The Australian Energy Market Operator (AEMO) today opened registrations for participation in its virtual power plant (VPP) demonstration program.

The program will test the potential for consumers’ distributed energy resources (DERs) – such as rooftop solar systems, battery storage and controllable load devices – operating in a VPP, to provide scalable energy and network services traditionally performed by large-scale, conventional electricity generators.

This initiative contributes to unlocking new value for Australian consumers with DERs, including an estimated two million rooftop solar systems, benefiting all energy users through a more efficient and affordable power system.

AEMO’s Emerging Markets and Services EGM, Violette Mouchaileh, said that the demonstrations come at a time when the energy sector is experiencing unprecedented change, moving towards a decentralised generation model.

“Australia’s energy landscape is rapidly transforming, faster than most developed economies, creating power-system operation and design challenges, as well as presenting opportunities to create a future world-class power system,” Ms Mouchaileh said.

“As the independent energy system and market operator, we believe DER growth can empower consumers to contribute scalable value to our future energy system by joining virtual power plants that actively participate in Australia’s electricity markets.

“Registrations are open, and we encourage VPPs to register to accelerate the shared learning on how to safely and efficiently integrate, operate and regulate these emerging technologies into the NEM,” she said.

ARENA CEO Darren Miller said: “VPPs will play an important role in maintaining grid stability and managing peaks in demand by harnessing consumer-owned energy assets like rooftop solar and batteries.

“More than two million Australian households have already taken up rooftop solar, and tens of thousands are adding home batteries, so it is going to be increasingly important to have the ability to coordinate and control these distributed assets - as well as other distributed assets such as smart appliances, solar hot water systems, pool pumps and electric vehicles. This trial is a crucial first step towards that. 

“ARENA has played a role in funding some of South Australia’s largest VPP trials with AGL and Simply Energy, and has supported Greensync's deX platform. We look forward to seeing the end results of the applicants in the AEMO VPP integration trial," he said.

Australia hosts some of the most advanced VPP projects in the world, particularly involving rooftop photovoltaic (PV) systems and battery storage, in both grid-connected and off-grid applications. 

Prominent grid-connected examples include the 36 megawatt Next Generation Energy Storage Program with more than 5,000 batteries in Canberra homes and the South Australian public housing tenants’ VPP that, if commercialised, could reach up to 50,000 public and private property installations, making it one of the biggest VPPs in the world. 

These demonstrations are the first step in a broad program of work designed to inform changes to regulatory frameworks and operational processes so DER can be effectively integrated into Australia’s energy system and market. This will maximise value to consumers while also supporting power system security.

Today’s announcement builds on collaboration between AEMO, the Australian Energy Market Commission (AEMC), the Australian Energy Regulator (AER) and industry members to establish the framework to support these VPP demonstrations.

For more information on the VPP demonstrations program and to register, visit AEMO’s website.