How Utilities can Benefit from a Distributed Energy Resource Management System
Distributed Generation (DG) installations are growing exponentially, and projections show the United States is expected to hit one million cumulative residential solar PV installations in the next two years, making the 2016 market ten times larger than the 2010 market.

By Alison Patelski and Jeff Smith

DG resources, and in particular rooftop solar, are greatly impacting electric utilities in North America:

  • At this moment, the United States electric grid is currently supporting over 400,000 solar systems, representing more than 10 GW of nameplate capacity (averaging about 25 kilowatts per system).
  • Ontario alone is expected to reach 2,650 MW of solar PV by 2015, and has processed over 10,000 applications to-date through its FIT and microFIT programs.

Grid operators have a tall order: maintaining grid reliability and stability as more DG assets are installed by their customers. Utilities can plan for and manage DG growth by adopting new tools, techniques, and processes. A Distributed Energy Resource Management System (DERMS) is a centralized engine that collects, stores, and reports data from DG assets in the field, providing utilities with the intelligence necessary to achieve success.

United States Distributed Generation Market Context
Distributed Generation (DG) installations are growing exponentially, and projections show the United States is expected to hit one million cumulative residential solar PV installations in the next two years, making the 2016 market ten times larger than the 2010 market. The hardware costs for rooftop solar installations have decreased more than 60% since 2011 and the soft costs associated with rooftop solar are decreasing as well. Many Authorities Having Jurisdiction (AHJ’s) are becoming more familiar with solar installations and are implementing expedited processes to review solar permit applications in a given time frame. Finally, additional financing options are available that expand rooftop solar owners beyond the upper-middle class. However, as the number of DG installations increases, the complexities within the utility increase as well.

Recently, the United States Environmental Protection Agency (USEPA) released a draft rule: the Clean Power Plan, which will have states transition coal-based electricity to cleaner resources between now and 2030. This new ruling is one of the many transformations happening in the utility industry today that have regulators and grid operators bracing for more customer-sited renewable resources. The utility industry is on the verge of the largest transformation in more than a century, and there are a number of drivers that accelerating the change. The pressure to reduce dependence on fossil fuels is forcing utilities to look beyond traditional sources of power to alternative energy sources. Renewables have come into focus as a viable alternative and utilities are seeing an increase in the amount of renewables on the grid.

Further, the Federal Energy Regulatory Commission (FERC) released Order 792 in November 2013. This rule updates small generator interconnection procedures (SGIP) to streamline DG interconnection by reducing time-consuming studies for qualifying systems. The new pro forma rule will allow Fast Track access up to 5 MW, revise the technical screens to 100% of minimum feeder load, and allow system owners to receive a pre-application report within 10 business days.

Distributed Generation Planning and Management Practices
DG systems are gaining in popularity - leading grid operators to account for, plan, and manage their growth. Grid operator ‘accommodation’ of DG can be broken down into 3 elements:
  • Initial enrollment (new)
  • Master systems data (existing and new)
  • Operational intelligence (all resources)
    • What is the impact of DG as adoption goes from 0.1% -->1.0% --> 10% customer adoption e.g. feeders

Grid operators need to consider DG management plans to identify the material impacts to their business operations, including:

  • Current State: Current adoption and near-term projections of distributed energy resources (including electric vehicles and distribution generation technologies)
  • Future State: Impacts modelling
  • Gap Analysis: Mitigating technologies/processes; applicability
  • Roadmap: Multiyear roadmap and business case

How will utilities manage the growth of distributed generation installations in their territories? Technology is one way to prepare and manage the influx of interconnection/net metering requests that come with the increase in DG installations. Implementing a distributed energy resource management system (DERMS) is the first step in successfully managing and capturing the DG system information.
A DERMS is designed to manage the full lifecycle of all distributed energy resources, including distributed generation/solar. A DERMS provides a single repository for all distributed energy resource information as well as a central location for the utility departments to access the required information. A DERMS allows utilities to enable electronic enrollment processing, manage DG asset data to all utility operation and planning systems, and provide utilities with the ability to forecast the impact of customer’s DG systems in real time.

The electronic submission allows utilities to move away from paper-based applications and streamline the application process through the implementation of an application portal made available to the rooftop owners or their contractors – heretofore referred to as “customers.” It is important for utilities to have a centralized repository of all applications with easy access to pull up a customer’s application for review and reference. By moving the application to an electronic submission process, the utility can build in smart features to improve the application process for not only the customer, but the utility as well. The smart features include field-based error checking, auto-fill, and a completeness review. These features allow the customer to only see the fields that pertain to their application and improve the accuracy of applications, while reducing the number of incomplete/inaccurate applications submitted to the utility.

Additionally, applications are tracked throughout the review process with notifications sent to the system owner/contractor to reflect the progression of the application through the review process. By communicating with the customer, the utility increases transparency related to the review process. The increased transparency reduces the call volume associated with asking about the application and where it is in the review process. Customers now have access to this information and can follow the application through the review process individually. Through this added ability, the Interconnect Coordinator can route the application to the necessary departments to complete the review process. This allows all utility parties to work in the same application while completing a review and eliminates emailing or passing a paper application between departments.

In addition to the electronic enrollment, a DERMS helps utilities manage the DG asset data. Today, much of the DG system data is tracked in disparate systems within the different utility functions. A DERMS allows utilities to have a central repository for all data related to DG systems. By having all the information in a central location, the utility resources do not have to access multiple systems to get all the information they need to complete the review process. It can also integrate with existing information technology / operational technology (IT/OT) systems to collect an accurate representation of DG installations. The integration provides the necessary information to complete the technical review for each proposed installation. By housing all the data in a central location, utilities will be able to more accurately provide reports to regulators, stakeholders, and internal departments.

One benefit of a DERMS and having all the data in a central location is the ability to have a holistic view of the distributed generation systems on the grid. The utility has an accurate picture of the feeders nearing capacity and where new installations will likely trip a technical screen and require additional studies. Additionally, the Interstate Renewable Energy Council (IREC) published the IREC Model Interconnection Procedures identifying a utility best practice as publishing a report for system owners or contractors to access prior to submitting an interconnection request. This report includes the available capacity for the requested area as well as the nature of upgrades needed so system owners can plan for modifications as needed and contractors will know the best areas to target for selling additional installations.

Having the information about available capacity not only helps the customers, but the utility as well. By knowing the available capacity of each feeder and the areas where feeders are nearing capacity, the utility can plan for upgrades to the grid. The utility can use the information to plan for capital expense upgrades and build them into their annual budget and minimize the number of studies required for new distributed generation installations.

The third component of a DERMS is forecasting the impact of the DG systems in real time. The utilities can use the collected system information from the interconnection applications to track basic information related to the size and location of the installation. Utilities can request additional information related to the installation that will help obtain more accurate forecasting data. Information such as orientation of the system as well as tilt will provide this information, specifically for rooftop solar installations. If utilities do not have accurate weather data, they can focus on “backcasting.” Backcasting uses historical trends of system production to help the utilities plan for future production.

Utilities can also integrate with a weather source to pull real time weather forecasting for a given area. The DG system data in a DERMS coupled with weather data allows utilities to predict output at a given time. Tracking and anticipating renewable DG, especially rooftop solar, is very helpful for utilities whether it be immediate (load balancing) or near-term (capacity planning) planning. Utilities will understand the impact of the DG systems on the grid at different times of the day and can use the information to assist the procurement team in adjusting power purchasing at different times.

As the number of DG installations grows, utilities will need the ability to scale their current processes to support the increase in applications. By implementing a DERMS, utilities will realize benefits from having all the data in a central repository to understand and manage all DG assets on the grid. Our prediction: the number of DERMS solutions created for, and by, utilities will continue to evolve rapidly in North America.