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Distributed Energy Resources

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Manoj Nirgudkar's picture
Manager Shubham IT Consultants

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  • Oct 28, 2020

This item is part of the Distributed Energy Resources - Fall 2020 SPECIAL ISSUE, click here for more


Distributed energy resource (DER) systems are small-scale power generation or storage technologies (typically in the range of 1 kW to 10,000 kW) used to provide an alternative to or an enhancement of the traditional electric power system. (Source - Wikipedia)

Traditional electric power system

Traditional electrical power system generates electricity in a large capacity at a centralized location.  Transmission and distribution system then carries electricity to the end user.  There are different types of power generation plant mainly:

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  • Thermal
  • Hydro
  • Nuclear
  • Gas
  • Solar
  • Wind

Why DER?

With advancements in the solar system and wind generating units, it is possible to generate electricity at end user location.

An end user of electricity can generate electricity using rooftop solar photovoltaic units or installing wind generating units in his premises.  He can then store this electricity in batteries locally and use it as he requires. 

With this arrangement, he doesn’t have to worry about faults in transmission and distribution lines. 

Challenges / Limitations

Type of plant

The end user of electricity can only consider solar or wind power for DER.  Thermal, Nuclear or Hydro power plants as DER may not be commercially feasible.

Grid connected v/s standalone plant

Energy generated from DER may not be sufficient to address peak demand of the end user.  He then has to take electricity from the grid as well.

When the number of DER installations increases,  end users of electricity will use grid electricity only for peak loads.   This will make grid management (generation, transmission and distribution companies) unhappy as they will not get Return on Investment (ROI) on their capital expenditure.

Alternating current v/s Direct current

Solar generates DC power.  Also the battery stores power in the form of DC.  However grid electricity and all electrical equipment (TV, washing machine, Refrigerator etc..) runs on AC. 

DER would need frequent conversion from / to AC / DC.  This would affect its efficiency.

Repairs and maintenance

DER owner cannot employ experts for repairs and maintenance of his plant.  He has to outsource this activity. 

Local experts and their response time will be a challenge. 

Also, DER owner cannot afford buying and storing required spare parts.

Grid management

If the number of grid-connected DERs increase and if they all start supplying additional electrical power to the grid at the same time, grid management will be a challenge.  If there is not enough demand, the grid will not be able to store this additional power.  Grid will then have to stop centralized power plants forcefully. 

Return on Investment (ROI)

In countries like India, the cost of capital is higher.  Interest rates — on term deposit and loans — are higher compared to other countries.

DER owner in India would earn more money if he opens a term deposit in a government bank instead of investing it into DER.  His investment is almost risk-free.

How to make DER successful?

Electrical equipment working on AC / DC

If we standardize DC voltage and start manufacturing electrical equipments working on both — AC and DC — conversion losses will be reduced, which will increase DER efficiency.

Certificate courses on DER installation, maintenance and repairs

Certificate courses on DER installation, maintenance and repairs will make local experts easily available for DER.

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Thank Manoj for the Post!
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