The challenges of distributed energy resources

As the growth of distributed energy resources (DERs) accelerates, it is important to recognise the challenges it creates for traditional, centralised grid systems.
Published: Thu 20 Sep 2018

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Growth in DER capacity and the broad diversity of related technologies has expanded the means of consumer engagement with the grid. A number of opportunities and challenges arise out of
increased decentralisation.

If grids can adapt to this transition, low-cost consumer participation in both supply and demand side can provide important new sources of clean energy and function as
competition for existing large-scale generation.

However, if poorly addressed, the resultant weakening of global grid systems will cost all electricity stakeholders. Rather than restrict DER or invest in network infrastructure, utilities must seek to adopt smart technology that empowers them to maintain power quality at least cost while ensuring the customer is protected.

What is happening?

The problems of hosting high DER penetration is beginning to show throughout modern grid systems. Difficulty managing voltage rise especially has become one of the major problems for grid
operators.

Traditional electricity networks were designed to supply electricity in a single direction from the generator to consumer. This allowed for voltage supply to steadily drop as it moved from substation to customer. This meant networks primary concern was the avoidance of the voltage sag for those customers at the end of a feeder line.

For DER technologies such as solar and batteries to export electricity upstream from the grid, they must do so at a higher voltage than their local supply. As a result, grids are now beginning to see significant overvoltage events occurring during midday when PV generation is highest and solar inverters push up local voltages.

This new element of voltage variability poses immense complexity and technical challenges to grid operation. As penetration increases, so too does the scale and intensity of impact. Research has established that once local solar PV penetration reaches 25%, all local customers will be impacted by voltage rise.

Why does it matter?

If rising voltage levels are not managed well, system-wide costs will increase, and the end-user will suffer. Maintaining a safe customer voltage is critical to ensure that consumer electronics are not damaged and do not operate inefficiently, or simply fail. Impacts of high voltage include:

1. Consumer appliances degrade at a faster rate. This will be especially problematic as appliance electrification increases and consumers invest more in expensive electronic assets. In 10 years the largest appliance in the household will be your battery, whether for the car or the home. Battery life degrades significantly faster at high voltages.
2. The feasibility of existing and future consumer investments in DER will be worsened as performance and output is reduced. The ability for DER to contribute to grid supply and stability is severely compromised by high and unreliable voltage levels on the LV system
3. When hosting capacities are finally reached, consumers may be restricted from implementing any DER. This has been the case in Hawaii as well as certain areas of Australia with high domestic solar penetration
4. Consumers network charges will rise if distributors must make costly investments to regain control of power quality. This is politically unacceptable and penalises non-home owners and lower socio-economic groups.

Where is this happening?

A brief review of recent power quality research shows that increasing overvoltage is occurring throughout grid systems in Asia, Europe and the Americas. The issue is being made increasingly
visible to consumers as they adopt monitoring technologies to validate performance.

Perhaps worst of all is the overvoltage crisis currently unfolding across Australia. DER uptake within Australia has seen extraordinary growth since attractive subsidies and feed-in tariffs were first
offered in 2008-2011.

Since then uptake has not slowed, with monthly installation-capacity records continually broken even throughout 2018. Coupled with higher than global-average voltage standards and large LV areas with long rural power lines, Australian networks face an incredible challenge in managing consumer voltage as DER increases.

Recent evidence of this problem was witnessed when a large Australian retailer, AGL, attempted to implement and operate a Virtual Power Plant (VPP) based around domestic energy storage in South Australia.

The project was unsuccessful, with operational effectiveness and availability of AGL’s VPP severely impacted by high voltage:

- More than one-quarter of systems installed experienced high grid voltages outside code (greater than 256V). When voltages are outside the code, inverters are required to switch off, thereby negating the business case for the reliability of supply
- 12.5% of energy storage systems in the small fleet experienced persistently high voltages outside code (greater than 256V)
- More than half of the energy storage systems at some point recorded voltages outside code (greater than 253V)
- AGL observed voltages over 256V in the day between 10am and 6pm (AECT), consistent with high grid voltages being caused by high levels of solar generation

In tandem, the operation of VPP’s have been identified as being a voltage threat themselves. The aggregation of consumer DERs under central control presents particular challenges if simultaneously discharged in the same local area, pushing up voltages to unsafe levels. As was seen in a recent 100-customer VPP battery trial in South Australia, rapid discharging in response to a market price signal results in dangerous voltage swings.

What should be done?

If networks can improve utilisation of existing and future DER, these challenges may be converted into opportunities for system-wide efficiencies and enable the consumer to better exchange value with the grid. To do this, networks must balance control of DER with consumer protection.

This will require implementing cost-effective, smart technologies that dynamically manage DER while never compromising consumer safety. Whatever technology pathway a network chooses to pursue, it must ensure that certain capabilities within the low-voltage network are enhanced:

Visibility/Insight

Primarily, any technology adopted or supported by networks must provide some degree of understanding into end-user consumption and generation. This will ensure accuracy of network modelling and forecasting of supply/demand. This capability will be foundational for improving network control of DER.

Control

Most importantly, networks must increase intelligent control capabilities of DER generation. This is currently being pursued by networks globally through the implementation of dynamic export limit systems using smart inverters.

Creating dynamic export schedules that shift consumer export maximums to reflect changing technical limits would allow networks to better manage DER export impact. This would importantly allow consumers to maximise export without negatively impacting the grid at times of congestion. This would decrease reliance on network upgrade for these peak periods. Networks in California, Germany and Australia see dynamic export as an important least-cost pathway for their burgeoning DER base.

Protection

Throughout this transition, networks must plan for uncertainty and never compromise consumer safety, security and quality of supply. Additional technology will be necessary to ensure that if operational failures of new DER management systems fail, consumers will remain protected. For example, implementing a dynamic export system will push a grid system beyond its traditional DER hosting capacity. This may increase consumers vulnerability to more severe impacts than previously should the dynamic system fail. A communications failure might cause inverters to revert to an incorrect export level and consumers suddenly suffer severe power quality issues such as voltage swings. In this instance, protective technologies such as surge or voltage regulation that still facilitate and support future DER management systems would be a necessity.

In developed economies we have come to take for granted the reliability and stability of our local electricity network. As DER penetration accelerates over the next decade, voltage control and grid stability will be the key challenges for LV network operators globally.  The answer does not lie in restricting further DER rollout.  That genie is well and truly out of the bottle and politically it is unsustainable to pick winners and losers in the domestic DER space. 

The focus must be on greater visibility and control of voltage at the point of load and investment in technologies which both protect the consumer from the effect of high voltages and provide confidence to the consumer that her investment in energy savings and the environment is not going to be undermined by the inability of operators to maintain a safe, stable and reliable low voltage network.