Microgrid & Virtual Power Plant

Population growth, urbanisation and the demands of the digital age have impacted the reliability and flexibility of the traditional electricity grid.

Microgrids can operate autonomously from the grid, meaning that your business keeps running even when the traditional grid is out of action.

Our Virtual Power Plant proposition maximises the value of your business’ flexible, distributed energy resources through aggregation with other assets from our client base.

The Benefits

Microgrids & Virtual Power Plants can help cut costs by allowing you to be more energy-independent and a providing access to cheaper, more sustainable energy sources.

They can also provide a source of revenue through energy on-sell or arbitrage opportunities. Where consistent supply is paramount, they increase energy reliability and can positively impact your carbon footprint by increasing your usage of electricity from renewables like Solar.

One of the main benefits of Microgrids is that they can operate autonomously from the grid, meaning that your business keeps running even when the traditional grid is out of action.

A Virtual Power Plant (VPP) aggregates individual, dispatchable, distributed energy resources, such as Solar or Energy Storage. On their own, these assets have limited value to the electricity system, but through aggregation and remote operation, they become highly valuable from an electricity system’s perspective.

Delivers Energy Savings

Your microgrid will generate electricity for you to use independently from the grid, which means you’ll save on your grid energy costs. By generating your own power, you can also create a source of revenue through services provided to the National Electricity Market (NEM).

Increases Operations Resilience

During power outages, storms and other hazards which interfere with the traditional grid, your microgrid will help increase operations resilience by keeping your business powered up.

Helping You Reach Net-Zero

Microgrids help increase your usage of renewable energy onsite which means lower carbon emissions for your business.

What is a Microgrid?

A microgrid is a  small local energy grid  that is designed to  operate autonomously from the traditional grid as required. 

This means they can separate from the grid and operate independently using local and distributed energy generation, such as Solar, Energy Storage and back-up generation.

In times of crisis like power outages or natural disasters,  microgrid can keep you powered up and operating independently for up to several days.

What is a Virtual Power Plant?

While a microgrid is often considered a single site, a Virtual Power Plant (VPP) is the combination of multiple sites, technologies and assets. These sites are integrated together using specialised software and hardware to form a virtual energy network that can be centrally controlled while maintaining independence.

VPPs allow grouping of small to medium generation, storage and control assets to work together and gain the benefits of shared resources such as the ability to maximise value by effectively operating as a larger asset.

The value of a VPP is mostly driven by the number, size, diversity and flexibility of its individual assets. While the value of each individual asset may be small due to high costs or restricted options to monetise its flexibility, the value of an aggregated asset portfolio can be substantial.

Frequently Asked Questions

What are the components of a Microgrid/Virtual Power Plant (VPP)?

No two microgrids are the same as they are custom designed to meet the end user’s needs. However, all microgrids/VPPs will include on-site energy generation (be it solar, diesel or other fuel generators) and some form of monitoring/control/optimisation hardware and software along with standard energy connection infrastructure such as meters and grid connection. In addition to these elements it is common for Microgrids and VPPs to include storage, load management and other systems to maximise the effectiveness and benefits of the Microgrid/VPP.

What role do solar and batteries play in a Microgrid or Virtual Power Plant (VPP)?

Microgrids and VPPs typically require some form of on-site generation, with solar able to fill this role. This is due to it often being the most affordable, cleanest and easiest on-site generation technology available (compared to diesel, gas or wind). As solar is an intermittent source of energy it may be coupled with other generating technologies where viable or more commonly coupled to some form of energy storge (typically a battery) to optimise the use of on-site energy and maximise benefits. Together, a well-designed solar and storage solution can provide a high degree of flexibility to maximise savings, revenue generation and emissions reduction.

I already have solar and/or batteries, can I still have a microgrid?

Yes! – Microgrids and VPPs are custom designed to meet an end user’s needs and this includes integration with existing assets and systems. Depending on what has been installed along with your system, some upgrades may be required to inverters, switchboards and control systems but the extent of these upgrades can be determined during a feasibility assessment, with additional benefits potentially outweighing the cost.

Will a microgrid allow me to disconnect from the existing grid completely?

While it is possible to design a Microgrid or VPP to enable complete disconnection from the existing grid, it is rarely done outside of remote communities or locations where there is no existing grid infrastructure. There are a number of reasons for this, but it primarily comes down to cost. In order to achieve complete separation from the grid, generation and storage assets will likely need to be significantly oversized to guarantee reliable 24/7 supply. This often comes at the expense of project viability with significantly larger upfront investment and a system rarely operating at optimal capacity. Typically, a Microgrid or VPP will be designed to allow grid disconnection for shorter durations (such as during power outages).

Will I save on energy costs with a Microgrid or Virtual Power Plant (VPP)?

Yes! – A well designed Microgrid or VPP solution will not only reduce your energy cost but may open up additional revenue streams as well. They do this by using intelligent controls to optimise energy use from cheaper sources (such as on-site solar generation and battery storage) during peak times and sourcing grid electricity when it is at its cheapest. On-site generation and storage also enable the end user to generate revenue through on-sell and energy arbitrage opportunities.

Do I need to invest in a Microgrid myself?

No – While some energy users may choose to provide the capital and assume full ownership for a microgrid system, there are other commercial models available that require no upfront investment. Microgrids can be designed, built, owned, operated and maintained under an Energy as a Service (EaaS) model where an energy service provider (such as Verdia) provides the capital to build the microgrid and assumes responsibility of its ownership, operation and maintenance for an agreed term (typically 10-20 years). Under this model the end user enters an EaaS Agreement with the energy service provider at a pre-agreed rate for the energy and services delivered by the microgrid system. Within this model there is significant flexibility to meet the end user requirements, including variables such as EaaS price/term, revenue/benefits sharing, roof/land rental, buy-out optionality, asset transfer etc. An EaaS structured Microgrid delivers the same benefits of an energy user funded microgrid without the capital cost.

Start a Conversation with us

Verdia can help you determine the feasibility of Microgrid and/or Virtual Power Plant for your organisation and develop the business case for investment. Once approved, we can design and deliver your project to ensure you achieve your energy savings goals.

Contact Us