Virtual Power Plant participation a hand-in-glove approach for Echuca Regional Health

By Stuart Darragh, Enel X with Mark Hooper, Echuca Regional Health

Echuca Regional Health is widely recognised throughout the region for its holistic and progressive approach to energy management and sustainability, with a proven innovation track record. The hospital is using a new approach to its backup generator testing with Virtual Power Plant (VPP) participation, where it tests its redundancy systems under true emergency conditions, and earns new revenue for supporting the power grid.

Echuca Regional Health features one of the largest solar thermal arrays in Australia, providing not only heating but also absorption cooling to the hospital’s high efficiency HVAC system, 1.2MW of thermal energy storage which is utilised for peak demand management, and a new 500kW solar photovoltaic array that is currently underway. In addition, the hospital has been utilising its backup generators to participate in a Virtual Power Plant (VPP) – a collection of distributed energy assets including backup generators, batteries, and flexible loads that work together to provide additional dispatchable capacity to the grid – since 2017.

Mark Hooper, Executive Project Manager at Echuca Regional Health said VPP participation is a natural fit for the hospital, helping it to enhance site resilience in the face of a weakening grid, and earn a significant new revenue stream which can be reinvested into backup power infrastructure to further enhance system reliability.

PROTECTION FROM UNPLANNED GRID DISRUPTIONS The rapid uptake of renewable energy and retirement of coal fired power plants is impacting grid reliability. Now more than ever, the grid needs additional flexible capacity from alternate sources such as VPPs to help stabilise the grid, reduce power prices and prevent broader power outages. For hospitals, VPP participation provides a unique benefit of advanced notification of potential grid disruptions.

Hooper said, “We expect the grid to be reliable and clearly it’s not. We need to ensure our facility is available for its core purpose of providing primary healthcare 24-7-365. With participation we get advanced warning of instability on the grid, which is an advantage because it means we can prepare for a grid event and don’t have to experience a break in power if an outage occurs.”

“We view VPP participation as another way of keeping our patients safe, because there’s not going to be an

interruption to power if we know that there’s a response request coming. It allows us to fire up our generator and get off the grid.”

“We have full site generator backup for the hospital and can synchronise with the grid to take ourselves offline. This means we have a seamless transition where the site doesn’t experience unscheduled interruptions. The fact that joining the VPP allows us to also get paid to respond to those events, gives us a win-win scenario for our facility,” he said.

ACHIEVING A NEW STANDARD OF EMERGENCY PREPARATION By participating in a VPP, Echuca Regional Health is able to regularly test its backup power capabilities at times and in conditions when grid emergencies are most likely to occur, providing the truest test of emergency preparedness and resilience to grid disruptions.

“A benefit is that you run your generators during a time where you’re likely running a hefty load anyway. But, the key is, you’re being asked to run your generator when the grid still has power. It’s an excellent tool for testing and ironing out any assumptions that are made around that reliability at a time where you wouldn’t normally run your generator,” said Hooper.

“The reality is that if the grid fails, it’s probably going to be on a hot summer day right when you don’t want it to. VPP participation gives us the strength of conviction to know on a hot day where we’re running a high load, that our generators can do the job.”

“There have been events this year where through this program we’ve found some issues we didn’t know existed, and the consequence has been far less than had it occurred at a time when we’d lost power. So, ironing out those problems means that when you don’t have power and you

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need to run your generator sets, you know the resilience is there, because you’ve got all those issues sorted.”

“We’re required to run our generators on load anyway, so if we’re doing it already as part of VPP participation, then we can then defer our weekly test, because we’ve already proven that we’ve met the requirements of the Australian standards to test them on load. Another benefit to us is that we also get a payment,” Hooper added.

PROTECTING SENSITIVE EQUIPMENT VPPs respond quickly to deviations in the grid’s frequency when a large power station or transmission network suddenly fail, to prevent cascading grid failures. Echuca Regional Health participate in this program, which also helps the hospital to protect its sensitive equipment.

“When there’s a frequency event, the VPP sends a signal which automatically switches the site straight to our generator. We have a lot of electronic equipment that’s sensitive to things like voltage spikes and frequency deviations. If the grid doesn’t meet the parameters it’s supposed to, then we trip off. This helps us because we don’t have groups of interruptions that destroy our sensitive electronic equipment, by short sharp interruptions to power. The hospital was already doing something similar, so it made sense to join this program and get paid for it,” Hooper said.

A NEW REVENUE STREAM TO FURTHER ENHANCE RELIABILITY Hooper said that VPP participation became a hand-in-glove approach for the hospital, where they could be paid for something they were already doing, which could be reinvested into ensuring they have best-in-class redundancy systems. “Our business model is based on continual improvement, and the one element that we always run short of is cash. We generate revenue, and engineering departments are not generally revenue generators. It’s nice to get revenue out of assets we already have in use. Participation allows us to meet all elements of continuous improvement, and generate cash, in a really nicely rounded program,” Hooper said.

The hospital is now looking to further increase its demand response capacity by seeking approval from its network service provider to export the site’s excess generation capacity to the grid during VPP events.

“We’re currently working on the grid export program which will be a real benefit for us. Exporting our generation capacity to the grid will create an income stream to support those assets. We’re driven towards it because we have certain things we’re mandated to do with running our generators – so if we’re doing that anyway, and can be paid for it, we’ll certainly look at it as an opportunity,” Hooper said.

VPPS ARE A WIN-WIN FOR HOSPITALS AND OUR TRANSFORMING GRID Echuca Regional Health is providing what the Australian Energy Market Operator (AEMO) has stated is

an urgent need for new forms of capacity on the power grid. VPPs are an obvious and cost-effective solution to this problem, and using existing assets means they can be built quickly, providing for a more efficient use of resources and avoiding the need to build expensive new gas peaking power plants.

Hooper said, “We’re a small user, the VPP is about a lot of one percenters coming together to help out. I’ve been encouraging my colleagues to participate because most of our sites have generators and have to test them anyway, so we might as well run them and get paid for it.”

“The benefit adds to other factors around resilience and knowing your systems work, and you can use the income to improve your systems and other physical elements to ensure you’ve got a reliable generation set.”

“I know some have used their income to increase the size of their fuel supply. Others have used it to install automatic switching or upgrade their PLCs. It’s a win-win because the reliable capacity that we can provide to the grid is improved by putting the money back into improving the reliability of our own backup systems,” Hooper said.

ACHIEVE A NEW STANDARD OF EMERGENCY PREPARATION BY PARTICIPATING IN A VIRTUAL POWER PLANT HOSPITALS ARE ELEVATING THEIR BACKUP POWER TESTING PRACTICES, AND GETTING PAID FOR IT

The electricity grid is not as reliable as it once was, with the transition to renewable power posing new risks to both reliability and the cost of power. The grid is operating with greater uncertainty, variability and a tighter supply-demand balance. This is driven by increased renewable generation, an aging thermal generation fleet, and unexpected retirement of capacity which is increasing the risk of forced outages (AEMO).

Now more than ever, there is a stronger need for hospitals to ensure they have working redundancy measures in place and the confidence they can continue to support patients in the event of a grid trip or failure. Hospitals across Australia are raising their standard of emergency preparation by using an innovative new approach to testing their backup power infrastructure – participating in a Virtual Power Plant (VPP).

A VPP is a collection of distributed energy assets (backup generators, batteries, flexible loads) that work together to provide additional dispatchable capacity to the grid. They are called on when large power stations suddenly fail, when demand is extremely high relative to supply, or when climatic events threaten grid stability.

Participating in a VPP provides a compelling new way for hospitals to enhance their emergency preparedness by testing backup power systems under conditions which simulate true emergency situations. This achieves a new benchmark for best practice testing standards.

Hospitals typically participate by switching to backup generation when required, which can be done safely and without interrupting hospital services. By temporarily reducing demand during critical grid events, hospitals can earn a significant new revenue stream. This can be reinvested into backup power infrastructure upgrades, further enhancing system reliability. Where hospitals require an infrastructure upgrade to achieve uninterrupted load transfer, in many cases this new revenue stream will quickly pay off the investment, which can be externally financed.

ROUTINE TESTING PRACTICES HAVE SHORTFALLS Common testing practices often fail to fully simulate the response required during a grid power failure.

While load bank testing can exercise the generator under load, it doesn’t test the full load transfer sequence using automatic transfer switches and ancillary circuit breakers, and loads are not representative of actual hospital operations.

Another practice, black start testing, tests all system components, however it’s not often done under true emergency conditions such as during a hot summer afternoon when an outage is most likely to occur. This approach doesn’t account for the effects of elevated ambient temperatures, increased building loads, and generator de-rating on system performance.

By participating in our VPP, hospitals can thoroughly test their backup power systems whilst having the safety net of grid power to switch back to should any potential issues be identified.

Ken Herman, Engineering Services Manager at Swan Hill District Health, said, “During testing we discovered that one of our generator circuit breakers operated intermittently and wouldn’t always close. This meant that when both of our backup generators were required to supply hospital demand, the hospital’s supply redundancy could have been compromised if the breaker didn’t close. Once the fault was identified, the ‘sticky’ breaker was replaced.”

ELEVATING YOUR BACKUP POWER TESTING PRACTICES Only VPP participation provides the truest test of emergency preparedness by calling upon your backup generation infrastructure to support actual hospital loads, testing the full load transfer sequence, and often in conditions when grid emergencies are most likely to occur, all the while still having grid power available to maintain supply redundancy.

All system components will be tested thoroughly – from your generator fuel, air, battery and cooling systems to programmable logic controllers, automated transfer switches, ancillary circuit breakers, monitoring and alarm systems. More frequent full-load testing will optimise generator performance and enhance life expectancy.

VPP participation provides advanced notification of possible grid events, enabling hospitals to proactively switch to backup power in anticipation of a grid outage. This allows switching in a controlled environment with mains power still available, reducing the chance of an unplanned disruption.

In the event of a real emergency, you’ll have much greater confidence that your backup power systems will reliably power your facility as expected.

Responding to a critical grid event can also meet routine test requirements where they overlap – meaning a site can effectively be paid to test its backup power systems.

Mark Hooper, Executive Project Manager at Echuca Regional Health, said “As we’re running our generators on load [in VPP participation], we can defer our weekly test for another week, because we’ve proven that we’ve met the required standard to test them on load.”

PROTECT YOUR EQUIPMENT FROM POWER QUALITY DISTURBANCES Our VPP automatically responds to deviations in grid electrical frequency, to avoid any cascading failures on the power grid. Many hospitals already have systems in place to ensure frequency deviations don’t negatively impact sensitive electronics and critical equipment.

“We have a lot of electronic equipment that’s sensitive to things like voltage spikes and frequency deviations. We set parameters on our incoming equipment, so that if the grid’s frequency deviates, we switch to our generator. VPP participation became a hand in glove approach for us, it meant we were able to get paid for doing the same thing we already were,” Hooper said.

JOIN A VPP IN TIME FOR NEXT SUMMER As the next critical summer period fast approaches, grid reliability issues and the threat posed to healthcare operational resilience will continue. Participating in a VPP will enable your organisation to achieve a new standard of emergency preparation, whilst accessing a new revenue stream.

A small to medium size hospital with 50 to 100 beds can earn on average $20,000 to $50,000 per annum, whereas larger hospitals with 200 to 500 beds can earn revenue in the order of $150,000 to $250,000 per year.

At Enel X, we operate the largest VPP in Australia (Bloomberg New Energy Finance), and have been aggregating hospitals’ energy load to support the grid since 2009. We’ve had a number of learnings that help our participating hospitals enhance their operational resilience year-round.

We understand each hospital has unique operations and infrastructure needs. To upgrade your testing practices and emergency preparedness before the start of the upcoming summer – the time where outages are most likely, and where you can earn the most revenue – it’s important to get started immediately to allow enough time to integrate your site into our VPP.

To learn more about this opportunity, get in touch with our healthcare consultant Stuart Darragh stuart.darragh@enel.com, or download our guide which explains our VPP technical solution.