Most utilities in North America have a mission to provide affordable, safe, secure and reliable access to electricity (perhaps gas and water too) while protecting the environment. An increasing number of DERs are being integrated into the energy mix which is broadly good news for the environment.

Nevertheless, managing their proliferation on the grid represents risks to the network. Utilities start to see congestion—previously a transmission challenge—occur in the distribution network.
Reinforcement of the grid is one means of ensuring sufficient capacity to meet supply and demand. However, this solution can be time-consuming to realize and disruptive for businesses and citizens. Moreover, building physical infrastructure to provide capacity for peak loads—a small fraction of the total operating hours each year—is capital investment for potentially limited ROI.

What are the implications and risks of congestion in the distribution network? What are the solutions?

For more than a century, operators have optimized a “downstream” flow of energy. Their approach to grid management has been based on central intelligence, optimization and rigid processes and lacks the speed or flexibility required to control today`s disruption at the grid edge. The traditional system view cannot grasp what is going on behind the meter. And even if it could, the understanding of customer behavior and motives, essential to efficient grid management, is elusive. Going forward, utilities will need to flip perspective and start thinking more about the customer. to conceive new services and solutions for their customers while managing the constraints of the physical grid.

1. Flexible in every way:
More flexibility in the system is essential to combat congestion and will require some asset, but largely software and behavior-related actions.

2. It's about the data, although software is not the silver bullet:
Improved IT/OT integration can allow utilities to combine software, asset and customer behavior-related insights into a valuable masterplan.

3. Divide and conquer but keep control:
Utilities must set the framework for others to assume some of their existing and new roles.

4. Value-based mechanisms change the game:
A truly customer-centric system that follows a value-based approach must emerge. In this new reality, every action is evaluated according to the positive and negative consequences it has on the grid, and charged accordingly.

5. Regulators must keep up:
Without the timely collaboration and anticipative forward planning of regulators, utilities risk being ill-prepared for congestion when it inevitably becomes a reality. With the right mindset, regulators can become ambassadors and enablers of an age of customer centricity.

"The grid is more and more becoming a bandstand, and everybody is dancing around at their own pace. Utilities need to be the orchestra leader who sends the signals to coordinate and keep order within the system."
Research respondent
 

Quite simply, the proliferation of DERs is not going to cease and therefore the threat of congestion is not ephemeral. Moreover, our research exposes that there is neither a single solution, nor a single executive equipped to solve the problem. There are however, clear steps utilities can take themselves, with the broader ecosystem, with regulators, and with vendors to combat congestion.