3Q 2022

Achieving Climate Neutrality with Energy Management Solutions

Sustained greenhouse gas (GHG) emissions have caused, and are continuing to cause catastrophic damage to the environment, economy, and human health all over the world. In response, all customer segments are increasing their efforts to achieve climate neutrality in their operations. With more renewable energy capacity coming online and distributed energy resource (DER) installations increasing behind-the-meter, supply side volatility is worsening and a more complicated power flow structure on the grid is forming. Energy management solutions like virtual power plants (VPPs) and distributed energy resource management systems (DERMSs) create an opportunity to firm up renewable generation output and enable a transition entirely away from fossil fuels.

To maintain reliable power grid operations in a climate neutral world, utilities and grid operators will require new technologies, strategies, and solutions. Energy management solutions can make use of both clean supply and demand side resources connected to a territory’s grid. In addition to maximizing the value of these resources, energy management solutions can use them to displace traditional power generation technologies. By optimizing renewable generation output, energy storage resource operation, and flexible load control, energy management solutions can drastically reduce operating costs while simultaneously eliminating emissions.

This Guidehouse Insights report discusses the role that energy management solutions like VPPs, DERMSs, and demand response can play in the transition from fossil fuels. It provides recommendations to key stakeholders to increase the opportunities for, and the effectiveness of energy management solutions as the world seeks to achieve climate neutrality in the coming decades.

Pages 17
Tables | Charts | Figures 3
  • What are energy management solutions?
  • What is driving the need for new energy technologies in grid management?
  • How do energy management solutions function on the power grid?
  • How can energy management solutions support a path to climate neutrality?
  • What role does beneficial electrification play in the energy transition?
  • What can various stakeholders do to drive the adoption of energy management solutions?
  • Regulators and policymakers
  • Utilities
  • Grid operators
  • DER vendors
  • VPP software providers
  • DERMS vendors
  • DER aggregators
  • Commercial, industrial, and institutional energy consumers




Efforts to Reduce Greenhouse Gas Emissions Are Increasing Worldwide

Total Renewable Energy Capacity on the Grid Is Increasing

Distributed Energy Resources Are Creating a More Complex Grid Structure

More End Uses Are Switching to Electricity

New Methods and Technologies Are Required to Maintain a Reliable Net-Zero Emissions Grid

Energy Management Solutions Can Treat Loads as Resources and Make Renewable Generation Dispatchable

 VPPs Can Reduce Emissions and Operating Costs

Stakeholders on Both Sides of the Meter Must Collaborate

System Operators and Regulators Must Create Supportive Regulatory and Market Environments for New Energy Solutions

DER Solution Providers Must Engage More with Utilities and Energy Users

Large Energy Users Must Further Explore Strategies on Their Own to Become Climate Neutral

Case Study: Google 24/7 Carbon-Free Energy by 2030

  • CAISO Net Load Chart (Duck Curve)
  • Conceptual VPP Diagram
  • Value Proposition of DER and Energy Management Programs
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