ORIGINAL REPORTING: Getting Aggregated DER Into Wholesale Power Markets

Hiding in plain sight: Aggregated DERs in wholesale power markets; Distributed resources can't yet compete like traditional generators in US power markets, but demand response products allow them a foot in the door

Herman K. Trabish, July 24, 2017 (Utility Dive)

Editor’s note: This continues to be the frontier of the fight to introduce distributed resources into grid systems.

Aggregated distributed energy resources (DER) are beginning to compete in wholesale markets, but they just aren’t always recognized as such. Two California energy storage providers successfully bid aggregations of automated load reductions into the California wholesale market multiple times during a June heat wave this year, though the California Independent System Operator (CAISO) denies having DER aggregations bid into its market. That is because DER include traditional demand response, energy efficiency, behind-the-meter (BTM) storage, and distributed generation like rooftop solar. The market’s proxy demand response (PDR) product is for demand response and there is another product for DER providers (DERP).

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Leading DER aggregators Stem and AMS are participating in the wholesale market through the PDR product for demand response resources. Demand response is a path to the wholesale market for DER like storage that do not inject power into the grid. The other path is for aggregators of distributed resources to use the DERP tariff but that introduces the more complicated issue of power delivered back into the grid. That requires resolving communications and operational issues. New work to resolve the communications and operational issues could provide a way forward, but in the meantime the resources are getting a foot in the door through the well-established role of demand response providers… click here for more

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