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One of the lesser known Laws of Physics is the rule that when something new is created or discovered, labellers rush in to fill the hitherto unquantifiable vacuum with descriptors, catch phrases, hooks, embellishments. Take rock n roll for example. Used to be just rock n roll, right? The sixties dealt with straight up and down Stones vs Beatles, then something happened and psychedelic rock appeared which quickly spawned prog then glam, punk, garage, new wave, no wave, metal, grunge, shoe gaze, on and on and on…everything needs a label.

The IT industry is another. In fact, the term “IT” is itself only a couple of decades old. ‘Desktop’ – once had paper on it; ‘mouse’ – animal a cat catches; ‘cursor’ – someone who swears. Either traditional English words and phrases become appropriated or mashed up to describe something altogether different or new words are born to easily surmise the amazing new thing – ‘email’, ‘blog’, ‘screenshot’.

The renewable energy industry is pretty young and fresh, too. A game changer, a new thing. Better give it some clever new labels. Solar farms. Wind farms. Solar thermal. Demand management. Micro grids. Feed in Tariffs. Carbon footprint. Green credentials.

I understand and appreciate the work of the people who come up with these labels, I really do. A neat summation of what the thing is and what the thing does. Solar farm grows and harvests solar power, just like potatoes, got it.

Which brings me to Virtual Power Plants. Now the word ‘virtual’ means “something that exists in the mind or in essence, but not in fact”. So, what is this thing that is not-in-fact a power plant but is getting an awful lot of press lately?  How is the general public and, just right now, the South Australian voting public having to embrace no wait…believe in… power plants that are not in fact power plants? Excellent questions and thank you for asking…

What I’ll try to do with this column is dumb down the Virtual Power Plant (VPP) model so all of us may be given an idea of just what it is the renewable nerds (and State premiers) are talking about. And perhaps present a couple of Devils Advocate style thoughts into the mix to thicken the brew…

Power Plant: Spend a few billions, build a power plant – coal, gas, nuclear, solar, wind, wave, solar thermal, bio mass, we all get that. There it is, honey, on the horizon, belching smoke….Power Plant.

Virtual Power Plant: Gather up a whole bunch of rooftop solar buyers/users/investors, add up how much electricity all of these rooftops can generate and/or store in batteries each day, offer them all decent money to sell that power back to the grid when it’s needed and hey presto! a cumulative source of power for the grid when needed – it’s a power plant, Jim, but not as we know it.

To explain, let’s look at the big musk flavoured lolly Jay Weatherill is dangling in front of his swinging constituents: 50,000 houses, 5kW solar systems on each with software enmeshing the entire network together. If needed the SA power network can draw upon this reserve to help the grid when in crisis. That is, cumulatively, this VPP is a 250megaWatt power plant. In the words of Benny Hill, that’s big.

Ok, cool. So far so good. A great idea in the mind or in essence…

So just say, you’re one of those 50,000 customers. Just say you want to keep all your power for yourself BUT it gets taken from you anyway. Your own personal needs (and don’t forget, you bought this solar system with your own money) are superseded by the needs of The State. Are you happy to contribute to the Greater Good? For how long is this arrangement in place? What are you paid for your power? Is there competition amongst retailers for your exported business? Can you get out of this arrangement?

There are waaaaay too many unanswered questions for this (or any) VPP to get off the ground. The truth is, when Weatherill announced this “I love Elon” deal, there isn’t a single electricity retailer who has put up its hand to facilitate this new model. The 50,000 are still going to need to receive bills, but who is going to provide them?

Truth is, there have been a number of trials conducted across the country with several retailers bankrolling these experiments with, to date, no concrete data or evidence supporting the VPP model. I’m not saying it’s bollocks, I just need to see a small one work, with a retail billing model included, to give me a little confidence that the energy nerds are on to something viable, that can be rolled out, large, small, across the grid for the benefit of locals and the grid generally.

Getting back to IT, Silicon Valley has produced the most exciting and innovative breakthroughs in communication and quality of life services by far in the last 3 decades. Unquestioned. There have been a helluva lot of successes-but more failures. As the renewable energy industry continues to grow and evolve, the comparisons to IT make sense. We will see tremendous advances in how we can generate, use and manage our electricity both domestically and across the greater parameters of the national grid. Common sense and the weight of history suggests we should expect many more noble experiments that try…and die.

Virtual Power Plants are way cool but are they for real?  Watch this space…


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