Virtual CHP power plants could be an answer to increasing network demand

Virtual power plants could decarbonise electricity supplies, while reducing demand  on the electricity network by harnessing power from small clusters of combined heat and power (CHP) systems.

This could avoid the expense of building additional electrical generating capacity.

That's the conclusion of research undertaken by energy solutions business ENER-G in partnership with Advanced Digital Institute; Flexitricity; Smarter Grid Solutions and UK Power Networks.

Virtual power plants have been described as the 'internet of energy'. They use complex software and a central control system to tap into existing distributed generation capacity - linking demand and supply - to improve the wider performance of the electricity system..

The research consortium has undertaken extensive simulation and modelling, using real data from ENER-G CHP systems and UK Power Networks' London electricity network. This has demonstrated the scale of the opportunity for tapping into existing low carbon decentralised CHP supply network to relieve peaks in electrical demand as a more cost-efficient way of increasing network capacity and performance.

Additionally, the closure of baseload power stations and rising future demand for power - prompted by factors such as the move to electric cars, rising summer temperatures, and cold winters - is prompting a call for new solutions to increase the resilience of the national power supply.

"We face the twin challenges of improving power resilience, while also decarbonising supplies", said Chris Marsland, Technical Director for ENER-G Combined Power Ltd. "Simply burying more copper in the ground and building additional large power plants to expand the existing system is unsustainable - both environmentally and from a cost point of view.  But active virtual power plants - using clusters of highly energy efficient CHP units that communicate via a decentralised smart-grid - can provide the low carbon, cost effective answer to these challenges."

The latest Department for Energy and Climate Change (DECC) statistics for 2011 to 2012 show that UK  CHP capacity is  6.1GW and meets 6.4% of the UK’s total electricity needs. The CHP driven virtual power plant would link this plentiful CHP generating capacity to the distribution network operator (DNO) network. This could work by allowing dense CHP clusters in urban areas to be built into a technical commercial system that would respond to pricing/demand signals from the network by exporting power.

The initial feasibility study has been funded by the Technology Strategy Board, the UK’s innovation agency. The next research phase is to trial the implementation of an active CHP virtual power plant and volunteer sites are currently being sought. 

It is also necessary to evaluate options for market exploitation - taking into account the complex relationships between distribution companies, transmission companies, regulators, aggregators, CHP operators and stakeholders, and the incentives and regulation required to move forward.

Initial modelling has shown that heat storage is highly beneficial in reducing the cost of CHP operation and in improving environmental performance. Further study would examine the potential for using district heating networks to utilise the full heating and cooling potential of CHP.  

The consortium believes that Active CHP virtual power plants would encourage the growth of the CHP industry. Pike Research has estimated that the global market for Virtual Power Plants could be worth $7.4 billion by 2015.

Chris Marsland added: "We are excited by the potential of virtual power plants and the contribution it could make to improving the resilience of the UK electricity network. There is tremendous potential to export our UK know how to the rest of Europe and beyond."


Notes to editors

ENER-G plc ( is a UK energy services and technology business and a global leader in small scale cogeneration and biogas generation. The company, which has operations in 20 countries,  powers cost and carbon reduction – investing in and delivering complete end-to-end solutions for all commercial and industrial requirements. These include every aspect of energy management and energy demand reduction, from consultancy, controls, combined heat and power manufacture and operation, to energy from biogas and new generation energy from waste.

Flexitricity brings new revenue and increased asset reliability to UK businesses, while reducing carbon emissions and risk in the national electricity system. Flexitricity uses Britain's most advanced smart grid system to unlock the hidden flexibility of commercial energy users and small generators. The organisation ensures that  energy users earn revenue by helping secure electricity supplies and supporting the renewable energy

Grid Solutions ( is at the forefront of smart grid technology. It enables power companies and utilities to increase their existing grid capacity in order to connect more renewable energy and respond to the global rise in demand for electricity. This is a more affordable and sustainable approach than building new grid infrastructure.

UK Power Networks distributes more than a quarter of Britain’s electricity through its networks of substations, underground cables and overhead lines making sure the lights stay on across London, the South East and the East of England.

The company was named Utility of the Year 2012 in the prestigious Utility Industry Achievement Awards. Its 5,200 employees are dedicated to delivering a safe, secure electricity supply to 8.1million homes and businesses regardless of who they pay their energy bills to.

The industry regulator Ofgem sets an allowed revenue to distribution companies so that they can maintain safe and reliable electricity supplies.

UK Power Networks is investing around £1.8billion in its electricity networks in the five years to 2015 and also undertaking trials to ensure that electricity networks support the transition to a low carbon future. It also maintains and upgrades power equipment, and moves and connects new electricity cables.

If customers are unfortunate enough to be affected by a power cut or have another issue with the electricity supply to their property, they should contact UK Power Networks.

The Advanced Digital Institute (ADI) is an independent research and development company based in Saltaire, West Yorkshire, United Kingdom.  ADI stimulates and delivers commercial research and business innovation through direct, hands-on collaborative engagement. ADI provides specialist engineering research and development, technical and business know-how, impartial advice and industry insight.

T... Strategy Board is the UK’s innovation agency.  Its goal is to accelerate economic growth by stimulating and supporting business-led innovation.  Sponsored by the Department for Business, Innovation and Skills (BIS), the Technology Strategy Board brings together business, research and the public sector, supporting and accelerating the development of innovative products and services to meet market needs, tackle major societal challenges and help build the future economy. For more information please visit

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