PG&E Opts for “Radical Collaboration” with Operators of Microgrids and DERs with DERMS

July 31, 2023
No longer is PG&E holding its cards close to its chest, said Schneider Electric's Don Wingate. With a DERMs system, PG&E has opted for transparency and collaboration with community members.

Microgrids and distributed energy resources (DER) are about to become more visible to Pacific Gas and Electric (PG&E) through the utility’s new partnership with Schneider Electric and Microsoft.

The partnership–which aims to deploy a distributed energy resource management system (DERMS)--requires PG&E to start showing its playing cards, said Don Wingate, Schneider’s vice president, microgrid and utility solutions.

During a recent planning meeting with PG&E that focused on working together, Wingate was told that the utility–plagued by wildfires, energy emergencies and outages–always holds its card close to the chest.

But by partnering with Schneider Electric and Microsoft to roll out a new DERMs system, the utility is making an about-face.

PG&E no longer holding cards close to the chest

“They're showing their cards. They're saying, ‘there's no reason to keep secrets. If we're going to be a partner, we have to have total transparency,’” said Wingate.

That wasn’t true 2.5 years ago when Patricia Poppe became CEO of PG&E. At the time, the culture was fairly defensive, rather than proactive, he said. The focus was on building to existing capacity.

But now, about 23% of the electric vehicles (EV) in California are purchased in PG&E territory, which is yielding huge load growth. Meanwhile, heating is being electrified, leading to additional load growth. In fact, PG&E expects demand to increase by two to three times over the next 15 years.

Under these circumstances, PG&E couldn’t simply look back to what it had been doing.

 “PG&E had to take a forward-looking approach and figure out how to have partnerships,” said Wingate.“The culture had to be changed to radical thinking and more radical collaboration.”

PG&E will be one of many utilities presenting key grid projects at T&D World Live

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Using Microsoft Azure to collect and store information

That’s the spirit of PG&E’s new partnership with Schneider Electric and Microsoft under which PG&E will use Microsoft Azure–a cloud-based platform–along with Schneider Electric’s EcoStruxure DERMS system to collect and store information about DERs and microgrids in its territory.

“With these systems, instead of having data processing in a closet, it comes out into the cloud,” said Wingate. 

Schneider Electric software will run in the cloud to gather information about DERs on the PG&E system–rooftop solar, EVs, EV fleets, energy storage and microgrids installed by PG&E customers. With that information, PG&E will be able to operate in a more instantaneous and collaborative fashion.

Right now, PG&E–as well as many utilities across the country–can’t “see” where the DERs are located on their systems, or when the DERs are operating, so it’s not easy to take advantage of the benefits the DERs can provide utilities.

PG&E will ask customers for permission to use their DERs located on its system

With the DERMS in place, PG&E’s customers who own DERs can opt into the DERMS system and work with PG&E to help lower costs for both customers and the utility, providing clean power, demand response and resilience.

For example, if PG&E is facing potential brownouts or blackouts during peak demand periods, or if acquiring power is becoming very expensive, the DERMs application can, with customers’ permission, allow the utility to utilize the solar, microgrids or other DERs owned by customers, then compensate them for using the resources.

“PG&E might say, ‘I'd like to use some of your battery for 20 minutes,’” said Wingate. “Think of it as a demand response program that's more collaborative and having more instantaneous insight into DERs,” he said.

PG&E, with input from California regulators, will establish pricing signals that provide incentives for customers to participate.

This program will differ from traditional demand response programs, said Wingate.

“With demand response, the utility usually says, ‘please please reduce your consumption. And sometimes people will do it and sometimes they won't.”

Focusing on circuits that need the most help

DERMS, on the other hand, will allow PG&E to focus on very specific areas–a circuit, for example.

 “If you knew that there were 10 microgrids on that circuit and 100 homes with solar panels and 50 homes with EVs, you might be able to be more cost-effective and specific with what your needs are,” he said.

By knowing what’s happening on the system in real time, PG&E should be able to reduce the number of brownouts and blackouts, he said.

“The collaboration that we're talking about is not just between Schneider Electric and PG&E and Microsoft. It's about collaboration with the community and the regulators,” said Wingate.

Regulators can participate in this collaboration by listening to utilities and helping them with tariff structures, he noted.

PG&E isn’t the only utility rolling out DERMS systems.

Horizon Energy also is working with DERMS

Last summer, Horizon Power announced plans to launch DERMS technology across its microgrids in Western Australia to ease the integration of customer- and utility-owned DERs.

The regional utility first demonstrated what it calls the microgrid of the future in Onslow, a remote coastal community of about 900 people in Western Australia. Demand for hosting customer solar photovoltaics (PV) had exceeded the limits of what the Onslow microgrid had been designed to handle, and the excess energy combined with the intermittency of the solar PV was creating challenges for the network and its equipment.

Horizon integrated DERMS with its microgrid to manage the community’s growing distributed energy resources. It co-designed the DERMS software with PXiSE Energy Solutions.

More and more utilities are expected to join the radical collaboration revolution enabled by DERMS, said Winslow.

“We’re at an inflection point where DERMS applications are going to become required if we're going to meet the needs of the radical demand increase–two to three times the energy usage in the next fifteen years,” Wingate said.

About the Author

Lisa Cohn | Contributing Editor

I focus on the West Coast and Midwest. Email me at [email protected]

I’ve been writing about energy for more than 20 years, and my stories have appeared in EnergyBiz, SNL Financial, Mother Earth News, Natural Home Magazine, Horizon Air Magazine, Oregon Business, Open Spaces, the Portland Tribune, The Oregonian, Renewable Energy World, Windpower Monthly and other publications. I’m also a former stringer for the Platts/McGraw-Hill energy publications. I began my career covering energy and environment for The Cape Cod Times, where Elisa Wood also was a reporter. I’ve received numerous writing awards from national, regional and local organizations, including Pacific Northwest Writers Association, Willamette Writers, Associated Oregon Industries, and the Voice of Youth Advocates. I first became interested in energy as a student at Wesleyan University, Middletown, Connecticut, where I helped design and build a solar house.

Twitter: @LisaECohn

Linkedin: LisaEllenCohn

Facebook: Energy Efficiency Markets

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