2.3   What Are the Issues on DER Technologies Affecting Regulations?

2.3.2 How May Utility Mandates to “Serve” Be Affected by the Reliability of DER Systems?

In the bulk power system, utilities, including ISOs and RTOs, directly control bulk generators according to contracts and market agreements. Protective relays in substations react within a couple of cycles to faults, sophisticated equipment respond to transient stability anomalies, and the networked design of the transmission system provide the necessary redundancy to support very high levels of reliability. SCADA systems collect real-time data with a latency of a second and operators can issue control commands within a few seconds. Load forecasts, contingency analysis, and other energy management system applications provide short-term planning support and insight.

In the past, distribution operations have relied on these transmission-level services to provide reliable energy to the substation, and have focused primarily on maintaining reliable “wires” between the substations and customers.

However, that scenario changes radically when distribution operations have to treat DER systems as additional sources of energy. Initially, transmission-supplied energy could compensate for any reduced reliability of DER systems. But as more generation is supplied locally, the distribution system will need increasingly to rely on that local supply if they are planning to avoid over-building the distribution system.

Customer-owned DER systems (as opposed to utility-owned or IPP-owned) are generally less reliable for providing energy and any ancillary services to utilities, simply because their primary purpose is to serve their owners, not the grid. Although contracts and market forces can pressure these DER owners to support grid reliability, ultimately these owners may make decisions to further their own needs over those forces. Distribution utilities can partially off-set this lower reliability of specific DER systems by having large numbers of DER systems available to provide these services. Thus the lower reliability of one DER can be compensated statistically by having many other sources.

However, careful planning will need to ensure those alternate sources are able to compensate for the specific location and services required. Thus Distribution Resource Planning (see 3.6.1) will need to include statistical analysis of the “reliability” of customer-owned DER systems, in addition to the inherent reliability of renewable energy sources.