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DERMS Benefit Utility Customers

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Behind-the-meter distributed energy resources (DERs) are becoming more prevalent. According to POWER, “In the U.S., there are now about 15 million smart thermostats, 2 million solar installations, and 1.5 million electric vehicles (EVs) on the road.” This increase is changing the flow of electric power from a one-way process (from utility to customer) to a two-way or even multi-way process as customers send power back to the utility or to other customers. DERs can help grid operators build a more reliable, flexible distribution network.

Distributed energy resource management systems (DERMS) are the applications that control these resources and are beneficial to utilities as well as their customers. They bring together a wide range of information that is processed by sophisticated algorithms and can be used on a utility or microgrid scale. Using a DERMS system to manage a collection of DERs is akin to creating a virtual power plant (VPP) that can be controlled for reliability and cost-efficiency. Hanna Grene, writing for Energy Central, states, “DERMS…are the key to unlocking community renewable energy potential.”

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Real-Life Examples

As one example of that potential, Siemens collaborated on a project with Commonwealth Edison that included two microgrids that “work together to exchange energy based on hourly pricing bids,” according to Microgrid Knowledge. One of them uses energy during normal business hours and the other in the morning and evening, outside of work hours. As the grid becomes less concentrated and more distributed, utilities will increasingly rely on DERMS to create this type of reliable operation for customers in neighboring communities.

Additionally, Wood Mackenzie observes, “During the summer of 2020, operators in various cities utilized DERs frequently to balance the grid during heatwaves.” For instance, “California’s utilities used all available demand-side resources throughout the August 14th and 15th energy shortages, orchestrating these through multiple DERMS systems to address local constraints and achieve a system-wide peak reduction.”

An Evolving Partnership

Utility customers that contribute energy to the grid are called prosumers (those who both produce and consume electric power). Many choose to participate in this process because they want to have greater control over where their electric power comes from and be part of the move away from fossil fuels. Successful DERMS deployments can result in an increase in renewables capacity. According to Grene, “DERMS solutions are being utilized right now, and have far-reaching potential today to accelerate zero-carbon energy ambitions.”

The Future of DERMS

Utilities will need to continue and expand their use of DERMS to adapt to the new realities of grid management. As the global energy transition to more renewable resources continues, DERMS will be even more necessary to manage both large and small collections of DERs.  

Utilities thinking about moving to a DERMS system should use an “incremental and evolving approach,” according to Michael Goldman at Eversource, as quoted by Guidehouse. Goldman further suggests that utilities can use DERMS at any point on the grid modernization journey, that it isn’t an “all or nothing value proposition.”

Is your utility using DERMS? If so, how? Please share in the comments.


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