Virtual Power Plants: A Review of Cyber-Physical Infrastructures, Hierarchical Operation, and Coupled Market Participation

With the availability of a large amount of renewable energy, the need for flexibility in power grid operation is much higher than that of the conventional power grid, and virtual power plants (VPPs) have become an important key structure. This paper reviews the developments of VPPs in key technologies, scheduling and market design. In the case of infrastructure, cloud-edge computing and distributed communication are used to exchange data between various devices. These techniques underpin rapid sensing, low-order modeling and resource pooling. To schedule and control, multi-timescale mechanisms soak up generation and load variations. Moreover, grid-forming (GFM) control and digital twins provide local voltage and frequency control, enhancing dynamic grid stability. VPPs have in the market dimension incorporated combined trading in electricity, carbon and green certificate markets. Effective entry into the market presupposes open profit-sharing systems among the participants. Immediate transformation of environmental qualities into revenue supports long-term business. The future digital technologies will transform VPPs out of simple resource pooling to multi-market revenue generation.