VPPs in action

According to the Oxpeckers’ #PowerTracker tool, there are fewer than five virtual power plants in South Africa. Umoyilanga, still under construction, is one such example.

Developed by French renewable energy company EDF Renewables and funded by Rand Merchant Bank, the project combines solar, wind and battery storage technologies to offer dispatchable and reliable power to the national electrical grid. Umoyilanga will operate as a virtual power plant, combining generation from two sites which are 900km apart.

The next step is demonstrating that individual homes can operate as part of a coordinated electricity system.

Plentify’s Project Smart Solar is currently recruiting around 280 homes and businesses in eThekwini to coordinate rooftop solar, battery storage and electric geysers in what will become one of South Africa’s largest residential VPP demonstrations.

Although results are not yet available, Kornik said homeowner interest has been encouraging.

Countries such as Australia, Germany, the United States, Japan and Norway have already deployed commercial VPPs to balance electricity demand, integrate renewable energy and reduce pressure on ageing grids.

Norway, in particular, offers lessons for South Africa.

Svein Jørgen Sønning, chief commercial and technology officer at NODES, an independent, technology-driven marketplace that enables grid operators and energy providers – including VPPs – to trade decentralised energy flexibility, said regulators should not wait for perfect policy before testing the technology.

“One of the most important lessons is to start with practical initiatives rather than waiting for a perfect regulatory framework,” he told Oxpeckers.

Norway now allows commercial aggregators to combine flexibility from buildings, batteries and industrial facilities before trading those services into electricity markets. Distribution companies increasingly use this flexibility to manage network congestion instead of immediately investing in expensive grid upgrades.

“The results have been positive and encouraging,” Sønning said.