According to the estimations put forth by Inkwood Research, the Global Virtual Power Plant Market is predicted to register a CAGR of 24.35% in terms of revenue during the forecasting years, 2024-2032.
A virtual power plant is a cloud-based control that is capable of functioning in a centralized or distributed manner, which assists in aggregating the capacity of distributed energy resources. It integrates the distributed power sources in a single system, regulating power efficiently.
Rising Adoption of Decentralized Power Generation Drives Market Growth
Distributed generation is a rising trend in the electricity sector. This technology involves installing electricity-generating systems independently connected at the distribution system electric grid level. Operational benefits of distributed generation include ancillary services, peak power requirements, grid security, and system reliability. These advantages are not achievable with centralized generation in the current energy sector.
Enhanced system reliability is a result of having a single point for power conversion. This eliminates the need for high voltage DC wiring, reduces the impact of fires, and minimizes the risk of electrocution. The increasing adoption of virtual power plants is driven by the discontinuity in power supply and declining power quality. The current trend in distributed energy is expected to influence market growth positively.
Energy Storage System is Evaluated to be the Prominent Source
Energy storage systems play a significant role in regulating the variability of renewable energy generation sources. They maintain the continuity of power flow in the grid network and power quality, ensuring they meet electricity demands and act as secondary power suppliers. The batteries can be charged during peak-off hours when there is reduced load on the grid, providing flexibility to charge them according to the convenience of end-users.
In response to the increasing demand for energy generation from renewable sources and the negative environmental implications of conventional sources, a virtual power plant integrates energy storage systems and distributed energy sources in a centralized platform. This approach aims to meet electricity demands while mitigating the impact of greenhouse gas emissions associated with conventional energy generation. By integrating these technologies, virtual power plants contribute to a more sustainable and environmentally friendly energy landscape.
North America is the Dominating Region in the Global Market
Favorable government initiatives, technological advancements, and increased adoption of virtual power plants (VPPs) in grid-balancing technologies characterize the region, catering to residential, industrial, and commercial customers. There is also an increasing inclination toward clean energy generation through the use of renewable energy, which is estimated to boost the deployment of VPPs.
In the US, one of the crucial factors driving growth is the ability to meet electricity demand during peak hours. The market experiences high competitive rivalry, with companies conducting extensive research to enhance the quality of virtual power plant solutions.
Some prominent companies in the market include Robert Bosch, Tesla, Next Kraftwerke, Schneider Electric, ABB, Siemens, etc.
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