From Consumers to Grid Players: How Distributed Energy Resources Are Redefining Power Systems

Earlier power generation was limited to just a handful of centralized plants. Users were just a regular consumers of electricity. However, thanks to the prevalence of distributed energy resources, or DERs, consumers are now becoming active participants in the energy ecosystem. The DERs comprise of different small-scale technologies that are used in producing, consuming, and managing electricity. In this article, I will talk about how the DER has brought a change in lives of consumers and grid players.

A Power Revolution at Our Doorstep

DERs are now transforming our aging electrical grids. They are more flexible than sit-down rigid power systems. According to the International Energy Agency (IEA), between 2019 and 2021, distributed solar PV reached 167 GW of installed capacity worldwide.

Distributed Energy Resources paved a better method for electricity generation. Now we also see consumers and business producing and sending surplus amount to grid. This type of system gives rise to prosumers. They themselves are the producer and consumer of electricity

The growth of DERs is impressive. Global residential solar capacity has expanded in the last few years. Home battery installations continue to increase steadily. Electric vehicle use is also growing at an accelerated pace. The rise was the most in 2020 of 41%. With the extensive spread of smart thermostats and appliances, there is an estimation of about 600 million heat pumps to be used by 2030.

Benefits of DERs

Distributed Energy Resources offer numerous advantages that are reshaping our energy systems:

Clean Energy Integration: Distributed generation works on the principle of producing renewable power right at the place where it is needed. In this way, there is less energy loss in transmission and fewer emissions of carbon. Grid players are benefitted as solar PV is estimated to increase its capacity fourfold from 134 GW in 2020 to 630 GW in 2030.

Enhanced Grid Resilience: Power outages from extreme weather events or equipment malfunction are very often. They can be prevented by solar panels and batteries in a home. It is an extremely energy that can be utilized during natural disasters and emergencies. Communities with DER installations are much less at risk of widespread blackouts in any emergencies.

Cost Savings: Home owners generating their electricity can reduce their electricity bills. People who are able to sell the excess electricity back to the grid may even generate a good source of income.

Reduced Need for Grid Infrastructure: If appropriately applied, DERs could work to defer or even eliminate costly transmission and distribution upgrades. DERs are also being targeted to help reduce the need for infrastructure investments in the coming years.

Improved Energy Access: In developing areas, DERs shall electrify communities that cannot depend on grid access. They could spur economic activity without having to pay for heavy investments in infrastructure.

Challenges in Implementing DERs

Despite their promise, distributed energy resources face significant hurdles:

Technical Integration: Incorporating large numbers of smaller and variable energy supply into a grid over an existing infrastructure is a difficult task. The intermittent nature of solar and wind adds another layer of complexity. Therefore, grid players have to maintain grid stability in parallel to manage interconnected DERs.

Regulatory Barriers: Earlier electricity distribution frameworks were developed for centralized power system. They do not allow for energy flows bilaterally. Also, generation that is customer-owned is not accepted in some places.

Financial Constraints: DER costs require an upfront investment. It can be considered substantial burden by many households if their income is less. This constraint leads to inequality between different regions and households.

The Role of Smart Technology

Some smart technologies that are transforming distributed energy resources into potential grid assets are as follows:

• Battery Storage as Grid Service Provider: Batteries can provide almost every type of grid service traditionally provided by big centralized power plants. In some cases, residential and commercial battery systems are capable of providing frequency regulation, voltage support, and peak capacity. In some states, the aggregated home batteries are already providing frequency control services with response time quicker than conventional power plants.

• Electric Vehicles as Mobile Battery Systems: EVs are moving battery storage systems with huge potential. If they are equipped with smart charging controls, EVs could shift charging to times when there is abundant renewable generation. Vehicle to Grid (V2G) technology can also allow EVs to transfer power back to homes or the grid when there is a spike in demand.

• Smart Water Heaters as Cost-Effective Flexibility Providers: Smart water heaters are considered among the most inexpensive flexibility resources available. They work by heating water when electricity is cheap and abundant such as during night. Then there is no load on the grid during the day when people bathe.

• Grid-Interactive Efficient Buildings (GEBs): Buildings fitted with smart technologies can interact with the power grid on a dynamic basis. These buildings use an automated system to regulate heating, cooling, and appliance operations. Buildings are pre cooled or pre heated when there is abundant energy. It saves energy during peak hours.

Conclusion

Switching from a one-way power system to a dynamic, multi-directional grid will take time. The coordinated effort of policymakers, utilities, technology providers, and consumers will be needed. Yet, the momentum is building. DERs have made a case in markets across the world. As costs continue to fall and policies get better, more consumers will join the ranks of grid players.

We will witness the future of energy transmission when millions of active participants will build a flexible and intelligent power ecosystem. Contact us to learn how are we are redefining renewable energy systems with IoT.