Interested in supporting Australia’s transition to renewables while opening a new revenue stream? You’ve come to the right place.
A Virtual Power Plant, or VPP for short, is a group of energy assets that work together to pool their power capability. Joining a VPP means you can put your energy assets to good use supporting the Australian grid – and get paid for it.
These assets include things that can export energy into the grid when it’s needed, like solar panels, batteries or backup generators. It also includes energy-consuming assets, like HVAC systems, data centres or cold stores that can be controlled – turned up or down – adapting to what’s happening on the grid.
Using advanced algorithms, automation, and artificial intelligence, the VPP gets individual assets to work together like a traditional power plant – able to respond to the demands of the market.
VPPs are going to play a vital role in Australia’s transition to renewables – and they’re brilliant in virtually every way.
Unless you’ve been hiding under a particularly large rock, you’ll have heard global temperatures are rising. To help combat this, Australia is making moves to reduce emissions and our dependency on fossil fuels.
To do this we need to change how we generate electricity, moving to renewable generation. Renewables are great, however the most popular ones like wind and solar depend on weather for their output, which makes them a bit unpredictable.
VPPs will play a very important role in those moments when the sun doesn’t shine, the wind doesn’t blow or there’s an oversupply of power on the grid.
By 2050, we’re going to need an additional 57GW of dispatchable power to maintain grid stability. You don’t have to be a physics professor to know that’s a mega-load of extra power. But by being part of a VPP you could help supply the energy we need or modulate your load to relieve some of that pressure – and make real money in the process.
If your large business is based in VIC, QLD, SA, NSW or ACT and has controllable large energy-using or energy generating assets, then Hydro Tasmania’s VPP could be right for you.
It can work with energy assets that export, store or consume energy including:
The fastest way to find out if you’re eligible is to speak with our team.
Hydro Tasmania is Australia’s largest generator of renewable energy and their VPP supports Australia’s transition to renewables.
A VPP powered by Hydro Tasmania means your assets are in expert hands with one of the largest participants in Australia’s FCAS (Frequency Control Ancillary Services) market.
The revenue sharing model means you retain your share of the profits.
Our VPP trading application was built by Hydro Tasmania and is supported by an on-site trading team 24/7.
Hydro Tasmania’s VPP is one of the few which can aggregate smaller assets to bid as a single larger block into the FCAS market, so you can leverage smaller assets too.
As your experienced market partner, Hydro Tasmania will manage bidding and market compliance, so you don’t have to.
A VPP is a network of distributed energy assets that are connected and managed remotely via smart technology. Each time your assets help to support the grid – you can make money. Sounds like a fair deal, right?
When you sign up, you give Hydro Tasmania permission to access your energy assets when the grid needs either additional supply (energy generation and storage) or lower load (energy consumption). They’ll convert your assets to ‘smart assets’ capable of participating in energy markets.
You set the operating parameters so core operations always come first. The trading team will leverage your assets in a way that minimises impact on your organisation.
The VPP uses artificial intelligence and machine learning to forecast prices and aims to optimise your assets into the best available market – it’s clever stuff.
The trading team will always aim to optimise your sites energy capacity with the highest value market opportunity available. Hydro Tasmania retains a small percentage of the revenue generated (ensuring our interests are aligned). The better the price they find for you, the better everyone does – but you’ll always get the lion’s share. You’ll also pay an annual fee to access the VPP platform.
Curious to know how much you may have been able to earn in the last 12 months? Register your details with us for a free backcast (you guessed it, it’s the opposite of a forecast, only we use real numbers to estimate what you might have earned over the last year or two).
Register now
There’s a good chance you’ll find the answer here in our Virtual Power Plant FAQs.
One of the challenges facing Australia in the transition to renewables is grid stability. Burning fossil fuels offers a steady and reliable supply of power, while popular renewables like wind and solar depend on unpredictable weather conditions for their output.
VPPs will play a very important role in those moments when the sun doesn’t shine, the wind doesn’t blow or there’s an oversupply of power in the grid.
During periods of peak demand, virtual power plants can step up, drawing on distributed energy assets to top up any shortfall. Reducing risk of blackouts and brownouts. They also offer an innovative way to consume or store spare power when renewables produce more than we need.
Benefits of joining a VPP include:
As part of a VPP you’ll be paid for helping to stabilise the grid. The help you provide can come in many forms. Your business might provide energy, store excess energy (for example, batteries during periods of high solar generation) or switch off or reduce energy consumption as needed.
You can be paid a price determined by the wholesale energy spot market or offer to have your services on standby during times of high demand – earning money via the FCAS market.
The Australian Energy Market Operator (AEMO) runs what is known as Frequency Control Ancillary Services (FCAS) markets – it’s a group of power assets on standby to respond quickly when the grid is unbalanced.
As part of a VPP you could be paid to have your assets on standby to help the grid to remain stable. It’s win/win.
The National Electricity Market (NEM) generates a spot price for electricity that reflects supply and demand – a price which updates every five minutes. Sudden changes like extreme weather or interruptions to supply can cause spikes in energy costs.
Hydro’s VPP can give you access to the spot market price to sell your excess electricity (or load reduction capability) when prices look good.
Demand Response is a way for utility companies and grid operators to manage and balance supply and demand of electricity during times of high demand or low supply. It incentivises consumers to change their patterns of energy use – for instance temporarily reducing load when the grid is struggling to meet demand.
To enable Demand Response, Hydro’s VPP uses AI to optimise your assets and automation for rapid response – so you generate maximum revenue while we work within the parameters set up for your business. We also offer the option of an Opt-in/Opt-out function so you can override the automation when needed – at the click of a button.
There are essentially two different groups of assets that can participate in a VPP – they interact with the grid slightly differently.
To join Hydro Tasmania’s Virtual Power Plant you’ll need to get in touch with our team to discuss your assets and figure out if you’re eligible – we'll arrange a back-cast to give you an idea of what you may have been able to earn in the past year or two. From there, we’ll come to an agreement setting out how we’ll operate so it doesn’t disrupt your business. Once setup is complete you can start getting paid.
You’ll receive ongoing support and access to a VPP customer portal, where you can monitor the status of your assets, gain insights on their trading performance, and keep an eye on the wholesale energy market. And if you have a retail contract with Momentum Energy, you’ll get your own account manager.
Your business is responsible for maintaining your energy assets.
It’s possible to include diesel generation as part of Hydro’s VPP, but there are a few conditions. Your diesel generator will either need to use biodiesel or your emissions will need to be offset – to keep things greener.
Your business will always come first – the last thing anyone wants is for your core operations to be disrupted in any way that you don’t want us to. We’ll work around the needs of your business. We’ll always work within your operational parameters, and the warranty conditions of your assets.
Ah, the million-dollar question. (Or maybe not quite a million). We can’t predict the future. However, we can utilise revenue back-cast modelling to offer insights into potential earnings based on the past 12 months or more. Request a backcast.
In case you can’t tell, we’re a bit excited about VPPs and the savvy role they’ll play in Australia’s transition to renewables. If you’re interested in joining Hydro’s VPP or have questions for the team, contact us and we’ll be in touch soon.
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