The penetration of renewable energies in the energy market has increased significantly over the last two decades due to environmental concerns and clean energy requirements. The principal advantage of renewable energy resources (RESs) over non‐RESs is that it has no direct carbonisation impact on the environment and that it has none of the global warming effects which are caused by carbon emissions. Furthermore, the liberalisation of the energy market has led to the realisation of the virtual power plant (VPP) concept. A VPP is a unified platform for distributed energy resources that integrates the capacities of various renewable energies together for the purpose of improving power generation and management as well as catering for the buying and selling of energy in wholesale energy markets. This review study presents a comprehensive review of existing approaches to planning, operation and scheduling of the VPP system. The methodologies that were adopted, their advantages and disadvantages are assessed in detail in order to benefit new entrants in the power system and provide them with comprehensive knowledge, techniques and understanding of the VPP concept.

The arrival of virtual power plants (VPPs) marks important progress in the energy sector, providing optimistic solutions to the increasing need for energy flexibility, resilience, and improved energy systems’ integration. VPPs harness several characteristics to bring together distributed energy resources (DERs), resulting in economic gains and improved power grid reliability. Nevertheless, VPPs encounter major challenges when it comes to engaging in energy markets, mainly because there is no all-encompassing policy and regulatory framework specifically designed to accommodate their unique characteristics. This underscores the necessity for research endeavours to develop more advanced methods and structures for the long-term viability of VPPs. To address this concern, the study advocates for the implementation of a multi-aspect framework (MAF) as a systematic approach to thoroughly examine each aspect of virtual power plants (VPPs). A STEEP (social, technological, environmental, economic, and political) analytical tool is utilized to evaluate the challenges, opportunities, and benefits of a VPP in the existing energy markets. The proposed approach highlights important factors and actions that need to be taken to tackle the challenges related to VPP’ entry into energy markets. This study suggests that further support is required to promote the fast and widespread adoption of long-term VPP implementations. For this reason, a more favourable policy and regulatory framework based on social, technological, economic, environmental, and policy considerations is necessary to realize the genuine contributions of VPPs.

The penetration of renewable energy sources (RESs) in the electrical power system has increased significantly over the past years due to increasing global concern about climate change. However, integrating RESs into the power market is highly problematic. The output of RESs such as wind turbines (WTs) and photovoltaics (PVs) is highly uncertain. Their correlation with load demand is not always guaranteed, which compromises system reliability. Distributed energy resources (DERs), especially demand response (DR) programs and energy storage systems (ESSs), are possible options to overcome these operational challenges under the virtual power plant (VPP) setting. This study investigates the impact of using a DR program and battery energy storage system (BESS) on the VPP’s internal electricity market, and also cost-minimization analysis from a utility viewpoint. Three different constrained optimal power flow (OPF) problems are solved such as base case, DR case, and BESS case to determine total incurred costs, locational marginal prices (LMPs), and generator commitments. A scenario tree approach is used to model the uncertainties associated with WTs, PVs, and load demand. The proposed model is investigated on a 14-bus distribution system. The simulation results obtained demonstrate a favorable impact of DR and a BESS on renewable operational challenges.

This study provides an overview of virtual power plants as aggregated flexibility service providers in distribution systems. The integration of photovoltaic energy sources increases uncertainty regarding the operation of distribution grids, impacting power quality. Innovative ideas are therefore needed to support the migration of traditional systems toward a smart grid. A virtual power plant could make use of the flexibility of emerging technologies to address these power quality and grid operation issues. To this end, this study introduces a new concept describing a location‐specific interactive flexibility market framework in the context of a virtual power plant setting. In this proposed setting, flexibility providers (i.e. prosumers) can support location‐based services in distribution systems. These services would reasonably alleviate the need to upgrade or substitute power capacity cost‐effectively and facilitate the reliable and safe operation of the distribution grid. A direct control algorithm is designed and developed for the market studied, which was implemented to verify its efficacy experimentally. The efficiency of the proposed mathematical model and method is confirmed by the results of a case study using the UK‐16 busbar generic distribution system, and finally some specific conclusions are drawn regarding the application of the proposed method.

The power systems of today seem inseparable from clean energy sources such as wind turbines (WTs) and photovoltaics (PVs). However, due to their uncertain nature, operational challenges are expected when WT and PV energy is added to the electricity network. It is necessary to introduce new technologies to compensate for the intermittent nature of renewable energy sources (RESs). Therefore, rationally implementing a demand response (DR) program with energy storage systems (ESSs) in a virtual power plant (VPP) environment is recommended as a way forward to minimize the volatile nature of RESs and improve power system reliability. Our proposed approach aims to maximize social welfare (SW) (i.e., maximization of consumer benefits while minimizing energy costs). Our method assesses the impact of the DR program on SW maximization. Two scenarios are examined, one with and one without a DR program. Stochastic programming theory is used to address the optimization problem. The uncertain behavior of WTs, PVs, and load demand is modeled using a scenario-based approach. The correctness of the proposed approach is demonstrated on a 16-bus UK generic distribution system. Our results show that SW and active power dispatch capacity of WT, PV, and ESS are fairly increased using the proposed approach.

Renewable energy sources (RESs) are becoming more prevalent as a source of clean energy, and their integration into the power market is speeding up. The fundamental reason for this is the growing global concern about climate change. However, their weather-dependent and uncertain nature raise questions about grid reliability particularly, when photovoltaics (PVs) and wind turbines (WTs) technologies are used. As a result, rationally managing Energy Storage Systems (ESSs) under the virtual power plant (VPP) setting is being encouraged as a way of minimizing the impact of the uncertain nature of renewable energies. A VPP is comparatively a new concept that aggregates the capacities of dispatchable and non-dispatchable energy sources, electrical loads, and energy storage systems for the purpose of improving energy supply and demand imbalance. It enables individual consumers and producers to participate in the power markets. In this study, a new market-based (MB)-VPP operational planning model is designed and developed with the aim to evaluate the optimal active power dispatched by (WT, PV, and ESS) operating in the day-ahead power market to maximize the social welfare (SW) of the market. SW can be described as the maximization of the consumer’s benefit function minus the cost of energy generation. The optimization process was carried out by using a scenario-based approach to model the uncertainties of renewable energy sources (i.e, WTs & PVs) and load demand. The proposed model and method performance is validated by simulation studies on a 16-bus UK generic distribution system (UKGDS). The simulation results reveal that the proposed approach maximizes overall system social welfare. The capacity of total active power dispatched by (WT, PV, and ESS) has a positive impact on the VPP profit maximization. This empirical study could be used as a reference baseline model for other energy services providers interested in conducting similar research in the future.