ORIGINAL REPORTING: Utilities' failure to plan for DER surge promises missed opportunities, increased costs
Utilities' failure to plan for DER surge promises missed opportunities, increased costs, analysts say; Utilities have good reasons to avoid distribution planning, but now is the time to do it, while DER penetrations are low.
Herman K. Trabish, Oct. 24, 2019 (Utility Dive)
Editor’s note: The expansion of distributed resources is expected to continue and utilities will continue to face the need for new kinds of preparations to deal with it.
The failure of utilities to prepare for the surge of distributed energy resources (DER) expected to come onto their distribution systems will harm both their customers and their own bottom lines, analysts told Utility Dive. But proactively planning for new waves of customer-sited DER can both serve growing customer demand and provide flexibility to address the rising penetrations of variable renewables.
"Most utilities have been able to model the so-far low penetrations of customers' DER on their distribution systems as a change in net load," NREL Research Scientist Kristen Ardani told Utility Dive. "It has not been consequential to bulk power system reliability and ensuring resource adequacy, but that is changing."
Utilities have good reasons to avoid distribution system planning (DSP), Ardani and others said. It is more complex and unpredictable than bulk system integrated resource planning (IRP). And making more customer-owned DER possible may limit revenue-generating utility infrastructure spending and reduce kWh sales.
But now, with DER penetrations still low, "is the time to shift the focus of planning from load growth and new infrastructure to understanding what policies and investments will be needed for the more dynamic system that is coming," Plugged-In Strategies President and former regulatory commission staffer Chris Villarreal told Utility Dive.
"Distribution planning has traditionally been about identifying the upgrades and improvements needed to serve the bulk system," NREL's Ardani said. But the distribution system's "constantly changing generation and load profiles" now requires more attention. Traditionally, distribution system planners, bulk system planners and generation planners were focused on their own points of view, she added.
Legislative and regulatory directives for grid modernization to address customer demand for DER are driving new planning, Ardani said. As a result, "utilities are developing new tools and analyses like hosting capacity analysis (HCA), which provides detailed distribution system maps and data to streamline interconnection." There are two levels of transparency needed in the new planning processes: integrating data and information across different planning groups, and getting that information to stakeholders, Ardani said…” click here for more