Solar industry should focus on virtual power plants, says US official


From pv magazine USA

The days of the solar industry operating as a “net metering type of industry” are “starting to be numbered,” said Jigar Shah, the director of the US Department of Energy’s Loan Programs Office, at the recent RE+ 2023 conference in Las Vegas.

“Most solar systems come with batteries, and most are integrating smart panels,” he said. “They’re integrating demand response and load control capabilities into the inverter controls.”

Because a solar-plus-storage system with those features can earn its owner compensation through participation in a virtual power plant (VPP) – an aggregation of similar systems often managed by a third-party aggregator – Shah encouraged the solar industry to see its future in VPPs. The deployment of VPPs to date is shown in the featured image above.

Besides distributed storage, other distributed energy resources that can be aggregated into a VPP include electric vehicle chargers, smart thermostats, and smart electric water heaters.

Shah said that electric utilities are “looking to bury the hatchet and really deploy a lot of these technologies at scale” through VPPs. “Frankly, it is the only way for them to integrate all of the huge load that is coming their way.”

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Shah said utilities Duke Energy, serving the Carolinas, and Luma Energy in Puerto Rico have announced large VPP projects, the latter with the residential solar firm Sunnova.

Addressing the solar industry professionals in his audience at RE+, Shah said “you’re the ones who should be integrating all of the technologies that are shown on the floor out there, into a coherent package.”

For its part, the DoE anticipates lending support on the order of $100 million to advance VPPs, Shah said. Sunnova’s inclusion of low- and moderate-income Puerto Ricans in its VPP project is being supported by $3 million in loan support, while other applicants are already preparing $30 million in loan requests.

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