Energy Currents
A Blog by Enerdynamics

Electric Utilities Must Prepare Now to Integrate Large Amounts of Distributed Energy Resources

by Bob Shively, Enerdynamics President and Lead Facilitator

In recent years, the energy sector has seen a dramatic shift toward distributed energy resources (DERs) including demand response, rooftop solar, and customer-owned batteries. Soon other technologies like EV-to-grid and thermal storage may join the boom. This surge in customer-owned generation presents both opportunities and challenges for electric utilities. Let's explore how utilities are adapting their systems and processes to integrate these new energy sources safely and efficiently.

The DER boom
The growth of DERs in the U.S. has accelerated significantly in recent years, driven by technological advancements, cost drops, policy incentives, and increasing demand for renewable energy plus resilience against extreme weather events. According to a recent Wood Mackenzie analysis, DER capacity in the U.S. is expected to nearly double between 2022 and 2027. Capacity will grow 3.7 times more over this period than it did in the previous five years. The 262 gigawatts (GW) of new DER and demand flexibility capacity set to be installed from 2023 to 2027 will nearly match the 272 GW of utility-scale resources forecast to be built over the same period. 

Interconnection rules: A crucial framework
To manage this influx of DERs, utilities must review and revise current rules to ensure interconnection processes are transparent and ready for rapid growth. Typical processes include:

1. Hosting Capacity Analysis (HCA): A circuit-by-circuit analysis is performed to determine what level of DERs can be interconnected to each feeder without costly upgrades. Key limiting factors include substation transformer banks, secondary conductors, voltage regulation impacts, and protection coordination.
2. Application categorization: Specific proposed projects are classified based on size and potential grid impact, with rules applied based on the characteristics of a proposed DER.
3. Technical screening: Projects categorized as having limited impacts can be approved quickly. Projects with more significant potential impacts are moved to the detailed study phase. 
4. Detailed study: For projects with significant grid impact, utilities conduct in-depth analyses of potential system impacts and identify necessary grid upgrades and their cost. Interconnection of these projects requires an agreement on cost responsibility and is contingent on completion of the grid upgrades. 

Key technical considerations
When integrating DERs, utilities must address six primary concerns:

1. Thermal capacity: Ensuring power lines and equipment such as transformers can handle potential reverse power flow.
2. Voltage stability: Ensuring that voltage fluctuations caused by intermittent generation will not result in exceeding voltage limits on a circuit.
3. Rapid voltage change: Ensuring voltage swings due to cloud cover or other interruptions can be managed without impacting other customers.
4. Circuit protection schemes: Preventing protection schemes from tripping breakers due to bidirectional power flow and other system conditions caused by DERs.
5. Unintentional islanding: Avoiding power flow onto the grid from DERs during system outages.
6. Lack of operational information: Avoiding being unable to determine how DERs are impacting the system in real-time.

Necessary system upgrades
To accommodate DERs, utilities often must upgrade their infrastructure. Common upgrades include:

1. Equipment upgrades: Replacing equipment such as cables, transformers, and switches with equipment rated for projected levels of two-way flow.
2. Voltage regulation: Upgrading voltage regulation devices such as capacitor banks and tappable transformers to handle voltage fluctuations and rapid voltage change.
3. Protection schemes: Replacing outdated protective devices with modern, electronically controlled equipment.
4. Customer breakers: Requiring installation of direct transfer trip (DTT) systems to prevent unintentional islanding.
5. Metering: Implementing advanced metering and communication systems for real-time monitoring.

The road ahead
As DER adoption continues to accelerate, utilities must change practices to ensure DERs can be connected to the system in a safe, reliable, and timely manner. By embracing these changes and proactively addressing technical challenges, utilities are paving the way for a cleaner, more resilient energy landscape that benefits all stakeholders.

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