The report “Reimagining the Electricity Sector in Island Nations with Virtual Power Plants” by RMI summarises that Caribbean countries are universally renowned for their turquoise waters, pristine environment, and vibrant local culture. However, a common plight lurks in the background of most islands: a deep dependence on expensive, polluting fossil fuels for electricity generation. This reliance contributes to the unique vulnerability of island nations to volatile global fuel prices that can cripple local economies by driving up electricity prices. Furthermore, the aging and fragile grid infrastructure in many Caribbean countries leads to numerous electricity outages each year.
Most critically, the increasing threat of climate change and its associated extreme weather events are omnipresent across the region. Hurricanes pose a consistent risk to the infrastructure and livelihoods in island nations, as they are capable of devastating entire power systems and leaving communities without power for months. Yet, amid these challenges, a powerful solution is emerging in the form of distributed virtual power plants (VPPs). These innovative systems provide an opportunity to fundamentally transform Caribbean energy systems, empowering communities to take control of their energy future by shifting the power sector from a centralized system to a distributed system. This report delves into the transformative potential of VPPs in this unique context, zooming in on a detailed case study from the US Virgin Islands (USVI) to illustrate the tangible benefits and practical strategies for successful VPP implementation in the broader Caribbean context.
This report spotlights how VPPs, by aggregating distributed energy resources like rooftop solar panels and battery energy storage systems (BESS), can unlock a future where Caribbean nations will have greater energy resilience, lower electricity costs, a more flexible power supply, and a reduced reliance on volatile fossil fuel prices. In parallel, VPPs can accelerate the transition to cleaner, renewable energy sources, reducing greenhouse gas emissions and contributing to the global fight against climate change.
Access the report here
