BANGALORE, India | 28th July 2020: A virtual power plant is a cloud-based distributed power system that aggregates the capacity of heterogeneous distributed energy resources, such as wind farms, solar parks, and combined heat and power (CHP) units. The Virtual Power Plant is used to relieve the load on the grid by smartly distributing the power generated by each unit during peak load periods. The combined power generation and power consumption of the networked units in the Virtual Power Plant shall also be traded on the energy exchange.

The global virtual power plant (vpp) market size was valued at USD 1.3 Billion in 2019 and is projected to reach USD 5.9 Billion by 2027, growing at a CAGR of 21.3% from 2020 to 2027.

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Growing penetration for renewable energy in the power generation sector, coupled with changes in power grid dynamics from centralized to distributed, is expected to drive the growth of the virtual power plant market size.

Furthermore, the decreases in energy prices and quick access to energy storage are expected to fuel the growth of the virtual power plant market size.

The virtual Power plant is more effective and versatile in delivering peak load electricity in a short notice time compared to a traditional power plant set-up. Flexibility in trading with virtual power plants attracted several new participants due to market volatility. On the exchange market, consumers can sell excess energy as well as buy energy at a lower price. These features are, in turn, expected to fuel up the demand for virtual power plant market size during the forecast period.

Strict government regulations on environmentally friendly power generation would further boost the renewable energy sector, thereby increasing the growth of the virtual power plant market size.

High frequency of electromagnetic and radio waves contributes to health problems in infants and the elderly, which could hamper this development.

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The Industrial segments are expected to hold the largest Virtual Power Plant Market share in terms of revenue. The growing use of small and medium-sized Virtual Power Plants in industrial sectors would drive the growth of Virtual Power plant market size.

Based on region, Europe accounted for the largest Virtual Power Plant Market share due to the involvement of a large number of industry players and new government programs in different European countries with 100 percent renewable energy.

Asia-Pacific region is expected to witness the highest growth rates during the forecast period. This is due to the growing demand for energy in fast industrializing countries such as China and India.

The US is expected to lead the North American market and bear witness to the high demand for virtual power plants due to the rising demand for renewable energies.

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As compared with fossil fuel-based power generation, renewable energy is more costly. Countries across the globe are veering towards sustainable sources of power generation due to environmental conservation and increased awareness.

Though the market is distributed with many regional companies, major players dominate the Virtual Power Plant Market. Major players have adopted product launch, company expansion to maintain intense competition in the industry.

The top companies in the Virtual Power Plant Market include ABB Ltd., AGL Energy, AutoGrid Systems, Inc., Enbala Power Networks, Enel X Inc., General Electric Company, Siemens AG, Schneider Electric SE, Limejump Ltd., and others.


  • Distribution Generation
  • Demand Response
  • Mixed Asset


  • Commercial
  • Industrial
  • Residential

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