How to connect a virtual power plant: Cloud APIs and edge devices
Who this article is for:
Energy retailers and asset fleet managers who want to build and operate a virtual power plant (VPP).
Previously we looked at the role of distributed energy resource (DER) owners in the customer-centric virtual power plant (VPP), and the broader role of VPPs in the evolving grid. This article focuses on the role of cloud APIs and edge software in connecting DER assets to a VPP.
If you want to run a VPP, one key challenge is deciding how to connect the distributed energy assets (DER) that will make up the VPP, because connectivity options (and even control capabilities) vary between equipment manufacturers and different models of the DER types that promise the most value for a VPP operator - solar inverters, battery storage systems and electric vehicle chargers & charging stations.
This article provides an overview of the two main DER connectivity options for VPP operators: Cloud APIs and edge devices.
VPP basics
The basic elements of a VPP are:
a VPP platform (also referred to as a distributed energy resource management system, or DERMS),
the DER assets that constitute the functional aspect of the VPP, and
a way to connect the platform to the assets.
The VPP platform instructs the assets how to respond to a range of factors like market fluctuations or local network conditions.
These individual assets can be large, medium, or small and can sit ‘behind the meter’ (BTM - at a home or business, impacting their energy bills), or ‘in front of the meter’ (FTM - existing specifically to provide market or network services to others).
What is a cloud API in the context of a virtual power plant?
A cloud application program interface (cloud API) is an interface for one piece of software to talk to another piece of software over the internet. Cloud API’s also define how the conversation takes place, and what data can be exchanged. Most inverter, battery and EV charger manufacturers these days provide some level of cloud API access to their devices, but not all of them allow for control of assets (which is necessary for a VPP) over cloud API.
In the case of a VPP, the two pieces of software are the VPP operator’s DERMS and the equipment manufacturer’s cloud platform (the OEM’s cloud API), which relays data and control commands to and from individual devices. The cloud platform communicates with the devices in the field over the public internet.
The parameters exposed in a cloud API can vary significantly by manufacturer (and sometimes even with the same manufacturer). These parameters include:
the data types and control capabilities that the OEM makes available (e.g. ability to discharge or charge a battery and to what level)
the frequency at which data can be sent (e.g. every 5 minutes, every minute or every few seconds)
the granularity of the data transmitted (e.g. sub-second, 1-minute, 5-minute)
Top three problems that cloud API connections help VPP operators solve:
Speed to onboard existing systems: Cloud APIs allow VPP operators to enrol large groups of DER assets easily into their VPP in a single batch
Complexity of installation: Cloud APIs do not require additional hardware, so the only equipment required is the DER asset itself, simplifying the installation process
High costs of retroactively adding assets: Using a cloud API saves on labour and hardware costs
What is an edge device in a virtual power plant?
In the context of a VPP, an edge device is a piece of hardware that connects to one or more DER, at a minimum providing a secure means to connect to the VPP via the public internet. Edge devices can also be protocol translators for one or more brands of equipment, and - depending on how much compute power they have on board - can function as ‘edge’ controllers that let them autonomously implement smart management functions on-site without requiring inputs from a cloud management platform.
Many original equipment manufacturers (OEMs) have their own edge devices (sometimes called ‘gateways’) that plug into their own, otherwise ‘dumb’ inverters and batteries to allow them to connect to the internet, usually for system performance monitoring but in some cases also to enable some autonomous control at the site level and potential participation in VPPs.
At the more advanced end of the spectrum, third party edge devices like SwitchDin’s hardware Droplets solve the connectivity challenge for a range of DER types and brands (including diverse devices at a site or across fleets) while also bolstering security and enabling standardisation for easier fleet orchestration, optimisation and data analysis.
Top four problems that edge devices help VPP operators solve:
Complexity and diversity in DER functionality: There is no national standard for DER connectivity or VPP operation, and the types of data and functions available through a cloud API can vary significantly from one manufacturer to the next; edge devices help to standardise connectivity and functionality across diverse fleets, simplifying VPP operation and improving reliability
Changing requirements: Most inverters and battery storage systems are built for compliance to grid safety standards, but not necessarily to do more; an edge device can add an additional layer of smarts & functionality that evolves with changing circumstances so VPP operators - and their customers - can take advantage of new opportunities
High operational costs: Manufacturers generally charge cloud API subscription fees, which can be based on the frequency of data calls requests as well as the number of units enroled; a VPP operator may need to pay these fees, plus data transfer costs, plus VPP platform costs when using cloud APIs for their connections. Edge devices like Droplets connect DER assets into the VPP platform directly, without the need to pay for a third party cloud API to the device.
Behind-the-meter optimisation for multiple assets: Depending on its level of sophistication, edge devices (like Droplets) can intelligently coordinate assets in real-time without regular input from a cloud platform, and can help to deliver value by bolstering bill savings and/or energy independence. This level of BTM optimisation is also possible with cloud APIs, but pushing control capabilities down to an edge device reduces the need for cloud resources and improves scalability of the overall VPP.
You can mix cloud APIs and edge device connections in the same VPP
Virtual power plants are about supporting grids and participating in markets by better coordination of DER assets, and the question of how to connect assets is secondary to what the goals and opportunities are.
The key challenge that needs addressing here is how to ensure that the VPP platform is able to accommodate both types in a uniform way, so that the VPP behaves predictably and delivers the value that the operator expects.
Edge devices and cloud APIs: SwitchDin’s approach
As an energy software company who bridges the gaps between asset owners, manufacturers and energy companies, SwitchDin’s takes a whole-of-system approach to DER management, plugging holes and solving problems that any one of these individual entities are not in a position to solve on their own.
Here’s how we do it.
Stormcloud: A universal VPP management and DER orchestration platform
Stormcloud enables device-to-control-room management of VPPs from a single platform for the most popular equipment brands in the market - including solar inverters, batteries and electric vehicle chargers.
Stormcloud is structured in line with IEC 61850, creating a uniform architecture for incoming and outgoing data - regardless of the manufacturer of the DER equipment model, and regardless of whether the device is connected via a hardware Droplet or a cloud API (Cloud Droplet).
Stormcloud allows energy retailers to run mixed-asset fleets of DER as part of virtual power plants.
Droplet hardware & eDroplet edge software
We’ve designed hardware Droplets and embedded eDroplet software with orchestration, optimisation and cybersecurity in mind, and to deliver maximum possible flexibility.
In addition to the general challenges that edge devices can help to solve, our Droplets also help to solve the connectivity challenge for VPP operators where:
The DER assets do not have inbuilt internet connectivity capabilities, and Droplets make OEM equipment smarter and VPP-ready);
There are multiple devices from different manufacturers at a single site and a need to coordinate these devices locally, in real time for functions like peak shaving and tariff optimisation;
There are cybersecurity requirements from the government or VPP operator requiring that servers for cloud APIs must be located in the same country as the VPP (e.g. Australian servers for an Australian VPP);
The default capabilities provided by an OEM’s cloud API do not meet the requirements of the VPP operator; or
There is a strong need or requirement for ‘future-proof’ control & management: Droplets are designed to quickly and easily meet changing requirements to move with the times - even for older DER devices that may not be supported by the original manufacturer anymore.
Cloud Droplets for cloud API connections
APIs are a crucial part of DER orchestration, and SwitchDin enables connections with OEM cloud APIs via Cloud Droplets. Cloud Droplets operate as nodes within Stormcloud so that VPP operators can build and run VPPs composed of diverse fleets of assets from a single control room.
Cloud Droplets add value to OEM cloud APIs by providing many of the same tools as hardware Droplets, but without additional hardware. Cloud Droplets unlock new features and capabilities built on top of the parameters available through a manufacturer’s cloud API by layering in additional capabilities such as optimisation for savings & self consumption and advanced data analytics.
The ability for a VPP to function ultimately rests on internet connectivity as it is the ‘glue’ that makes VPPs operational. Deciding on whether a cloud API or edge device is the right solution in a particular VPP and for a particular site is a design and cost consideration that operators need to examine closely.