Market Trends: Distributed Energy Resource Management Systems (DERMS)

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Executive Summary

The rise of decentralized energy resources has introduced more complexity to electricity networks – and challenges around grid congestion, bidirectional power flows and voltage instability. Traditional grid management systems were not designed for this level of decentralization, necessitating the emergence of distributed energy resource management systems (DERMS). This report informs organizations on the current DERMS functionality helping utilities, aggregators and market participants optimize DER integration while ensuring grid reliability and efficiency. Additionally, the report provides insights into market segments and portfolios of solutions, the vendor ecosystem, and trends and future pathways for DERMS.

Table of contents

Summary for decision-makers
Complexity of electricity systems calls for greater interconnection, visibility and control of assets

Power generation is increasing and decentralizing to support widespread electrification
The rise of distributed renewable energy sources brings new challenges
DERMS emerged to mitigate DER management challenges
Players at each stage of the electricity value chain are potential DERMS buyers
Two kinds of DERMS – grid and edge – address market needs
Seven functionality areas define today’s DERMS space
The DERMS spectrum: one size does not fit all
The road ahead for DERMS: barriers to overcome and market trends
Widespread adoption of DERMS still faces obstacles
Introducing three different pathways for DERMS

Table of figures

Figure 1. Global electricity consumption trends: 2000 to 2050
Figure 2. Global power generation trends: 2000 to 2050
Figure 3. UK generation and demand profiles: July 1 and Jan 1
Figure 4. Position of DERMS in the electricity system and interaction with different system segments
Figure 5. Edge vs grid DERMS
Figure 6. DERMS functionality
Figure 7. DERMS solutions ecosystem

About the authors

Hector Aguirre

Industry Analyst

Hector is an Industry Analyst in the Verdantix Net Zero and Energy Transition practice. His current research agenda focuses on distributed energy resource management systems. Prior to joining Verdantix, Hector worked at Jacobs where he gained experience in energy technologies, decarbonisation and net zero strategies. Hector holds a BEng in Mechanical Engineering from the University of Bath and an MSc in Sustainable Energy Futures from Imperial College London.

Ryan Skinner

Research Director, Net Zero & Climate Risk
Ryan is the Research Director for the Verdantix Net Zero & Climate Risk practice. He guides the research team to develop compelling research at the intersection of net zero strategies, carbon management, climate risk and technology. Prior to joining Verdantix, Ryan was a principal analyst at Forrester Research, where he initiated the research into ESG data and analytics offerings. He also has extensive experience of helping software companies with their messaging, positioning, market and technology strategies. Ryan studied at Duke University, the University of Manchester and the University of Oslo, and speaks Norwegian fluently.

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