Interoperability of distributed energy resources: Benefits, challenges, and solutions

Global overview of interoperability challenges facing energy transitions. This report was produced for Integrate to Zero as part of their broader work to accelerate energy transitions.

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Overview

This report considers the benefits of interoperable distributed energy resources (DERs) for residential and commercial consumers and the interoperability challenges that these users face when integrating devices with the grid, or for specific use-cases (grid-trade, back-up power, ancillary services).

DERs are integral to the energy transition and play an increasingly important role in the modern power grid. With DERs installed, consumers can experience a range of benefits such as lower energy bills, cheaper EV refuelling, and access to backup power in a blackout. DERs can also provide a range of grid-side benefits, from balancing variable supply and demand, to providing black start capability. 

However, to maximise the benefits available to the consumer and the grid, DERs must also be to some extent ‘interoperable’ – capable of communicating and coordinating with other pieces of hardware, software, and various energy market actors. Interoperability is widely considered a pre-requisite for a reliable, resilient, and sustainable energy system.

However, consumers, product developers, and energy market actors currently face a range of interoperability challenges, often due to DERs that are not designed ‘from the ground up’ to be interoperable. 

Manufacturers are often hesitant to develop interoperable solutions because of cybersecurity concerns, existing market advantages, and added development costs. 

Yet, policymakers have also played a considerable part in determining the level of guaranteed or certified interoperability, with varying levels of success globally. Noting the prevalence of such interoperability challenges, and the issues of reduced functionality that can arise from limited interoperability, this report offers advice and possible solutions to consumers and policymakers.

Key findings:

  • Consumers must make informed choices depending on the complexity of their system and the level of functionality and ‘futureproofing’ they desire.
  • Interoperability of DERs on-site and on-road becomes a greater issue for consumers when there is a need for grid integration.
  • Where you live can have a big difference on the level of consumer choice, system value, and interoperability that is available. This is true even within countries like the United States.
  • Over-the-air software updates are sold as a key feature of EVSEs, inverters, and batteries which could increase interoperability as new standards are released. It isn’t always clear to consumers where products will be updated or if hardware restrictions preclude this.
  • Interoperability challenges vary considerably between devices and use-cases. Interoperability is less of an issue for solar-inverter or generation-only set-ups, but there are more challenges when incorporating EVSEs and batteries for storage or back-up power.

 

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