6 Questions to Ask Before Purchasing a DERMS
As the impacts of climate change continue to create new challenges to the energy industry, distributed energy resources (DERs) like solar, batteries, smart thermostats, electric vehicles (EVs), and other IoT, behind-the-meter devices are increasingly adopted by a consumer (prosumer) base eager for change. In specific, DER technologies complicate the grid by adding both demand and a profound shift in peak times of usage, upending the decades (perhaps centuries) long paradigm of how and when energy is most commonly needed. The good news is that through the use of robust distributed energy resources management systems (DERMS), utilities can utilize these otherwise disparate resources as potential energy assets that provide renewable, community-produced energy to help conserve electricity, lower high energy costs, and strengthen grid resilience.
DERMS platforms are software solutions designed to aid in monitoring, controlling, and integrating these renewable resources into the grid – all of which are instrumental to a low-cost, low-carbon grid. Putting these assets to use requires strategy to deploy, whether your utility pursues demand flexibility conservation efforts or DER initiatives powered through community energy assets. Making decisions on how best to select the DERMS that works best for you is an arduous task that requires utility professionals to evaluate the best software platform, but we’re here to help with our six questions that utility program managers can ask before committing to the right DERMS vendor!
Question 1: How does the DERMS integrate with Original Equipment Manufacturers (OEMs)?
Enrolling and managing bring your own device (BYOD) DER programs among multiple DER device types is challenging. Behind-the-meter devices & IoT integrations are the determining factors for the success of demand response programs. Before committing to a DERMS, you’ll want to ensure it easily integrates with OEMs and that the integration passes over the data points needed to monitor and track enrolled devices.
Consider the level of effort your development or IT teams will have to take on every time you decide to add a new device type or brand to your program. Does the DERMS use open standards like OpenADR or a modern open spec API like Gravity Connect that can easily provide the device telemetry and control capabilities required to participate in utility programs? These are questions you’ll need to answer to determine the timeline and scope of your potential program.
Question 2: How scalable are your DERMS of choice? What other capabilities does it have?
There are many aspects to consider when thinking of the scalability of the software. First, let’s discuss what scalability means in this context. In this context, scalability refers to whether or not the software will scale as your program does. For instance, does the DERMS easily integrate with multiple device types so that as your demand response (DR) programs grow you can easily add new devices or additional OEMs of the same device type? You might want to start with a smart thermostat pilot, scale the program, and later you might scale up to include a smart water heater program.
Does the DERMS have additional features that can be added that allow you to focus on other aspects of DR programs, like customer engagement or demand forecasting? Your DERMS of choice should integrate into customer engagement tools that allow you to interact via email and SMS directly with your customers about:
- Energy usage
- Program enrollment and participation
- Program incentives
Remember that in addition to enhancing the customer satisfaction at the heart of the industry, happy customers can lead to higher revenue and other fiscal opportunities.
Question 3: Does the DERMS provide comprehensive real-time data and analytics?
The expression “data is king” accurately describes the virtues of rich analytics features; the more you know, the better you can enhance your efforts. To efficiently execute on demand flexibility programs, comprehensive real-time and historical data is imperative. A comprehensive DERMS will allow you to control costs and the impact of transmission peaks with real-time data and reporting. Some key data points that you should have access to include:
- Customer demand response event opt-outs rates
- Automated meter infrastructure (AMI) data to determine the effectiveness of demand response events
- Event energy savings in kWh
- Maximum reduction of kw
- The average reduction in kW (over the length of the event)
- Maximum rebound in kw
- Individual device-level data (HVACs, hot water heaters, smart thermostats, EVs, batteries) (customer behaviors – can group them and manage them in groupings(
- Total aggregate data of all devices in the DR programs to help determine effectiveness of programs
- Real-time status of devices connected in the program (whether the device is offline or not and participating in a DR event)
Does your DERMS track those data points? Does it have the evaluative tools necessary for you to streamline and enhance your efforts? Don’t forget the importance of information, or, as another way to put it, knowing is half the battle.
Question 4: Is the DERMS easy to implement?
Usability and efficiency aren’t just critical, but pragmatic decision points to consider with any software solution. For example, suppose you find a DERMS that has your required features at an affordable price point. If that DERMS is overcomplicated or counterintuitive, it can incrementally slow down any actions from enrollment to deployment. From start to finish, you might ask yourself the following questions:
- Does the vendor have a client success team ready to guide and assist with the implementation of your program? What does support look like in the long run?
- If you onboard other teams internally, is the software user-friendly?
Make sure the vendor solicits information and guidance from actual utility program managers about how best to create it so that it is easy to implement. You may consider software solutions that have rich utility and device (OEM) partnerships, which can streamline your process.
Question 5: Does the DERMS provide a user-friendly portal for your utility customers?
Customers want to take part in programs that leverage their (existing and new) devices and provide incentives for participation and customer engagement is key to a strong and involved user base. You’ll want to make sure the DERMS platform you choose has the features and functionality to capture customer data and then take advantage of that data.
Within that portal, utility customers should be able to:
- View upcoming demand response events
- Easily opt out of events
- View energy efficiency savings due to demand response events
- Directly message back and forth with
Just as your operation benefits from the ease of use for implementation and program deployment internally, program participants benefit from user-friendliness. A poor user experience (UX) can lead to decreased participation and lower revenue. Make sure your DERMS is set up to streamline these processes as much as possible.
Question 6: What is the licensing model? (SaaS or Cloud Based)
You’re probably wondering why this even matters. Perpetual licensing is quickly becoming a thing of the past as software as a service (SaaS) models have quickly grown to dominate the market. In fact, studies indicate that SaaS models currently account for around 70% of all software companies, and that figure is expected to continue to grow.
Reasons a SaaS licensing model is beneficial for modern utilities include:
- Cost-effectiveness – with a SaaS model, there are significantly lower upfront costs, as well as the ability to spread the payments across a set contract period
- Easy and quick software upgrades – with SaaS software being cloud-based, as your DERMS provider enhances the platform with new features and updates, your software can automatically update and allow for quick
Honestly, that list could go on. SaaS solutions offer an array of benefits to program managers, from ongoing updates to support, streamlining your processes, and helping to save on long-term business costs.
Questions to Ask About Your DERMS Conclusion
The challenges of the utility industry continue to evolve every year, from increasing extreme weather events taxing the grid to electrifications adding complexity to the load curve. Determining the right DERMS to help navigate these new challenges is no small task, but one worth pursuing. Are these questions useful in your investigation? Let us know!