DERMS Adoption in Australia: Why Horizon Power Decided Now Is Better than Later

The value of distributed energy resource (DER) assets can only be fully realized if they are integrated at customer sites and brought into markets or the grid network in a way that creates shared value. This belief is nearing a consensus, but the journey on how to get to this place remains a topic of intense debate among utilities, other grid operators, consumers, prosumers, and a wide pool of private sector solution providers.

The latest buzzword in the energy industry is DER management system (DERMS). Unlike microgrids, which the US Department of Energy has defined, there is no equivalent definition of a DERMS. In short, however, a DERMS is typically deployed by a utility to manage DER assets to address voltage and other reliability issues at the distribution network level. The full suite of DER management tools that fall under an enterprise DERMS are aimed at a common purpose, supporting a more nimble, sustainable, and customer-centric energy future. Or, what Guidehouse Insights calls the Energy Cloud. As noted in a white paper sponsored by Enbala, there are many myths surrounding what a DERMS can and cannot do.

Leading Vendors See Eye-to-Eye on DERMS Myths

PXiSE Energy Solutions is a DERMS and microgrid controls provider that inked a major agreement with Toshiba. PXiSE Energy Solutions sees eye-to-eye with Enbala on myths surrounding real-time control of DER assets as overkill and challenges the false assumption that the electric utility industry is not yet ready for DERMSs. Case in point is the deployment of a DERMS solution in the remote community of Onslow, Australia, served by a Horizon Power microgrid being upgraded to incorporate new renewable energy assets. Some assets are owned by the utility and some are not as shown in the following figure. The story of how Horizon Power sees DERMS should open the eyes of those that think the technology is only relevant to industrialized western markets (e.g., the US and Europe). This project illuminates DERMSs’ applications for emerging economies in Africa, much of Asia Pacific, Latin America, and the Middle East.

PXiSE DERMS Topology

(Source: PXiSE Energy Solutions)

As noted in a new white paper, Horizon Power is moving forward with a comprehensive DERMS program that would cover its entire service territory. This is a significant new application of DERMS. Why? Horizon Power boasts the largest utility service territory in the world (if California was repeated five times) with the lowest customer per square kilometer ratio of any utility service territory (1 for every 53.5 square kilometers).

The issues Horizon Power faces reflect the needs of utilities worldwide—it is just tackling them sooner. While some utilities may question why they need a DERMS now, the challenges of integrating customer-owned DER assets will affect every regional utility in the world. Facing the first steps of the technology transition now will set utilities up for success as reliance upon DER assets grows.

Early DERMS Adoption Gives Utilities Room for New Customer Offerings

The irony is that a remote microgrid is a perfect place to verify the value of a DERMS. What Horizon Power needed was new technology capable of split-second decisions to keep the self-contained grid in balance. The small-scale amplifies these challenges. The smaller a grid, the more susceptible it is to stability issues due to less inertia. DERMSs allow Horizon Power opportunities to not only operate in a carbon-free mode but also to develop new utility customer offerings for Onslow, Australia, residents. The systems help expand the use of EVs as a grid resource and harness new innovative demand management programs such as demand response. Moving forward with a DERMS now allows a utility to anticipate problems that will likely arise in the future while still capturing the full and embedded value of DER assets today.