VPP vs microgrid: what's the difference?
Plain difference
A VPP coordinates distributed devices while they remain connected to the grid. A microgrid can operate as a local power system and may island during an outage. The difference matters because VPPs are often about grid services, while microgrids are often about resilience.
Use-case table
| Need | VPP | Microgrid |
|---|---|---|
| Lower bills | Often useful | Sometimes useful |
| Backup during outage | Not guaranteed | Core use case |
| Utility dispatch | Core use case | Possible |
| Local control | Limited | Stronger |
| Complexity | Lower | Higher |
What homeowners should ask
Ask whether the system can power the home during an outage. Ask who controls the battery. Ask whether export payments reduce backup reserve. Ask what happens if internet or utility communication fails.
Common mistake
The common mistake is buying a battery for VPP revenue and assuming it creates a microgrid. It may not. Backup needs safe isolation, load selection, and approved hardware.
Practical recommendation
Choose VPP participation for revenue or grid support. Choose a microgrid design when outage resilience is the main job. Some systems can do both, but the contract must say so.
References
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