PUBLISHER: Guidehouse Insights | PRODUCT CODE: 1063464
PUBLISHER: Guidehouse Insights | PRODUCT CODE: 1063464
Virtual power plants (VPPs) have gained significant traction across all customer segments in recent years as distributed energy resources (DER) deployment continues to increase. The variable and non-dispatchable nature of renewable energy sources such as wind and solar has highlighted the issue of supply and demand mismatch in the transition away from fossil fuels. VPPs can aggregate and dispatch hundreds or thousands of DER assets to balance the grid when renewable output is not sufficient, effectively acting like a traditional 24/7 power plant.
The VPP market is segmented into three types: demand response (DR) VPPs, supply-side VPPs, and mixed-asset VPPs. The VPP market is trending toward the mixed-asset model because of its ability to use supply, demand, and energy storage resources to serve the grid. The continued growth of DER deployments, electrified end uses, and digitalization along with increasingly aggressive climate goals in response to the climate emergency have driven the VPP market. At the same time, high system and DER costs along with concerns over privacy and cybersecurity remain barriers to growth.
This Guidehouse Insights report examines the VPP market in five select countries across North America, Europe, and the Asia Pacific region. Regional-level forecasts for Latin America and the Middle East & Africa are also presented. Individual forecasts segment capacity by VPP type and show total VPP spending and revenue in each market from 2022-2031.