Deregulation of the electric utility industry, environmental concerns associated with traditional fossil fuel-based power plants, volatility of electric energy costs, Federal and State regulatory support of “green” energy, and rapid technological developments all support the growth of Distributed Energy Resources (DERs) in electric utility systems and ensure an important role for DERs in the smart grid and other aspects of modern utilities. DERs include distributed generation (DG) systems, such as renewables; controllable loads (also known as demand response); and energy storage systems.
Large-scale implementation of DERs can lead to situations in which the distribution/medium-voltage network evolves from a “passive” system (with local/limited automation, monitoring and control) to a global/integrated, self-monitoring, semi-automated system that responds to the various dynamics of the electric grid. This evolution poses a challenge for design, operation and management of the power grid, as the network no longer behaves as it was originally designed to. Consequently, the planning and operation of new systems must be approached somewhat differently, with a greater amount of attention paid to overall distribution system challenges.
Distribution management systems (DMS) and other elements of grid modernization will play a major role in managing the impacts of DERs on the electric distribution system. This management includes mitigating the adverse impacts of DERs on distribution system performance, as well as using DERs to improve (optimize) the electric distribution system.
This report describes the role of aggregators of DERs in providing optimal services to distribution networks, through DER monitoring and control systems—collectively referred to as a Distributed Energy Resource Management System (DERMS)—and microgrids in various configurations.