Virtual Power Plant Market

Industry Overview

The global Virtual Power Plant Market is anticipated to grow from USD 1.2 billion in 2023 to USD 9.56 billion by 2030, registering a CAGR of 33.45% during the forecast period. A virtual power plant is a cloud-based distributed power plant that is designed to integrate distributed energy resource capacities to trade, generate, and sell power sources in the market and achieve more power generation. Moreover, virtual power plants is a medium-scale power generating unit that combines different energy renewable sources for solar, wind, and other flexible power consumer and storage systems and also provides effective power generation at peak load periods. The mandatory government regulations about greenhouse gas emissions and the rising trend towards green energy along with the cost-efficacy of renewable energy technology have been propelling the adoption of renewable power generation, thereby surging the market growth for the global virtual power plant industry. Virtual power plants are more reliable than traditional power plants, thereby boosting the adoption of virtual power plants. Another reason encouraging demand for this solution is the flexible configuration of the virtual power plant, which can be readily expanded by bringing additional distributed energy resources to the virtual platform. Thus, the industrial sector is increasingly adopting virtual power plants to minimize cost, reduce greenhouse gas emissions, and decrease total energy utilization.

Market Segmentation

Insight by Technology

Based on Technology, the Global Virtual Power Plant Market is segmented into Demand Response, Distributed Generation, and Mixed Asset. Demand response contributes the largest share in the global virtual power plant market owing to grid modernization, developing virtual power plant industry, and the benefits it offers to end users over the long run will drive up the demand. Also, it helps in improving the energy effectiveness of the grid. Additionally, it provides benefits like peak load management and the chance to earn incentives by taking part in demand response programs. The mixed assets technology-based virtual power plants market is anticipated to expand significantly throughout the forecast period as a result of increased consumer and business demand as well as bidirectional electricity flow in the supply chain to meet demand.

Insight by End-User

Based on End-User, the Global Virtual Power Plant market is segregated into Residential, Commercial, and Industrial. The residential segment is anticipated to contribute the largest market share during the forecast period owing to increased acceptance of smart meters, smart home appliances, and interoperability with home energy management systems (HEMS). The global residential housing industry benefits from engaging in demand response programs, energy storage systems, and distributed generation. End users may also store excess energy in energy storage devices like solar panels, batteries, etc., thereby aiding in electricity distribution during peak hours.

Global Virtual Power Plant Market Report Coverage

Industry Dynamics

Growth Drivers

Factors attributing to the market development of the global virtual power plant industry include increased market demand for reliable energy sources i.e. renewable power and renewable energy sources, rapid urbanization and development of smart cities in emerging economies, increased need to reduce electricity bill cost, decreasing solar energy generation cost will propel the market growth of global virtual power plant industry. The surge in initiatives taken by the government to adopt renewable sources for energy generation will accelerate the development of renewable power generation facilities and systems worldwide. Further, with the rising acceptance of IoT, advanced analytics, and cloud-based platforms, the surge in the need to minimize the load on individual power lines and distributed energy flows will foster the product’s demand. Also, the increased need to minimize the dependency on fossil-fuel-based power generation will also bolster the market demand for virtual power plants.

Furthermore, the flexibility to trade in virtual power plants owing to volatility in prices is attracting new entrants. Customers can trade excess energy and purchase energy at less price. These features are fuelling market demand.

Challenges

The high-frequency electromagnetic and radio waves will hurt the health of infants and old-aged people, thereby stymieing market expansion of the global virtual power plant industry. Throughout the forecast period, expansion in the market is anticipated to be constrained by inadequate infrastructure and high costs associated with new technologies.

Opportunities

The strict government regulations about eco-friendly power generation will accelerate the market for renewable energy, thereby creating lucrative market opportunities for the global virtual power plant industry. The rising demand for electric vehicles and the development of smart grids will amplify further prospects of the VPP industry.

Geographic Overview

• North America
• Europe
• Asia Pacific (APAC)
• Rest of the World (RoW)

North America contributes the largest share of the virtual power plant market owing to the rising number of virtual power plant deployment projects.  Industrial expansion in the United States is fueled by the widespread deployment of virtual energy units for optimal energy distribution. In the nation, electricity is produced using a range of energy sources, including nuclear, fossil, and renewable fuels.

Competitive Insight

The impressive distribution network of significant businesses in developed and developing nations has helped to consolidate the global virtual power plant market. The top players in the market, who hold a significant share, are ABB, Autogrid, Next Kraftwerke, and AGL Energy. Small companies like Kiwi Power, Flexitricity, and Limejump have a small share of the global VPP industry. The business is also being driven by numerous public and private partnerships encouraging the use of virtual power plants globally. Thus, government programmes that encourage the development of the renewable energy sector as well as an increase in mergers and acquisitions have sparked fierce market competition.

AutoGrid VPP (Virtual Power Plant) takes into account customer-owned flexible storage, distributed generation, and demand-side resources to commercialize and turn them into cash generators in multiple energy markets. AutoGrid VPP is based on the world's most scalable real-time architecture, with proven deployments assisting energy providers in combining and managing hundreds of assets as single, virtual power plants. AutoGrid VPP, with its best-in-class forecasting and asset-optimization capabilities, enables utilities and aggregators to generate additional flexible capacity and maximize value from flexible resources in promising markets globally. One can forecast, optimize, and control a vast network of distributed energy resources in real-time and at scale with AutoGrid VPP.

Next Kraftwerke is one of the prominent operators of Virtual Power Plant in Europe. They have a network that includes thousands of electricity producers, consumers,  and storage facilities, thereby building a strong team of renewables. Instead of a few large power plants, several small electricity producers will take over their energy supply in the future. To ensure a reliable energy supply, this plethora of decentralized energy resources (DER) must be smartly coordinated. That is exactly what Next Kraftwerke's VPP in Europe is doing, as are other cleantech companies around the world that are implementing their VPPs using Next Kraftwerke technology and know-how. Their product & services include VPP-as-a-Service, Power Trading, Balancing Energy, and Power Scheduling.

Recent Development by Key Players

In October 2022, AutoGrid Systems (AutoGrid), an American virtual power plant (VPP) provider, partnered with Mysa, a Canadian thermostat manufacturing startup, to scale and launch VPP projects.

In January 2022, Southern California Edison (SCE) chose Generac Grid Services as one of the Virtual Power Plant (VPP) providers for the company's Power Flex program. By enrolling in a VPP designed to relieve pressure on the power grid during peak demand, SCE residential customers can extend the value and return on investment of their residential solar PV and battery storage systems.

In August 2022, Tesla, an electric car maker is developing a virtual power plant in Japan. This project is based on the solar panel and storage battery installation service that allows users to install a solar power generation system and a storage battery with zero installation cost.

Key Players Covered in the Report

Some of the major players operating in the global virtual power plant market include ABB, AutoGrid, Next Kraftwerke, AGL Energy, Cisco Systems Inc., Generac Grid Services, Enel X North America, Inc., General Electric, Tesla, and Siemens.

The Virtual Power Plant Market report offers a comprehensive market segmentation analysis along with an estimation for the forecast period 2023–2030.

Segments Covered in the Report

• By Technology 
  • Demand Response
  • Distributed Generation
  • Mixed Asset
• By End-User 
  • Residential
  • Industrial
  • Commercial

Region Covered in the Report

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • Germany
  • U.K.
  • France
  • Italy
  • Spain
  • Russia
  • Rest of Europe
• Asia-Pacific (APAC)
  • China
  • Japan
  • India
  • South Korea
  • Rest of Asia-Pacific
• Rest of the World (RoW)
  • Brazil
  • Saudi Arabia
  • South Africa
  • U.A.E.
  • Other Countries

Source: VynZ Research

Source: VynZ Research

1.    Research Overview

        1.1.    The Report Offers
        1.2.    Market Coverage
                1.2.1.    By Technology
                1.2.2.    By End-User
                1.2.3.    By Region
        1.3.    Research Phases
        1.4.    Limitations
        1.5.    Market Methodology
                1.5.1.    Data Sources
                        1.5.1.1. Primary Research
                        1.5.1.2. Secondary Research
                1.5.2.    Methodology
                        1.5.2.1. Data Exploration
                        1.5.2.2. Forecast Parameters
                        1.5.2.3. Data Validation
                        1.5.2.4. Assumptions
                1.5.3.    Study Period & Data Reporting Unit

2.    Executive Summary

3.    Industry Overview

        3.1.    Industry Dynamics
                3.1.1.    Market Growth Drivers
                3.1.2.    Market Restraints
                3.1.3.    Key Market Trends
                3.1.4.    Major Opportunities
        3.2.    Industry Ecosystem
                3.2.1.    Porter’s Five Forces Analysis
                3.2.2.    Recent Development Analysis
                3.2.3.    Value Chain Analysis
        3.3.    Competitive Insight
                3.3.1.    Competitive Position of Industry Players
                3.3.2.    Market Attractive Analysis
                3.3.3.    Market Share Analysis

4.    Global Market Estimate and Forecast

        4.1.    Global Market Overview
        4.2.    Global Market Estimate and Forecast to 2030

5.    Market Segmentation Estimate and Forecast

        5.1.    By Technology
                5.1.1.    Demand Response
                        5.1.1.1. Market Definition
                        5.1.1.2. Market Estimation and Forecast to 2030 
                5.1.2.    Distributed Generation
                        5.1.2.1. Market Definition
                        5.1.2.2. Market Estimation and Forecast to 2030
                5.1.3.    Mixed Asset
                        5.1.3.1. Market Definition
                        5.1.3.2. Market Estimation and Forecast to 2030
        5.2.    By End-User
                5.2.1.    Residential
                        5.2.1.1. Market Definition
                        5.2.1.2. Market Estimation and Forecast to 2030
                5.2.2.    Industrial
                        5.2.2.1. Market Definition
                        5.2.2.2. Market Estimation and Forecast to 2030
                5.2.3.    Commercial
                        5.2.3.1. Market Definition
                        5.2.3.2. Market Estimation and Forecast to 2030
                                                
6.    North America Market Estimate and Forecast

        6.1.    By Technology
        6.2.    By End-User
        6.3.    By Country
                6.3.1.    U.S. Market Estimate and Forecast
                6.3.2.    Canada Market Estimate and Forecast
                6.3.3.    Mexico Market Estimate and Forecast

7.    Europe Market Estimate and Forecast

        7.1.    By Technology
        7.2.    By End-User
        7.3.    By Country
                7.3.1.    Germany Market Estimate and Forecast
                7.3.2.    France Market Estimate and Forecast
                7.3.3.    U.K. Market Estimate and Forecast
                7.3.4.    Italy Market Estimate and Forecast
                7.3.5.    Spain Market Estimate and Forecast
                7.3.6.    Rest of Europe Market Estimate and Forecast

8.    Asia-Pacific Market Estimate and Forecast

        8.1.    By Technology
        8.2.    By End-User 
        8.3.    By Country
                8.3.1.    China Market Estimate and Forecast
                8.3.2.    Japan Market Estimate and Forecast
                8.3.3.    India Market Estimate and Forecast
                8.3.4.    South Korea Market Estimate and Forecast
                8.3.5.    Singapore Market Estimate and Forecast
                8.3.6.    Rest of Asia-Pacific Market Estimate and Forecast

9.    Rest of the World (RoW) Market Estimate and Forecast

        9.1.    By Technology
        9.2.    By End-User
        9.3.    By Country
                9.3.1.    Brazil Market Estimate and Forecast
                9.3.2.    Saudi Arabia Market Estimate and Forecast
                9.3.3.    South Africa Market Estimate and Forecast
                9.3.4.    Other Countries Market Estimate and Forecast

10.    Company Profiles

        10.1. ABB
                10.1.1.    Snapshot
                10.1.2.    Overview
                10.1.3.    Offerings
                10.1.4.    Financial Insight
                10.1.5.    Recent Developments
        10.2.    AutoGrid
                10.2.1.    Snapshot
                10.2.2.    Overview
                10.2.3.    Offerings
                10.2.4.    Financial Insight
                10.2.5.    Recent Developments
        10.3.    Next Kraftwerke
                10.3.1.    Snapshot
                10.3.2.    Overview
                10.3.3.    Offerings
                10.3.4.    Financial Insight
                10.3.5.    Recent Developments
        10.4.    AGL Energy
                10.4.1.    Snapshot
                10.4.2.    Overview
                10.4.3.    Offerings
                10.4.4.    Financial Insight
                10.4.5.    Recent Developments
        10.5.Cisco Systems Inc.
                10.5.1.    Snapshot
                10.5.2.    Overview
                10.5.3.    Offerings
                10.5.4.    Financial Insight
                10.5.5.    Recent Developments
        10.6. Generac Grid Services
                10.6.1.    Snapshot
                10.6.2.    Overview
                10.6.3.    Offerings
                10.6.4.    Financial Insight
                10.6.5.    Recent Developments
        10.7.    Enel X North America, Inc.
                10.7.1.    Snapshot
                10.7.2.    Overview
                10.7.3.    Offerings
                10.7.4.    Financial Insight
                10.7.5.    Recent Developments
        10.8.    General Electric
                10.8.1.    Snapshot
                10.8.2.    Overview
                10.8.3.    Offerings
                10.8.4.    Financial Insight
                10.8.5.    Recent Developments
        10.9.    Tesla
                10.9.1.    Snapshot
                10.9.2.    Overview
                10.9.3.    Offerings
                10.9.4.    Financial Insight
                10.9.5.    Recent Developments
        10.10. Siemens
                10.10.1. Snapshot
                10.10.2. Overview
                10.10.3. Offerings
                10.10.4. Financial Insight
                10.10.5. Recent Developments

11.    Appendix

        11.1.    Exchange Rates
        11.2.    Abbreviations

Note: Financial insight and recent developments of different companies are subject to availability of information in secondary domain.

List of Tables

Table 1 Sources
Table 2 Study Periods
Table 3 Data Reporting Unit
Table 4 Global Virtual Power Plant Market Size, By Technology, 2018 - 2023 (USD Billion)
Table 5 Global Virtual Power Plant Market Size, By Technology, 2025 - 2030  (USD Billion)
Table 6 Global Virtual Power Plant Market Size, By End-User, 2018 - 2023 (USD Billion)
Table 7 Global Virtual Power Plant Market Size, By End-User, 2025 - 2030  (USD Billion)
Table 8 Global Virtual Power Plant Market Size, by Region, 2018 - 2023 (USD Billion)
Table 9 Global Virtual Power Plant Market Size, by Region, 2025 - 2030  (USD Billion)
Table 10 North America Virtual Power Plant Market Size, By Technology, 2018 - 2023 (USD Billion)
Table 11 North America Virtual Power Plant Market Size, By Technology, 2025 - 2030  (USD Billion)
Table 12 North America Virtual Power Plant Market Size, By End-User, 2018 - 2023 (USD Billion)
Table 13 North America Virtual Power Plant Market Size, By End-User, 2025 - 2030  (USD Billion)
Table 14 North America Virtual Power Plant Market Size, by Region, 2018 - 2023 (USD Billion)
Table 15 North America Virtual Power Plant Market Size, by Region, 2025 - 2030  (USD Billion)
Table 16 Europe Virtual Power Plant Market Size, By Technology, 2018 - 2023 (USD Billion)
Table 17 Europe Virtual Power Plant Market Size, By Technology, 2025 - 2030  (USD Billion)
Table 18 Europe Virtual Power Plant Market Size, By End-User, 2018 - 2023 (USD Billion)
Table 19 Europe Virtual Power Plant Market Size, By End-User, 2025 - 2030  (USD Billion)
Table 20 Europe Virtual Power Plant Market Size, by Region, 2018 - 2023 (USD Billion)
Table 21 Europe Virtual Power Plant Market Size, by Region, 2025 - 2030  (USD Billion)
Table 22 Asia-Pacific Virtual Power Plant Market Size, By Technology, 2018 - 2023 (USD Billion)
Table 23 Asia-Pacific Virtual Power Plant Market Size, By Technology, 2025 - 2030  (USD Billion)
Table 24 Asia-Pacific Virtual Power Plant Market Size, By End-User, 2018 - 2023 (USD Billion)
Table 25 Asia-Pacific Virtual Power Plant Market Size, By End-User, 2025 - 2030  (USD Billion)
Table 26 Asia-Pacific Virtual Power Plant Market Size, by Region, 2018 - 2023 (USD Billion)
Table 27 Asia-Pacific Virtual Power Plant Market Size, by Region, 2025 - 2030  (USD Billion)
Table 28 RoW Virtual Power Plant Market Size, By Technology, 2018 - 2023 (USD Billion)
Table 29 RoW Virtual Power Plant Market Size, By Technology, 2025 - 2030  (USD Billion)
Table 30 RoW Virtual Power Plant Market Size, By End-User, 2018 - 2023 (USD Billion)
Table 31 RoW Virtual Power Plant Market Size, By End-User, 2025 - 2030  (USD Billion)
Table 32 RoW Virtual Power Plant Market Size, by Region, 2018 - 2023 (USD Billion)
Table 33 RoW Virtual Power Plant Market Size, by Region, 2025 - 2030  (USD Billion)
Table 34 Snapshot – ABB
Table 35 Snapshot – AutoGrid
Table 36 Snapshot – Next Kraftwerke
Table 37 Snapshot – AGL Energy
Table 38 Snapshot – Cisco Systems Inc.
Table 39 Snapshot – Generac Grid Services
Table 40 Snapshot – Enel X North America, Inc.
Table 41 Snapshot – General Electric
Table 42 Snapshot – Tesla
Table 43 Snapshot – Siemens

List of Figures

Figure 1 Market Coverage
Figure 2 Research Phases
Figure 3 Secondary Sources for Different Parameters
Figure 4 Methodology
Figure 5 Data Mining & Exploration
Figure 6 Data Triangulation
Figure 7 Assumptions for Market Estimation and Forecast
Figure 8 Market Synopsis
Figure 9 Global Virtual Power Plant Market - Growth Drivers and Restraints
Figure 10 Competitive Benchmark
Figure 11 Global Virtual Power Plant Market Highlight
Figure 12 Global Virtual Power Plant Market Size, By Technology, 2018 - 2030 (USD Billion)
Figure 13 Global Virtual Power Plant Market Size, By End-User, 2018 - 2030 (USD Billion)
Figure 14 Global Virtual Power Plant Market Size, by Region, 2018 - 2030 (USD Billion)
Figure 15 North America Virtual Power Plant Market Highlight
Figure 16 North America Virtual Power Plant Market Size, By Technology, 2018 - 2030 (USD Billion)
Figure 17 North America Virtual Power Plant Market Size, By End-User, 2018 - 2030 (USD Billion)
Figure 18 North America Virtual Power Plant Market Size, by Region, 2018 - 2030 (USD Billion)
Figure 19 Europe Virtual Power Plant Market Highlight
Figure 20 Europe Virtual Power Plant Market Size, By Technology, 2018 - 2030 (USD Billion)
Figure 21 Europe Virtual Power Plant Market Size, By End-User, 2018 - 2030 (USD Billion)
Figure 22 Europe Virtual Power Plant Market Size, by Region, 2018 - 2030 (USD Billion)
Figure 23 Asia-Pacific Virtual Power Plant Market Highlight
Figure 24 Asia-Pacific Virtual Power Plant Market Size, By Technology, 2018 - 2030 (USD Billion)
Figure 25 Asia-Pacific Virtual Power Plant Market Size, By End-User, 2018 - 2030 (USD Billion)
Figure 26 Asia-Pacific Virtual Power Plant Market Size, by Region, 2018 - 2030 (USD Billion)
Figure 27 RoW Virtual Power Plant Market Highlight
Figure 18 RoW Virtual Power Plant Market Size, By Technology, 2018 - 2030 (USD Billion)
Figure 29 RoW Virtual Power Plant Market Size, By End-User, 2018 - 2030 (USD Billion)
Figure 30 RoW Virtual Power Plant Market Size, by Region, 2018 - 2030 (USD Billion)