The global market for flexible energy capacity will nearly triple between 2020 and 2029, according to Guidehouse Insights.
The energy industry is expected to increase flexible energy capacity from 55.8GW to 150.3GW during the forecast period.
The use of demand response and virtual power plants is being driven by increased renewable energy penetration, market deregulation, climate targets, and increased developments of neural grid networks.
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Evolving strategies and frameworks for distributed energy resources and virtual power plants are providing additional benefits to energy consumers and the larger grid.
On the other hand, barriers slowing the otherwise rapid growth of flexible capacity include regulatory requirements, programme scale, COVID-19 and the grid independence movement.
Jessie Mehrhoff, a research analyst with Guidehouse Insights, said: “Legacy DR programmes are evolving from manual direct load control switch programs toward that of bring your own device (BYOD), which embraces a swath of behind-the-meter (BTM) DER technologies found across customer segments.
“Simultaneously, flexible capacity from BTM and in front of the meter is being aggregated and optimised to contribute to broader grid reliability to provide the same essential purposes as a traditional 24/7 power plant. Through this VPP strategy, passive energy consumers can be transformed into active prosumers, delivering services tailored to their needs and preferences and those of the larger grid.”