The Three Kinds of Scalability Your DER Strategy Needs
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- Aug 25, 2019 7:15 pm GMTAug 25, 2019 7:16 pm GMT
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This item is part of the Special Issue - 2019-09 - Distributed Energy Resources, click here for more
Scalability is a crucial topic for any organization that is employing Distributed Energy Resources (DERs) as part of its demand side management strategy. There are four kinds of scalability when it comes to managing DERs, and in this article we discuss all four.
Let’s start with the one aspect of scalability that organizations typically do discuss: scalability in the volume of devices. Given the accelerating adoption and use of DERs such as storage, rooftop solar, and gen sets, it is indeed important to support a growing number of a given type of device. An organization’s DER strategy and DER Management System (DERMS) should be designed to accommodate far more than the current number of devices — allowing capacity that can scale effectively to 2x, 5x, or even 10x the current volume.
This kind of scalability is valuable to discuss, yes, but it’s the simplest one to anticipate and to solve. Some clearly have a more sophisticated approach than others, but at this point in the evolution of our industry, this type of scalability is a given.
Let’s look at the three other types of scalability that are more easily overlooked:
- Scalability in the variety of devices in the network
- Scalability in the number of use cases for those assets
- And scalability in the dispatch and optimization of those devices
- Scalability of the Kind of DER Devices in the Network – Not only is the volume of individual types of DERs (like storage assets) increasing, but the number of types is increasing as well. In the past, demand response and smart grid initiatives could just focus narrowly on one category of devices. That made it okay to just focus on scalability of volume (many thermostats) rather than the more complex issue of scalability of a variety of supported devices (e.g. different types of DERs such as residential storage, CHP units to specify a few examples). But the landscape of DERs is changing dramatically, and organizations need to have a DER strategy and a DERMS platform that can accommodate a growing variety of devices. With variety comes complexity, so achieving scalability in this area means interoperability, open standards, open protocols, flexible software architecture, the ability to add new kinds of devices without stranding older devices, and management tools for orchestrating so many different types of devices. This kind of scalability will mean your DER strategy and DERMS platform is future-proof.
- Scalability of Use Cases – This type of scalability is all about value streams. Early on in a DER strategy, when organizations may just be using one type of device, they are typically thinking about a single value stream. For example, a Demand Response (DR) program that provides pre-determined savings to a residential customer for a limited number of dispatch events. But that is just one use case for DERs and only one value stream. For organizations and customers to truly maximize the value of DERS, financially and otherwise, a utility’s DER strategy needs to be able to support multiple use cases and multiple value streams. Not talking about this kind of scalability early on in a DER strategy can lead to utilities investing in many different point solutions. That lack of flexibility is problematic in any market, but particularly in one as dynamic as the energy market, where technological changes, regulatory shifts and competitive landscape shifts are occurring.
- Scalability of Optimization – The third type of scalability may be the easiest of these three to overlook, in large part because it’s an operational need that often reveals its importance after a portfolio of DERs has become large and an organization’s use of them has become more sophisticated. As the volume and variety of DERs increases, it becomes more and more difficult for an organization to make effective decisions about when and how to use all of those assets in real-time in an optimized way that aligns with the organization’s objectives. This challenge is often hidden early on, when organizations may just be managing one or two types of devices in modest volumes. But the complexity of deciding which device to use, and for how long, and to what degree becomes exponentially harder as more variables and devices are added to the equation.
These three kinds of scalability should be critical discussion topics for your organizations’ DER strategy and DERMS selection process in order to grow and evolve with the way you will be utilizing DERs and delivering value to customers.
Before wrapping up, I will add a “bonus” topic for your organization’s DER discussions and it, too, is on this theme of scalability. For most organizations, this is further down the road, but as DER efforts mature there will likely be a desire to pursue additional efficiencies and value streams by integrating the DERMS with its Distribution Management System (DMS/ADMS). This type of integration between the two platforms enables the utility/energy provider to utilize DER assets to better deliver on grid services including alleviating network congestion, shedding excess load, managing system peaks, and more. This integration helps bring the control room to closer to the end customer and aligns internal teams in a way that enables scalability.