The global virtual power plant market size is expected to reach USD 3,724.2 million by 2028 registering a CAGR of 28.6% over the forecast period. This growth can be due to factors such as rising government initiatives to implement renewable energy sources, which is driving renewable power generation activities. Other factors driving adoption of virtual power plants include rapid urbanisation and an increasing emphasis on decarbonization, as well as the rapid digitalization trend, which is expected to continue during the forecast period. Another factor driving demand for virtual power plants is rising energy consumption, which necessitates monitoring and increasing renewable energy output.
The virtual power plants market is growing due to technological advances on the conventional power grid for the construction of a modern smart decentralised grid with bi-directional electricity. Another factor driving demand for virtual power plants is the global move toward renewable and distributed energy production. Growing demand for a low-carbon future, as well as smaller and decentralised power generation units, are expected to provide future growth opportunities for virtual power plant market players. The use of cost-effective renewable sources of power generation, such as solar, wind, and hydro, is helping to push the virtual power plant market forward, and this trend is expected to continue over the forecast period. Another factor expected to drive demand for virtual power plants is the increasing need to minimise dependency on fossil-fuel-based power generation.
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Some Key Highlights in the Report
- ABB announced a strategic alliance with AFC Energy, a supplier of hydrogen generation technology, in December 2020. The partnership was established with the aim of developing next-generation high-power electric vehicle charging solutions that are sustainable in grid-constrained areas.
- In 2019, the residential segment had the highest market share of 61.4 percent. In the residential sector, the introduction of emerging technologies such as smart metres, smart home appliances, and fully functioning smart grids is driving the growth of virtual power plants.
- During the forecast period, demand response segment revenue is projected to grow at a rapid CAGR of 29.1%. Demand response solutions market is being fueled by the investments in demand response solutions due to the benefits they offer, such as peak load control.
- In 2020, North America contributed the largest revenue share to the global virtual power plant industry. The use of virtual power plants in North America is being boosted by the introduction of stringent government regulations regarding greenhouse gas emissions and the increasing trend of green energy in countries in the region.
- Key players in the market include ABB, AutoGrid Systems, Inc., Blue Pillar, Cisco systems, Inc., Cpower Energy Management, Enel X, General Electric, Hitachi, Ltd., IBM, and Next Kraftwerke.
Emergen Research has segmented the global virtual power plant market on the basis of end-use, technology, and region:
- End-use Outlook (Revenue, USD Million; 2018–2028)
- Industrial and Commercial
- Technology Outlook (Revenue, USD Million; 2018–2028)
- Distributed Generation
- Demand Response
- Mixed Asset
- Regional Outlook (Revenue, USD Million; 2018–2028)
- North America
- Rest of Europe
- Asia Pacific
- South Korea
- Rest of APAC
- Latin America
- Rest of LATAM
- Middle East & Africa
- Saudi Arabia
- Rest of MEA
- North America
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