Virtual Power Plants: Pilots, Challenges, and Innovations Shaping Future Development

Journal Article · Fri Oct 24 00:00:00 EDT 2025 · IEEE Power and Energy Magazine

DOI:https://doi.org/10.1109/MPE.2025.3587184· OSTI ID:3014856

Ding, Fei ^[1]; Utkarsh, Kumar ^[1]; Dugan, Jesse ^[1]; Speetles, Brittany ^[1]; Choi, Seong ^[1]; Kroposki, Ben ^[1]

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1. National Laboratory of the Rockies, Golden, CO (United States)

Virtual Power Plants (VPPs) aggregate distributed energy resources (DERs) to provide grid services traditionally delivered by centralized power plants. This article reviews the current state of VPP deployment, highlighting business models, compensation mechanisms, and global pilot projects. While VPPs offer benefits such as grid flexibility, resilience, and cost savings, challenges remain in communication infrastructure, regulatory frameworks, market access, and customer engagement. To address these, we propose a scalable, privacy-preserving hierarchical VPP architecture that coordinates with distribution utilities and preserves customer data. We also present the Integrated T&D Control Room of the Future as a key test bed for validating and accelerating VPP adoption. These innovations can help transition VPPs from pilot programs to integral components of a modern, reliable power grid.

• Research Organization: National Laboratory of the Rockies (NLR), Golden, CO (United States)
• Sponsoring Organization: USDOE Office of Cybersecurity, Energy Security, and Emergency Response (CESER)
• DOE Contract Number: AC36-08GO28308
• OSTI ID: 3014856
• Report Number(s): NLR/JA-5D00-93670
• Journal Information: IEEE Power and Energy Magazine, Journal Name: IEEE Power and Energy Magazine Journal Issue: 6 Vol. 23
• Country of Publication: United States
• Language: English

Related Subjects

24 POWER TRANSMISSION AND DISTRIBUTION
29 ENERGY PLANNING, POLICY, AND ECONOMY
32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATION
business
computer security
costs
distributed power generation
electricity supply industry
interoperability
life estimation
power grids
reliability
resilience
resource management
virtual power plants