Virtual Power Plants and Swarm’s Hub:One Home Energy Management System
The UK’s energy sector is undergoing a big transformation. Coal is officially out (the last coal-fired power station will close this year, 2024) and both gas and oil are declining as the electrification of our systems continues to roll out.
But further change is afoot. Due to the nature of renewables, there will be a move away from centralised power generation towards a more decentralised and digital future. This shift, whilst promising for sustainability and hitting emission reduction targets, presents new challenges in maintaining grid stability.
Historically, large power plants have been the backbone of grid stabilisation. Now, with the increasing share of intermittent energy sources like wind and solar, coupled with the rise of new energy-hungry technologies like electric vehicles and heat pumps, the need for flexibility in both energy generation and consumption has never been more important.
This change isn’t as simple as replacing one type of power plant with another. It requires a deeper rethinking of how we generate, distribute and consume energy. The future energy grid needs to be smarter, more responsive and capable of handling two-way energy flows. This is where technologies like Virtual Power Plants and advanced home energy management systems come into play.
What are Virtual Power Plants?
Virtual Power Plants (VPPs) are an innovative solution to these emerging challenges. They represent a move away from traditional centralised power plants, instead creating a flexible network of distributed and diverse energy resources.
VPPs are sophisticated systems that may take a little while to get to grips with. Essentially they bring together multiple ‘Distributed Energy Resources’ (DERs). These are smaller and separated energy resources, which can include:
- Residential solar panels
- Small-scale wind turbines
- Battery energy storage systems
- Electric vehicles
Benefits of Virtual Power Plants
By coordinating these different resources, VPPs can respond efficiently to demand and grid conditions, allowing them to effectively manage energy production, storage and distribution.
The beauty of VPPs lies in their ability to make the most of small-scale energy resources. Whilst a single home solar panel system might seem insignificant in the grand scheme of the national grid, when thousands of these systems are coordinated through a VPP, they can have a significant impact.
This aggregation allows for more efficient use of renewable resources, helps balance the grid, and can even reduce the need for expensive gas-powered peaker plants that are only used during times of high demand.
You can get larger, wholesale VPPs too. These often combine large-scale renewable energy sources, such as wind and solar farms.
The benefits of VPPs extend beyond grid stability. They can enhance overall energy efficiency, reduce carbon emissions and even lead to cost savings for both energy providers and consumers.
VPPS and Home Energy Management Systems (HEMS)
To control this complex and intricate flow of spread out renewable energy, you need an extra smart system – something more than your regular smart meter. You need a Home Energy Management System (HEMS).
HEMS are a comprehensive solution, giving homeowners full control over not just their own energy use, but all aspects of energy from generation to storage and consumption. Unlike traditional smart home systems that might focus primarily on temperature control, HEMS provides an all-round approach to energy management across multiple devices and sources.
Whilst systems like Nest or Hive have made excellent strides in optimising heating and cooling schedules, HEMS goes several steps further. It integrates with a broader set of energy systems, including renewable energy sources and storage solutions.
This allows for all sorts of extras including:
- Real-time analysis and optimisation of energy use patterns
- Adjusting the operation of connected devices based on current data and grid demand
- Assessing market energy prices
- User preferences
- Selling energy back to the grid at the most profitable price
Benefits of HEMS
For UK homeowners, there are many benefits to HEMS.
Beyond the obvious advantage of reduced energy bills through better efficiency, these systems provide detailed monitoring capabilities, offering real-time data and historical insights into energy consumption and generation. This level of information allows homeowners to make informed decisions about their energy use, helping with personal savings and broader sustainability goals.
HEMS can also help homeowners maximise the value of their renewable energy investments. For example, for those with solar panels, a home energy management system can make sure that self-generated electricity is used in the most efficient manner – either consumed directly, stored in batteries for later use or sold back to the grid at the most profitable times.
This level of control and optimisation was simply not possible with earlier generations of smart home technology.
Home Energy Management System in action with Swarm’s Hub:One
After 18 months of development, UK-based green energy firm Swarm launched its first product in July 2024 – the Hub:One.
Designed and built in the North East of England, Hub:One is a jump forward in terms of home energy management technology. It stands out for its versatility and comprehensive approach to energy management.
The Hub:One is designed to work with all major brands of solar inverters, EVs, EV chargers and heat pumps, making it a fantastic solution to seamlessly integrate any domestic renewable energy setup.
Key features of Hub One include:
- The system continuously optimises energy use to maximise cost savings.
- All renewable energy devices are connected and managed through a single system.
- One app provides visibility and control over all connected devices.
- Hub:One uses AI to predict energy usage patterns and optimise accordingly.
- The system can communicate with the national grid so you can get involved with VPPs.
And this last point is important. Hub:One acts as a gateway to Swarm’s Virtual Power Plant, allowing homeowners to participate in a broader energy ecosystem and get paid for it.
How does this work with Swarm’s Virtual Power Plant?
Swarm’s VPP model takes the concept of wholesale power generation and scales it down to the consumer level, targeting homes and businesses across the UK. By integrating artificial intelligence, this model replaces the need for a centralised operation centre, enabling localised decision-making within predefined parameters.
For homeowners, this means the ability to turn their homes into valuable energy resources. When a home produces excess energy, instead of simply feeding it back into the grid at a fixed rate under the Smart Export Guarantee (SEG) scheme, Swarm’s VPP allows this energy to be sold at optimal times to meet peak demands.
This approach not only enhances power supply and consumption efficiency but also provides a new revenue stream for households. Through collective selling, especially during peak grid demands, users can earn significantly more for every kilowatt fed back into the grid compared to standard SEG rates.
The Swarm VPP model is particularly innovative in its use of AI. Each Hub:One device learns from its specific home’s energy patterns, allowing for highly personalised optimisation. At the same time, the network of Hub:One devices can work in concert, responding to broader grid needs in a way that benefits both individual homeowners and the energy system as a whole.
How much can you save with Hub:One and VPPs
The potential financial benefits for UK homeowners are very positive. Early calculations indicate that the average solar panel owner could save £40 per month or £960 a year on their energy bills by using Hub:One.
However, the savings increase for homes with a more comprehensive renewable energy setups.
For example, for households equipped with 10-20 solar panels, 5-10kWh battery capacity, an electric vehicle and charger, and an annual electricity use between 5,700kWh and 7,600kWh, the potential savings range from £960 to £1,286 per year in energy costs.
These savings come from several sources:
- Optimised self-consumption of solar energy
- Intelligent charging and discharging of home batteries
- Strategic use of lower-cost off-peak electricity
- Participation in grid services through the VPP
These savings and earnings, combined with the increased efficiency from participating in Swarm’s VPP, can significantly reduce the payback period for renewable energy installations. This makes the initial investment in solar panels, batteries and other renewable technologies much more attractive for UK homeowners.
It’s worth noting that the exact savings will vary depending on factors such as the specific energy setup, usage patterns and local grid conditions. However, the potential for financial benefits is clear.
Looking ahead with HEMS and VPPs
As the UK continues its journey towards a more sustainable energy future, the role of VPPs and advanced home energy management systems will only grow in prominence. The on-going electrification of homes, coupled with the increasing numbers of
EVs and domestic heat pumps, means we need much smarter coordination of energy generation and consumption at all levels.
We can expect to see further developments in this space, with more sophisticated AI-driven systems emerging to manage the complex nature of home energy use, renewable generation and grid demands. Things can get even more complicated with the integration of blockchain technology, which could facilitate peer-to-peer energy trading. For example, allowing neighbours to buy and sell excess energy directly.
So, if you’ve already got a good home renewable energy set-up, it could be well worth looking at a comprehensive HEMS like Hub:One. Not only does it offer immediate benefits in terms of energy optimisation and cost savings, but it also positions households to take advantage of future developments in the energy market and participate in associated virtual power plant models.
To us, it seems like the future of energy is not just about consumption, but about participation. With systems like Swarm’s Hub:One, every home has the potential to become an active player in the UK’s energy landscape and be better off for it.
