Affordable, reliable electricity through distributed energy resources

The rise of distributed renewable energy is a key factor in creating a more decentralized and sustainable electricity market. To facilitate this change, electricity companies are reimagining how they orchestrate the flow of power on the grid.

In September 2020, the Federal Energy Regulatory Commission (FERC) approved Order 2222, which allows distributed energy resources (DERs) to compete alongside traditional resources in wholesale electricity markets.

DERs are small-scale energy sources that are spread throughout the country but connected to the electrical grid. A residence can become a DER by installing solar panels, electric vehicles, smart thermostats, or fuel cells. Commercial and industrial enterprises have even more options, including small hydropower, municipal solid waste incineration, and biomass cofiring.

To facilitate this participation, utilities companies will need to purchase energy generated by end-point customers, including small business owners with renewable energy sources on their properties.

This is part of a seismic shift in the electricity sector, which is poised to undergo more change in the next 5-10 years than it had in the last 75 years combined. According to Wood Mackenzie, between 2022 and 2027, the US DER market is expected to double in capacity.

A major electricity and gas company is working with Capgemini to get ahead of these changes and reimagine how it orchestrates power from many different sources. With millions of customers, the industry-leading investor-owned utility needs to incorporate this consumer-generated power into its larger network, while ensuring the same level of reliability the public has always known.

Distributed energy challenges

The previous system wasn’t set up for a high level of energy prosumers, who both produce and consume. The existing infrastructure operates under the assumption that utilities provide the public with energy – not that it will flow the other way.

This presents new challenges. For example, if a utility lineman needs to fix wires on a feeder line, he or she needs to know that the line isn’t dangerously energized. It used to be enough to check that electricity wasn’t flowing from the utility to the consumer. Not anymore.

The rapid growth of renewable energy has caused a logjam in interconnection queues. Too much solar energy travelling to the grid can result in dangerous conditions, such as damaging, high voltage levels on feeder lines or disruptions to power quality and system reliability.

Electric vehicle (EV) charging stations pose another issue. According to the U.S. Department of Energy, a typical level 2 charging station has a power output from 2.9 to 19.2 kilowatts (kW). Although relatively rare, if the utility is unaware, an EV owner could suck so much power from the grid that it causes a power outage.

To successfully incorporate distributed energy, the utility company needs a way to stabilize the grid, transform its infrastructure design, guarantee power quality, adhere to regulatory and market demands, and forecast future events.

The promise of DERMS software

The energy company would need to implement distributed energy resources management systems (DERMS), which were developed to work through these types of problems.

An effective DERMS platform – which can cover wind, solar, stationary batteries, and electric vehicles – can help utilities develop roadmaps and implement strategies for achieving the necessary changes for this transition.

Comprehensive DERMS software accelerates the management of devices for distributed energy resources. It’s easier to register and configure new assets, as well as exchange data between them. It enables control signals to be sent to inverters and other edge devices to provide voltage support, regulate frequencies, and optimize power flows.

Greater visibility of these new energy resources enables better analysis (e.g., monitoring, forecasting, aggregation, measurement, verification, planning) and control (e.g., scheduling/dispatch, optimization, curtailment, demand response).

DERMS software makes it easier to manage energy, capacity, constraints, power quality, microgrids, and voltage levels. This level of monitoring, forecasting, and control can help customers get more value from supporting the grid as well – enabling participation in local and regional energy markets. In addition to smarter bidding and settlement decisions, companies can better engage in transactive energy systems that allow prosumers to buy and sell surplus energy.

Integrating DERMS throughout entire network

Unfortunately, incorporating a DERMS product throughout an electricity company’s entire network is a massive undertaking. To maximize its impact, the software needs to be embedded within a company’s existing advanced distribution management system (ADMS), supervisory control and data acquisition (SCADA) system, grid control system, planning tools, and other enterprise systems.

The biggest challenge facing most utilities is not in the technology integration, but in the business process and operational changes that come with the mind-shift of operating a more dynamic grid.

As a business and technology transformation partner, Capgemini built a technical roadmap and created customized DERMS requirements, providing a custom-fit plan to enable DERs to become part of the company’s power generation and distribution network. Additionally, Capgemini created strategies for how the company can enhance its architecture, communications, and data to capitalize on DERMS.

“This is a new technology that many utilities are looking at but haven’t rolled out. We are guiding our customers to getting the most value by leveraging industry best practices, so they’re able to reach their future state and have more affordable, clean, and reliable energy,” said Kyle Haas, Senior Manager in Energy Transition at Capgemini.

Capgemini is helping the company integrate DERMS software into its business processes, data management, systems integrations, and communication protocols that send signals to other assets (e.g., electric vehicles, inverters, battery storage systems). Capgemini is coordinating a network of virtual power plants (VPPs) so that the company can rely on the connected aggregation of DER technologies the same way it would use a traditional power plant but with higher degrees of fluidity and agility.

Through project management, business analytics, change management, system integration, data strategy, and testing, Capgemini is ensuring the company can reliably do three things:

1. Monitor what’s happening on the grid
2. Forecast what will happen on the grid
3. Control what’s happening on the grid

Business outcomes

Implementing DERMS software throughout one’s entire enterprise to better manage various resources contributes to the industry’s overall shift toward sustainable energy and business operations. But it also comes with a slew of business benefits.

As a result of this engagement, the company will be able to offer customers greater incentives for integrating clean and renewable energy, reduce how long it takes to interconnect clean energy, lower overall costs for all customers, and improve reliability.