Global Virtual Power Plant (VPP) Market Set to Attain Over $5,000.0 Million Revenue by 2023

Due to the rising production of energy from renewable sources, the demand for virtual power plants will increase across the world in the coming years. As per several reports and studies, the share of renewable energy sources in power generation throughout the world is expected to rise from 7% in 2015 to 20% by the end of 2035. The setting up of renewable power projects will lead to the generation of huge quantities of energy, which will require a well-developed power evacuation infrastructure for their reliable supply, thereby leading to the development of virtual power plants across the globe.

 

The increasing power outages in several countries such as India, Nigeria, and Indonesia, on account of acute power shortages in these countries because of the ageing and inadequately equipped power infrastructure, is another important factor responsible for the ballooning development of virtual power plants. Due to these factors, the value of the global virtual power plant (VPP) market is expected to increase from $1,975.1 million to $5,510.2 million from 2017 to 2023. The market is also predicted to progress at a CAGR of 18.6% during the forecast period (2018–2023).

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The biggest trend currently being observed in the virtual power plant market is the increasing number of investments for the development of new virtual power plants all around the world. The virtual power plants consist of a centralized control system connected to power producing and supplying units and therefore, require lower amounts of capital for their construction and management than the conventionally used power plants. Moreover, these power plants can integrate several distributed energy resources. Due to these factors, many major power plant manufacturing companies are shifting their focus toward the development of virtual power plants.

 

Globally, the Middle East and Africa (MEA) region is expected to register the fastest growth in the adoption of virtual power plants during the forecast period, due to the development of multiple renewable power projects in the U.A.E., Saudi Arabia, and South Africa. These countries have been traditionally dependent on the conventional sources of energy such as oil, gas, and coal for power generation but since the last few years, there has been a huge increase in the need for renewable energy there, due to the pollution caused by the large-scale use of the conventional energy sources.