Ever heard of the term, “do not put all your eggs in one basket”? Well, it means do not risk everything on the success of one venture. And in energy tech, using distributed energy resources follows the same idea.
In energy consumption, using distributed energy resources (DERs) helps businesses cut energy costs, improve energy reliability, and achieve sustainability goals.
Distributed energy sources should include a perfect mix of small to medium-scale capacities or power plants that can support production and productivity efforts.
What Are Distributed Energy Resources?
Distributed energy resources are small-scale power generation systems typically situated close to where the electricity is consumed.
Distributed energy resources (DERs) are small, modular generation and storage technologies designed to deliver electricity or capacity directly where it’s needed. Typically producing under 10 megawatts (MW) of power, DER systems can be customized to fit specific energy requirements and are often installed on-site.
Why A Distributed Energy System Is Important
The benefits of distributed energy resources are enormous. As energy continues to evolve and take a different shape all around the world, corporate entities, industries, or individuals may begin to approach energy use and energy management in a different light.
Present-day technologies and advancements require a lot of energy, and traditional grids can no longer be relied on, coupled with global warming and the increased need to reduce carbon emissions.
Distributed energy systems (DER systems) can be used in several ways. DER systems can help manage energy bills and ensure reliable power by augmenting current energy services. DER systems can also aid a facility’s independent operation from the electric power grid, whether by choice or out of necessity. Some DER systems can even lower carbon emissions and help improve fuel efficiency on-site.
How to Choose The Right Distributed Energy System
Let’s talk about seven recommended steps that can help you choose the right DER system for you.
Step 1. Analyze Your Needs
Your specific needs are very crucial to the DER system mix that you adopt. Choose a DER system that suits your needs and provides solutions to your problem. There are a number of problems that facility managers or executives might be faced with, these include:
The ESG or Climate Problem
Suppose you are a climate-conscious company or an ESG executive looking to lower the energy consumption of your company or its carbon emissions and footprint. It would be helpful to install a DER system that has low to zero emissions.
Use DER systems that are beneficial for the environment, like wind turbines, photovoltaic or solar panels, fuel cells, or CHP systems. Having a mix of this, or having a power generation system such as this in your mix, will help drive positive environmental impacts.
However, there are unique cons to note. Installing and maintaining DER systems, especially renewable energy ones like wind turbines, solar panels, or fuel cells, requires high upfront costs and large spaces for installation. Their installations can also be intermittent or weather-dependent, which means that they can not be totally reliable. Integrating these systems into existing infrastructure can also be complex, and it requires technical expertise and regulatory approvals, which can take long stretches of weeks or months.
The Power Quality Problem
If the power provided to your facility by your energy supplier is not constant or distorted, or “dirty,” and constantly causes problems for your facility’s equipment, then a DER system that resolves that problem needs to be installed. Frequent power outages can be addressed with an uninterruptible power supply system or a distributed storage device like a lithium battery. This way, you can protect your delicate equipment from the damage that constant power surges and outages can cause.
A downside, however, is that implementing DER systems or backup storage solutions like lithium-ion batteries can be cost-intensive, both in initial investment and ongoing maintenance. Batteries also have limited lifespans and may require periodic replacement.
Another downside to note is that integrating these systems with existing infrastructure can be technically complex, and improper setup or sizing could lead to inefficiencies or even worsen power quality issues instead of resolving them.
The “Peak Billing” Problem
If your power supplier or electricity distributor bills you a monthly fee based on the highest peak usage rate, even if it was just for a few hours, then you can try peak shaving. Peak shaving is the practice of lowering or shifting electricity consumption from the electric grid during hours or periods of high energy demand to systems that have lower electricity costs.
You can install a power-generating system to the mix to provide power during times of peak energy usage, to help lower monthly utility bills.
A likely disadvantage of this solution is that implementing peak shaving requires significant capital investment, and it still needs storage systems to work efficiently. These systems can also be underutilized when there are no high demands for energy, leading to inefficient use of resources.
Also, managing and optimizing when and how to draw or store power can be quite complicated, and it requires advanced monitoring systems ( like Pai Enterprise) and technical expertise to ensure that cost savings actually outweigh setup and maintenance costs.
The Utility Energy Need vs. the Facility Energy Need Problem
Your facility needs electricity to power machinery, but it also has other energy needs, like HVAC systems to cool off machinery or other similar equipment, as well as lights and other equipment like dishwashers, dryers, TVs, etc.
You can install DER systems to generate power and use the waste heat for other purposes that would have required heat to generate electricity. This way, your facility can have greater efficiency, lower energy costs, fuel requirements, and fewer air emissions.
The Proximity Problem
If your facility’s location makes it difficult for the grid to serve it economically, then you might want to consider installing a DER system, which can provide your electricity independent of the grid. You can also install some renewable energy sources into the mix to handle critical loads. This will save your facility a lot of money and complications.
The High Cost Problem
This is the most common problem. If your power supplier has high rates or your alternative source of energy, such as diesel, is critically expensive. You can install a DER system, particularly renewable energy systems, to generate some or all of your facility’s power.
The Low Reliability Problem
Your power supplier has a high occurrence of service interruptions, and it takes a long time to restore service after an interruption, leading to a shutdown of operations until power is restored.
A good solution to this problem is installing a DER system that can meet your energy needs when service is interrupted and also serve critical loads until service is restored. To achieve this, you can use automated sizing optimization tools like Pai Enterprise that analyze your load profile and existing energy capacity to recommend the best energy mix for optimal operations at your facility. This way, you can determine the most optimal combination of power sources that can even help you spend less on energy.
Step 2. Choose A DER Technology
Choose a DER technology that is suitable for your facility. Types of distributed energy resources include: solar systems, dual engines, gas turbines, fuel cells, diesel engines, wind turbines, internal combustion engines, combustion turbines, battery systems, etc. It is important to take into account the logistics and costs involved for your mix. For example, diesel engines are readily available, but are expensive and require periodic delivery. There is also the worry of spills and toxic fumes.
Step 3. Screen The Technology
This is the point where you perform a screening exercise of your chosen power supply mix, so that you can eliminate sources or systems that are not practical or feasible for your facility. For example, if there are low gas reserves in the region your facility operates in, then it might be quite impractical to adopt the use of gas turbines. Countries with large gas reserves are suitable for that type of system, like Turkmenistan, Russia, Nigeria, and Iran.
Step 4. Acquire The Resources You Need
Make sure to acquire assets that can be readily available, assessed, or fixed, or that can be readily supplied with the resources they need. When it comes to energy and uptime, earlier is always better. Make sure you have technical, compliance, and sustainability experts on deck to help you plan every step of the way.
Step 5. Create A DER Project Plan
After the previous steps, you should have already decided on a specific technology approach, designed to meet the needs of your facility.
Determine the possibility of the approach you have in mind, including financing, technical barriers, and permits.
Step 6. Address Unexpected and Potential Barriers
At this point, your DER project has already gone far ahead, maybe almost completed. However, despite the feasibility reports, you may encounter additional problems on the way. You need to account for and prepare necessary measures to address them. There are two barriers you need to account for: technical and regulatory barriers. Make sure to work with various appropriate entities to obtain permits, connect to the utility system, build a working DER system, and perform other activities that are external to your facility. Some of these activities will require more time and effort than you estimated or more expertise. This is the stage where you will make consultations to make sure that your plan is foolproof.
Step 7: Install And Operate Your DER
Once you have gone through all of these steps, you are ready to build and operate a new and efficient DER system. You will most likely add additional energy source(s) to your facility that will bring improvements to your operations and bottom line.
Manage Your Distributed Energy Resources With Pai Enterprise
Managing multiple energy sources can get complicated, from tracking usage to forecasting peak demand. Pai Enterprise simplifies it all as an optimal distributed energy resources management system. The energy management system helps organizations monitor, analyze, and optimize distributed energy systems in real time, improving uptime, predicting peaks, and keeping costs in check.
With Pai Enterprise, energy management becomes simpler, smarter, and more sustainable. Curious to see how seamless and effective it works? Book a demo with a simple click.