Virtual Power Plants and Machine Learning could be critical elements of energy network management

The smart money may be on machine learning when it comes to National Grid, but Virtual Power Plants may be another critical piece in the network management puzzle according to industry commentators.

A recent article by US-based investment and tech analyst, Jonathan Sheiber, would suggest that the smart money is moving into automation and machine learning in the electricity distribution sector. Focusing on the US National Grid, and in particular its new investment arm National Grid Partners, Sheiber suggests that the energy generator is targeting its innovation spend on technology that will virtually monitor, manage and control its network.

Although perhaps not revolutionary in investment terms – witness Fundamental’s own fusion with Australian-based SystemCORP Energy in July last year – it is an increasingly clear direction of travel for the electricity distribution network as a whole. Commenting in the article, National Grid Partners Founder and President, Lisa Lambert, said: “AI will be critical for the energy industry to achieve aggressive decarbonisation and decentralisation goals.” The statement is backed by hard cash, with NGP already investing some $135m (£100m) in machine learning-focused companies.

Virtual innovation

The need for this type of innovation is not only highlighted in, but will be rewarded by, UK regulator Ofgem’s RIIO-2 controls as the UK’s network operators are forced to look at greater efficiencies and lower costs to consumers.

And it is not just machine learning that will be required.  The drive towards a Net Zero grid is going to involve significantly greater dependence on renewable energy, flexible grids and energy trading. To that end, SSE’s Head of Strategy, Emma Davidson, believes that Virtual Power Plants could play a critical role.

According to Davidson, VPPs: “make quicker, aggregated responses from a variety of assets possible and ensure that energy consuming and/or producing assets are used in a way that better supports the UK’s energy system.” She notes that the sources of power that need to be balanced are increasing, including battery storage, and this means complex and sophisticated solutions to manage them.  

The role of the VPP is to “facilitate” the interaction between the end-user and power generators - whether large national/regional organisations or small local sources - with the DSOs and National Grid as part of the mix.  Davidson suggests that with this model in place, there is a greater opportunity to encourage the smaller-scale generators and stimulate flexible markets.