Dive Summary:

• The market for Virtual power plants (VPPs) –software systems coordinating a diverse network of distributed generation (DG) assets – is small now, but this won’t be the case for long. A recent report by Navigant research predicts the market will boom from $1 billion globally in 2013 to $3.6 billion in annual revenue by 2020.
• Prompted by the need to integrate solar and wind into the grid, VPPs optimize grid flow via sophisticated planning, scheduling, and bidding of distributed generation, buoyed also by the growing microgrid market.
• Ultimately utilities will decide how to take advantage of this emerging market. When compared with conventional coal and natural gas-fired plants, VPPs offer a lower-cost platform to derive value from existing infrastructure assets and reduce greenhouse gas emissions associated with peaking power plants.

From the press release:
“Although recent regulatory reforms are moving in the direction of a greater reliance on distributed energy resources, centralized fossil fuel power plants will still dominate electricity markets for quite some time.”