Ask An Expert: How Distributed Energy Resources Can Help With Grid Congestion

It’s a new year and we’re trying something a little different. Our Ask an Expert series is an opportunity to ask questions, big and small, that come up in the industry. To start us off, we’re speaking with our Director of Product Management Brenda Chew about the value of distributed energy resources (DERs) as part of a holistic approach to load management. Between the elevated demand brought on by global decarbonization and electrification efforts, regulatory requirements,  and increased volatile weather events caused by climate change, load management has become increasingly crucial for utilities to meet demand.

To get started, something a bit easier: how can distributed energy resources (DERs) help utility providers?

Brenda Chew: As DERs are becoming mainstream, we’re seeing adoption continuing to pick up while different capabilities of these technologies continue to expand. Everyone has a water heater in their building and a thermostat in their home. Or walking around your neighborhood, you see new solar plus storage systems on top of houses and electric vehicles on the road. These resources are still underutilized today for the potential value they can provide to the grid.

In aggregate, utilities can leverage these resources to provide capacity benefits, help alleviate supply shortages, and reduce costs for their customers during peak hours of usage. But beyond that, utilities can further leverage the more locational nature of these DERs and help reduce already expensive grid constraint costs. There will also always be the customer opportunity underpinning all of this, where distributed energy resource (DER) programs are a real opportunity for a utility to engage with their customers and improve the traditional relationship and perception of utilities from a customer standpoint, all of which are valuable in fostering customer buy-in to your programs.

What are typical grid restraints a utility may experience?

BC: I think that the constraints and system conditions are going to vary from utility to utility, so it’s hard to say what may be typical! But there are some different use cases you can imagine – here are two examples:

1. Perhaps we have an area that has customers who are quickly adopting electric vehicles in the same region and are risking overloading a transformer. Transportation electrification and electrification efforts in general can lead to a lot more unanticipated load growth along certain parts of the electric grid.
2. You could have a utility that serves a more disparate customer base across more rural and/or rugged terrain, and there is a thermal constraint on the distribution feeder where upgrading would be very costly.

How can DERs align with the distribution structure to alleviate constraints?

BC: Something that I’ve spent a lot of time thinking about in my career, as well as in product discussions at Virtual Peaker, is how can we (the industry and Virtual Peaker) make it as easy as possible to unlock DER value on a more targeted basis. In my opinion, we’re still underutilizing the potential of distributed energy resources (DERs) in supporting distribution grid needs.

How can we much more easily streamline and lower the bar for access for customer DER programs to help serve the distribution grid constraints that the grid planning and operation folks at a utility are managing?  I think the answer is by allowing quick and simple ways to group, structure, and call on distributed energy resources in a way that allows easy alignment with distribution infrastructure, but also allows them to use DERs for other use cases (like the more common peak hour capacity needs that demand response or EV managed charging might address). Technology can play an important role here, and having a flexible structure within a distributed energy resource management system (DERMS) and nimble capabilities I believe will help unlock the opportunity for DERs to be a key tool in solving grid constraints.

Can DERMS address specific bottlenecks in where and how they are deployed?

BC: I see unlocking more of the capabilities for distributed energy resources to support more locational grid needs adds a level of scalability that provides an additional benefit to a utility. For example, in these cases, both the DERMS platform itself as well as how DERs are adopted/deployed can play an important role in specific areas/regions where grid planners anticipate upcoming grid constraints. In fact, leveraging a DERMS and scaling DERs in a region where anticipated grid constraints are can also be seen as a risk mitigating action.

As we’ve learned over the last few years, the future can be hard to predict. We saw with the pandemic that there are some really unpredictable consumer behaviors. People moved to new places, a large shift to remote work happened, and with it, a migration to new places. A utility can extrapolate based on historic data and anticipate load growth in certain areas of their service territory and with that, subsequent grid constraints. But that growth may or may not materialize. If a utility were to leverage a DERMS and DER programs to help target that potential grid constraint, what you end up having is a flexible ability to scale up or scale down your solution to that grid constraint, as opposed to having to lock in paying for a costly grid upgrade for load growth that may never materialize.

Distributed Energy Resources & Grid Congestion Conclusion

In spite of efforts to ease interconnection rules to expedite grid modernization processes, energy insecurity and grid congestion remain a challenge for utilities. Fortunately, distributed energy resources like solar, battery, and smart home devices like thermostats and water heaters have already proven valuable assets in enhancing grid resiliency and defraying high peak demand electricity costs. Although we can forecast potential energy needs, we still can’t quite see the future. Join us next time as we continue our discussions with one of our many experts to navigate the energy transition together.