Virtual power plants: Definition, applications and barriers to the implementation in the distribution system

A virtual power plant assists in the integration of distributed energy resources in the power system. With a rising share of distributed generation, an active management of distributed energy resources is indispensable in order to ensure operation of the electricity network towards the future. In this paper, the virtual power plant concept is analyzed. Three essential components that characterize a virtual power plant are distinguished, followed by a comprehensive overview of the services they can deliver in today´s liberalized markets in Europe. It is found that a combination of technical, economic and regulatory barriers still hamper a widespread implementation of the concept. In addition, specific regulatory barriers are identified that hinder a virtual power plant in providing certain services. Hence, it is advised that primarily product and service definitions, as well as market mechanisms, are reviewed.