New South Wales is celebrating the launch of its first large-scale virtual power plant (VPP), aimed at managing the reliable supply of electricity during peak periods to avoid blackouts and price spikes.
Enel X will operate three large-scale VPPs across the state. The projects are among four being underwritten by the State Government as part of the NSW Electricity Roadmap’s first firming tender, to ensure more renewable energy projects get built to replace ageing coal-fired power plants.
The three VPPs will involve 21 businesses at 108 sites across Greater Sydney, Central Coast, Newcastle and Illawarra.
The major power users – including heavy industry, factories, retail, universities, data centres and food producers – will be orchestrated to use less energy at the same time via the VPP, which the State Government said has the same effect as bringing a physical power plant online.
The first VPP under the Roadmap has been launched by New South Wales Minister for Climate Change and Energy, Penny Sharpe, during a visit to one of the participants, Visy Recycling, in Western Sydney.
When all three are operational by summer 2025, they are expected to have a combined capacity of 95MW of demand response. This could free up enough electricity to power more than 30,000 homes for two hours during times of peak demand, at short notice if needed, to keep the lights on and the grid stable.
The businesses involved will be compensated to adjust their energy use when the grid needs it most, which the State Government said is anticipated to be no more than a few times a year. It offers a low-cost alternative to building more large-scale generation projects that may only be used a few times a year.
The New South Wales Government said it is delivering a reliable, affordable energy system that benefits communities and the economy and ensures energy security for the state.
Ms Sharpe said the launch of the VPP marks a major milestone in the state’s clean energy transformation.
“It’s another innovative resource to keep the lights on and put downward pressure on energy prices for all homes and businesses as coal-fired power stations exit the system,” she said.
“Through initiatives like this, industry, businesses and our major cities are stepping up to play a vital role in shaping our renewable energy future.”
New South Wales Member for Granville, Julia Finn, said she is thrilled to see businesses in Western Sydney actively contributing to easing pressure on the energy grid during peak periods, such as during cold snaps and heat waves.
“Industries are showing how smart energy use can help power New South Wales more reliably. This is about backing businesses to be part of the solution.”
Enel X Australia Country Manager, Carl Hutchinson, said, “We’re proud to deliver the latest tool for the state to protect homes and businesses from blackouts and high prices during periods of peak demand.
“This isn’t just a win for the grid, it’s a win for New South Wales businesses that are stepping up to play a critical role in keeping our grid secure while earning revenue for doing so.”
