Unlocking the Potential of Distributed Energy Resources
Executive Summary
Distributed energy resources (DERs) are creating new opportunities and challenges in the power system. These small-scale energy resources, such as rooftop solar panels and battery storage, are rapidly expanding and transforming how electricity is generated, traded, delivered, and consumed. However, the integration of DERs into existing grids requires careful consideration to ensure reliability and cost-effectiveness.
Electricity Market and Regulation Transformation
To fully realize the potential of DERs, there is a need for a transformation in electricity market and regulatory frameworks. This includes the development of new policies and technologies to manage the increasing share of variable renewable energy sources.
Opportunities and Challenges of Distributed Energy Resources
Introduction
- DERs are small-scale energy resources typically located near points of electricity use.
- They are becoming increasingly widespread and are driving decarbonization and improving grid resilience.
Energy System-Wide Benefits
- DERs offer multiple benefits to consumers, contributing to both decarbonization and improved resilience.
- Small-scale clean technologies are becoming more prevalent behind consumer meters.
Impact on Grid Reliability
- Rapid uptake of DERs poses new challenges for traditional 20th-century grids.
- Proper technologies and incentives can convert DERs into grid assets.
Digitally Enabled Grid Benefit Potential
- Battery storage can provide nearly all grid services.
- Smart water heaters can serve as cost-effective flexibility providers.
- Digital solutions can help optimize the aggregation of diverse small resources.
Key Insights for Electricity Market Design and Regulation
- A call for power system transformation to accommodate the growing share of DERs.
- The importance of integrating digital solutions to manage and optimize the benefits of DERs.
- Examples and case studies highlighting best practices from leading jurisdictions.
This report aims to provide policymakers, regulators, and system operators with practical insights to better understand and leverage the potential of DERs, ensuring a reliable and sustainable electricity system.
