China turns to ‘virtual power plants’ to stabilise electricity supply as heatwaves trigger demand spikes, undercut decarbonisation drive
- Energy management systems, are gaining currency as sweltering heat pushes up electricity demand, undermines carbon-reduction aims
- More than 10 provincial, municipal governments have unveiled their 2021-25 plans which call for a cloud-based power plant management system

More than 10 Chinese provincial and municipal governments, including Beijing and Shanghai, have this year issued their 2021-25 development plans for the energy sector, which called for a cloud-based distributed power-plant management system to aggregate energy capacities and resources in their regions.
The plans are in line with China’s vision for a modern energy management system, which was unveiled in April by the National Development and Reform Commission (NDRC). The state economic planner mentioned carrying out demonstration projects for buildings, data centres, electric-vehicle grids, and individual households, eager to pre-empt a crisis similar to the one in 2021.
“Flexible and distributed energy management can [strengthen] China’s new power system, which will be dominated by renewable energy under the carbon-neutral goals,” said Qi Haishen, president of THE Solar, a Beijing-based new-energy firm. “This will be a solid step for China’s power sector in its market-oriented transition.”
Extreme weather events, like the heatwaves this summer, are expected to become more frequent as climate change accelerates. Analysts said the latest surge in electricity demand – to crank up factory activity and cool temperatures in homes – will put pressure on the power grids.
A virtual power plant is a network of decentralised power-generating units and flexible power storage systems. It integrates several sources such as solar and wind power plants and coordinates them with storage facilities in real time based on changes in supply and demand. This process ensures a stable and ready supply of power at any time and anywhere.

