Batteries
Needless to say, batteries, including those in EVs, are versatile resources. Batteries deliver up to 13
co-benefits to customers and the grid. Home battery pairing enables consumer to make the most of
the low-cost clean energy provided by rooftop solar. These capabilities make battery storage
indispensable to burgeoning virtual power plant (VPP) projects.
Grid-interactive efficient buildings
Grid-interactive efficient buildings that integrate a range of DERs can optimise building energy
‘prosumption’ and can be valuable assets to the grid. A recent study estimated that around 9,000
public buildings in the US could generate up to USD 70 million per year in value for grid users if
they were upgraded to be grid-interactive.
Virtual Power Plants (VPPs)
VPPs can aggregate DERs scattered across large regions and provide every grid service. Advanced
optimisation algorithms, such as artificial intelligence, enable VPPs to deliver value to DER owners
while maintaining grid reliability and meeting customer preference. The world’s largest VPP project
under development in Australia comprises 50,000 solar and battery systems.
Digitalisation alone is not enough. Every aspect of the power system needs transformation
Even when equipped with digital technologies, DERs can still create challenges for grid operators.
Unless DER owners are incentivised or mandated, they have little reason to consider the impact of
their devices on the grid as a whole. Compensation and regulation can encourage DER owners to
locate and operate their devices in better alignment with grid status in real-time, providing diverse
benefits.
Compensation can help align the interests of DER owners with the needs of the grid, improving both
grid reliability and DER economics. Electricity tariff design can ensure fair remuneration for the
value created by DERs, which can be time- and location-dependent. Regulators can facilitate the
aggregation of small-sized DERs and their participation in the wholesale electricity market. Incentive
schemes can also encourage utilities to procure DERs to replace costly grid upgrades.
Regulation can introduce minimum requirements to help maintain grid reliability. Data collection
rules can improve oversight of DERs without incurring onerous cost burdens to their owners.
Regulation also helps limit the impacts of crises when energy exports into the grid need to be
curtailed, for example. Two different sets of rules typically govern power generators and consumers.
Tailored grid interconnection rules can help facilitate the use of highly controllable batteries for both
generation and consumption.
Furthermore, grid operators need digital management systems to implement compensation schemes
and enforce rules. Advanced metering infrastructure has been one of the first such solutions to be
deployed at scale. Distributed energy resources management systems (DERMS) can be used to
register and manage DERs effectively. Addressing data privacy and cybersecurity also is crucial.
Without interoperability, consumer devices, aggregators and grid operators cannot efficiently
communicate together.