China’s virtual power plant is still in its infancy, but the market demand is huge. Therefore, China’s resource aggregators carry out research and exploration through a variety of routes. First, obtain the contract to provide auxiliary services and obtain compensation, provide auxiliary services such as peak shaving and valley filling by adjusting user load, and allocate controllable resources to provide power generation capacity; The second is to predict the price fluctuation of the power market, make decisions on the power consumption behavior of adjustable load, act as an agent for power purchase business, and provide users with intelligent power consumption schemes; Third, guide distributed power generation to participate in market transactions in the best way, including signing transaction contracts, determining bidding methods, etc.
(3) The downstream of the industrial chain is the power demander, which is composed of power grid companies, power sales companies and large users. As a power grid operator, power grid companies are important buyers in the power market. Power selling companies include independent power selling companies, power selling companies with distribution network operation rights and power selling companies in the power grid field. Big users mainly refer to the industrial and commercial power big users who can directly participate in the power wholesale market transactions at the B end. Each province designs its own big user standards from the aspects of power consumption, voltage level, industry category, etc.
Practical application: China has transformed from invitation to market, and there are many practices in demand response and peak shaving services
China’s virtual power plants are in the stage of transformation from invitation to market. The virtual power plant projects carried out in various provinces are mainly pilot projects, and a set of mature technical solutions has not yet been formed. In the auxiliary service market, there are many practical projects for peak shaving and valley filling services through demand response. In terms of profit model, China’s virtual power plants, on the one hand, collect service fees from controllable resources to help them participate in market transactions; On the other hand, demand response compensation cost difference can also be obtained. At present, China has not yet established a unified standard in terms of virtual power plant transaction and operation rules, resource aggregation scope, new energy coordination control strategy, scheduling algorithm, etc., and there is a large space for development.
Competition pattern: players in many fields are laying out, and power grid informatization enterprises occupy the mainstream
As a highly capital, resource and technology intensive industry, virtual power plant has certain entry barriers. However, due to the huge development potential of the industry, it has attracted enterprises in many fields. The types of enterprises are diverse, but the market concentration is not high and the competition is fierce. First, the information sector enterprises in the power grid field, relying on the experience and technology in the power and communication fields and the rich information and communication resources of the power grid company, have the inherent advantages of carrying out the virtual power plant business and become the main force of the current demonstration projects, such as State Grid ICT, State Grid Nari, high beam software, etc. Second, it is a solution provider in the field of smart energy and it. It mainly relies on the technical reserves in the field of energy system development, control measurement, digital transformation and other technologies to realize the optimization of virtual power plant system, and realizes resource integration and business expansion through cooperation with enterprises in the field of energy, such as Hengshi technology, Huawei, easytek, Jinzhi technology, Kelu electronics, etc. Third, enterprises in the fields of new energy and new energy storage have also carried out research and development and layout of virtual power plant technology, such as Tianying Co., Ltd., Dianxiang technology, national energy Rixin, etc.
Development prospect
The release of supply and demand potential will promote the substantial growth of the market scale of virtual power plants
Globally, the development of virtual power plants in developed countries in Europe and the United States has formed a certain scale, and the demand for virtual power plants in the Asia Pacific region will further increase. Consulting firm p&s predicts that the global virtual power plant market will grow from USD 192million in 2016 to USD 1188million in 2023, with an average annual compound growth rate of over 30%. China’s virtual power plant is still in the initial stage of development, and the development potential of both supply and demand sides is huge. The clear transformation goal opens new market increments for the development of China’s virtual power plants, while the construction of relevant facilities can well meet the market demand, and the industrial scale is expected to expand rapidly.
Resource aggregators are expected to become the protagonists of virtual power plants and even the power industry
Resource aggregators are expected to become the protagonists of the power industry ecology. On the one hand, resource aggregators are expected to promote power system efficiency through algorithm optimization and business model innovation. At present, China’s resource aggregators are more engaged in supply side and demand side resource optimization in power trading market and auxiliary service market respectively. In the future, the resource aggregator is expected to become a shared service platform, acting as an agent for the resources on both sides of the supply and demand to achieve balance at the distribution network side and then associate with the large power grid, so as to promote the efficiency of supply and demand matching in the entire power market. On the other hand, the scale of resource aggregators will be further expanded. With more and more types and quantities of distributed energy and wider distribution space, some aggregators will eventually become a cross category, wide area source network load storage provider, playing a decisive role in the power industry.
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