China’s EV Goals Rely on Virtual Power Plants

Are you wondering the concept of a virtual power plant (VPP)? You are not alone, as it is a complex technology. One of my trusted coworkers, who has a deep understanding of the subject, recently wrote an informative piece on the topic. This led me to further discuss with her about VPPs for this blog post. As it happens, VPP technology aligns exceptionally well with the electric vehicles (EVs) industry, hence the recent interest from the Chinese government.

According to our discussion, VPPs essentially represent a group of distributed energy resources capable of maintaining grid balance. This could include varied sources such as EV chargers, heat pumps, rooftop solar panels, and domestic battery systems for power backups. The idea is to use these coordinated resources to take over the role of central gas or coal power plants while also providing additional benefits for the grid.

The uniqueness of VPPs lies in the central smart system they incorporate. This system facilitates regulated energy consumption and supply, allowing utility firms to manage periods of high energy demand effectively. One strategy could be to schedule EV charging to non-peak hours such as 2 a.m.

According to my coworker, the US government aims to triple VPP capacity by 2030. This capacity increase can prevent the establishment of 80 to 160 fossil fuel plants. The deployment of EV batteries and EV charging infrastructure will play a critical role in achieving this additional VPP capacity.

Given the considerable influence of EVs on the grid, it’s unsurprising that China—currently the fastest player in the EV revolution—has also concentrated on VPPs. By 2023, over 20 million EVs existed on Chinese roads, accounting for nearly half of the world’s total. These vehicles can consume enormous amounts of power, but their batteries can also provide critical backup power. The annual power shortages faced by China underscore the necessity to integrate these millions of EVs into the grid system. Encouragingly, both the Chinese government and local EV firms are making progress in this regard.