China launched its first virtual power plant in Shenzhen on Friday in a bid to balance the supply and demand for energy in different areas and time periods.

The power plant is now connected to 14 outputs including distributed energy storage, data centers, charging stations and the subway system with a capacity of 870,000 kilowatts, the equivalent of an installed capacity of a large-sized coal plant. The capacity is planned to increase to 1 million kilowatts by 2025.

A virtual power plant is a power supply management system that integrates various power sources and better distributes electricity in peak and trough hours. China, with its complicated electric grid, can benefit from virtual power plants to better manage its inputs and outputs.

The power plant in Shenzhen has adopted advanced telecom technologies such as 5G and intelligent technology to provide real-time monitoring data that allows immediate adjustments to energy distribution.

In recent years, the country has set up pilot projects to build virtual power factories in Hebei, Shanxi and Shandong to distribute electricity more efficiently.

China's double carbon goals – achieving peak carbon emissions by 2030 and carbon neutrality by 2060 – have propelled the nation to explore various approaches to better utilize the power.

The country also mentioned a push to develop energy storage facilities and virtual power plants in its 14th Five-Year Plan, which was released by the National Development and Reform Commission and National Energy Administration in March.