Central Theme for Energy’s Future: Decentralizing Power Generation

Source: Darrell Proctor | · POWER MAGAZINE · | January 2, 2025

The use of distributed energy resources (DERs) will continue to grow as utilities, businesses, and residential neighborhoods look for ways to balance the power grid and support more reliable and resilient electricity.

1. A rooftop solar array, here on a downtown business, can help control energy costs for a commercial and industrial enterprise—and support a more reliable power supply. Courtesy: Eaton

The use of distributed energy resources (DERs) continues to grow as individuals and businesses look for more control of their energy costs and electricity supply. The use of on-site generation technologies, including solar panels, batteries, small wind turbines, and gas- and diesel-powered generators, is helping power customers mitigate the impacts of grid outages and high prices for electricity.

DERs help local utilities by contributing to a more resilient and sustainable power supply. Customers may have the opportunity to sell excess electricity back to the grid during periods of peak demand; in addition, DERs are the backbone of virtual power plants (VPPs) that are enabling utilities to better manage the power supply, and avoid the cost of building new physical power generation facilities.

The use of decentralized power production means utilities and their customers no longer have to rely on a single generation resource, but rather can utilize a variety of technologies to mitigate the impact of extreme weather and other issues. The use of DERs in microgrid configurations allows for a steady supply of energy in remote locations, an important consideration for military bases and other businesses with a need to operate in areas far from the traditional power grid.

“DER programs allow utilities to shave peak demand, balance supply and demand, and reduce energy losses during transmission and distribution, thus offering a far more stable and efficient grid for everyone. Utilities should not only be involved but further incentivize more adoptions, creating a more resilient, flexible, and economically efficient energy system,” said Shawn McLaughlin, CEO and founder of Emporia, a Colorado-based energy management solutions provider. “At the state level, utility incentive programs have led to growth in DER programs like solar rebate programs and efficiency loans, reduced costs for efficient or renewable technologies, and water conservation incentives. These programs further support technology and encourage more residential and commercial adoptions of smart energy technologies.”