- Press Release
ENECHANGE and Kiwi Power Announce Alliance to Strengthen VPP Business in Japan
ENECHANGE Ltd. (Head Office: Chiyoda-ku, Tokyo; Representative Director & CEO: Yohei Kiguchi; Representative Director & COO: Ippei Arita) has entered into a business alliance with Kiwi Power (Head Office: London, United Kingdom; CEO: Jay Zoellner) through ENECHANGE’s wholly-owned UK subsidiary, SMAP Energy (Head Office: London, United Kingdom; CEO: Yohei Kiguchi). The alliance consists of a reseller agreement between SMAP Energy and Kiwi Power, under which Kiwi Power’s Kiwi Core and Kiwi Fruit products can be exclusively distributed in Japan under the ENECHANGE brand. Kiwi Power provides distributed energy management services, helping to balance supply and demand in power markets and unlocking additional revenue for energy asset owners. ENECHANGE aims to maximize the use of virtual power plants (VPPs) by leveraging its reach and expertise into offering Kiwi Power’s distributed energy resource management system to the Japanese market. Both island nations, Japan and the UK are on a journey towards increased energy market liberalization, and the creation of VPPs through Kiwi’s technology presents a new and exciting opportunity.
To raise the proportion of renewable energy in the energy mix, it will be necessary to build a system that can flexibly adjust power on the grid. The key is to promote both the spread of renewable energy and flexible demand.
Japan’s VPP Market
In Japan, the flexibility market (known as the Replacement Reserve and Replacement Reserve-for FIT) will open in April 2021, and full trading in capacity markets will begin in 2024. These markets are expected to grow to around ¥100 billion*1, as it is key to securing power supply and demand adjustment capacity in line with the expansion of renewable energy. This presents a strong opportunity for VPPs, which operate within these markets. Unlike large fossil fuel and nuclear power plants, VPPs connect the energy generation and storage capabilities of numerous distributed energy assets. Once connected, these assets can be managed and dispatched together as one “virtual” asset, providing more flexibility to the grid and compensation for asset owners. As sustainable resources are forecasted to be used as the supply of power in VPPs, it is important that resources and platforms are connected and can be controlled reliably and flexibly.
|Market size *2||Main trading market *3|
|UK||Approx. 79 billion yen (£565M)||Balancing market results in 2016 (total of FR,Fast Reserve,STOR,BM)|
|Germany||Approx. 85 billion yen (€682.2M)||Balancing market results in 2016 (total of PCR,SCR,TCR)|
*1 The current capacity market size is based on ENECHANGE’s estimate of the market for regulating power sources
*2. UK/Germany: Calculated by ENECHANGE based on the final report of the “Survey on the Balancing Market in Europe and the United States” (July 2018) by OCCTO (calculations based on 1€ = 125 JPY and 1£ = 140 JPY exchange rate)
*3. FR=Frequency Response,BM=Balancing Mechanism,PCR=Primary Control Reserve,SCR=Secondary Control Reserve,TCR=Tertiart Control Reserve
Providing a VPP Platform as the Japanese agent for Kiwi Power
Kiwi Power has developed a distributed energy resource (DER) management platform that has been used in 12 countries for over a decade. As the Japanese agent of Kiwi Power, ENECHANGE will support the entry of energy companies and affiliates into the VPP business through the provision of Kiwi’s DER management platform.
Kiwi Power has experience connecting and managing a wide range of resources. This includes smaller assets such as private diesel generators to large stationary batteries, ranging from 5 kW to 80 MW. More than 1 GW of distributed energy assets have been connected to the company’s software platform, called Kiwi Core. In addition, the total costs for the customer are competitive because of the company’s Kiwi Fruit device, developed in-house, which provides a stable and secure connection to customers’ assets. ENECHANGE is confident that Kiwi Power’s superior asset control technology and demonstrated track record can meet the challenges of the emerging Japanese VPP business.
Background of business tie-up with Kiwi Power
Kiwi Power was selected as a winner of the 2019 edition of Japan Energy Challenge (renamed ENECHANGE Insight Ventures in 2021), the energy sector venture program created and hosted by ENECHANGE since 2018. Since then, ENECHANGE and Kiwi Power have been discussing the possibility of a business alliance, based on analysis of customer needs and trends in the VPP market in Japan. In May 2021, they decided to fully launch their VPP business in Japan via this collaboration.
Comment from Jay Zoellner, CEO, Kiwi Power
“We are beyond thrilled to be working with ENECHANGE as our distribution partner in the Japanese market,” said Jay Zoellner, CEO of Kiwi Power. “As the Japanese market opens up, we expect to see billions of dollars of value and grid efficiency unlocked through our VPP technology. We’re fortunate to be partnering with ENECHANGE’s incredible team and to be a part of this important transition for the power markets in Japan.”
Comment from Yohei Kiguchi, Representative Director and CEO, ENECHANGE Co., Ltd.
“We’ve been eagerly following the global trends in the VPP sector and it is clear that Kiwi Power has a globally competitive solution. Kiwi Power has a strong track record and has been recognized by global leaders like ENGIE, and our alliance presents a fantastic opportunity. The combination of Kiwi Power’s technology and ENECHANGE’s network present a strong foundation for growth in the Japanese market.”
About Kiwi Power Ltd.
Kiwi Power is a leading global energy technology company delivering distributed energy technology and expertise and is backed by ENGIE. The company has over a decade of experience as a market leader, ranking #1 in execution for VPPs by Guidehouse Insights and winning the S&P Global Grid Edge award in 2020. Our simple, yet powerful technology solution, combined with an attractive commercial model and our expertise, gives clients the confidence to participate in the growing flexibility markets and to maximize the value of their distributed energy resources.
Location: 3rd Floor, 3 London Wall Buildings, London, EC2M 5PD, United Kingdom
About ENECHANGE Ltd.
ENECHANGE is an energy technology company that promotes a carbon-free society through digital technology with the mission of CHANGING ENERGY FOR A BETTER WORLD. We offer services based on data utilization in the field of the 4 Ds of Energy: Deregulation, Digitalization, Decarbonization, and Decentralization. Our company’s roots come from an energy data lab at the University of Cambridge, UK, a country where liberalization is well advanced. ENECHANGE has a British subsidiary, SMAP Energy Limited, as well as a global network and analytical technology for energy data.
ENECHANGE Co., Ltd.
Tori Bentkover, Public Relations, Kiwi Power