The global distributed energy resources management system (DERMS) market size was worth US$ XX million in 2020 and is estimated to reach US$ XX million by 2028, growing at a CAGR of XX % during the forecast period (2022-2029).
A distributed energy resource management system is a software platform that manages a group of distributed energy resource assets, such as behind-the-meter batteries, rooftop photovoltaic solar panels or a fleet of electric vehicles to deliver vital grid services and balance demand with supply to help utilities achieve mission-critical outcomes.
A utility operator can utilize DERMS surgically to maintain operational needs, meeting demand through prioritization aggregation of resources, with the overall goal of depreciating disruptions. One of the fundamental issues facing distribution utilities is managing high intermittent distributed energy resources levels. The DERMS assist in managing the technical, operational and economic challenges of interconnected DERs. Its situational awareness mitigates DER impacts, presenting key economic value for distribution and bulk power systems and retail customers.
Source: DataM Intelligence Analysis (2021)
Rising investments in distributes energy resources drive the global distributed energy resources management system (DERMS) market.
Rising investments in distributed energy resources
The rising deployment of distributed energy resources has been of interest, primarily to consumers and local electricity distribution utilities. At present, DERs are quickly becoming the foundation of the energy market, enabling the users to generate, consume and store electricity using varied technology categories.
DERMS have been widely in demand for managing increased DER adoption and providing operators with insights to increase customer interaction and synchronization of the assets. Unstable grids and reliability problems can occur from influxes of improperly distributed generation technologies. Key players are opting for DERMS to maintain grid flexibility and lessen outages.
The market has witnessed various investments in the DERMS market to optimize the operations in the DER market. For instance, in 2021, Smarter Grid Solutions was selected to provide active network management for flexibility management in the QUEST project with Electricity North West, National Grid Electricity System Operator (ESO) Schneider Electric. The innovative plan will free up network capacity of over 2GW of clean energy assets in the UK, saving around US$ 335.8 million (£ 250 million).
Smarter Grid Solutions is awarded US$ 10.7 million (£ 8 million) through the Network Innovation Competition QUEST for its DERMS software. The company will create a coordinated, overarching system for controlling voltages & balancing centralized & decentralized energy control systems.
Regulations related to the distributed energy resources
The regulations related to the DER can be a major factor restraining the distributed energy resources management system (DERMS) market growth. The ability for DER to market electricity has largely been limited to state-approved retail programs such as net metering. Current Federal Energy Regulatory Commission rules regulated wholesale markets restrict most DER from participating due to their smaller size.
However, governments have gradually supported the DER market by enforcing new laws to overcome market restraints. For instance, in 2020, the Federal Energy Regulatory Commission issued a landmark final rule, Order No. 2222, to eliminate barriers for distributed energy resources to participate in wholesale markets regulated by FERC through aggregators.
Covid-19 Impact Analysis
Due to the pandemic, stakeholders across the distributed energy resources management system (DERMS) industry have been stable. Covid-19 is crashing the economy and companies that develop microgrids and other distributed energy resources are also facing challenges, but there are various ways that utilities can help.
Solar and other DERs are particularly important during this crisis because they can decrease costs for homeowners struggling financially. Promoting alternative energy production as a viable financial decision, especially during Covid-19, inspires individuals to continue investing in the local sustainability industry, especially solar and wind energy.
Distributed energy companies are working on their plans to keep moving projects forward. For instance, Veolia, which creates sustainable energy, water and waste projects, is staggering work schedules so that fewer operators are on the job at once and can manage social distancing goals. The adoption of distributed energy resources management system (DERMS) is predicted to pace up its growth after the pandemic and will succeed in new models being put in place. The pandemic and economic disruptions have changed the landscape for future work of distributed energy resources management system (DERMS) technologies.
By technology, the distributed energy resources management system (DERMS) market is segmented into solar PV, wind, reciprocating engines, fuels cells, gas/steam turbines, energy storage and others.
The reduction in prices has boosted the sales for solar PV DERMS
Solar PV technology holds a significant market share globally for the distributed energy resources management system (DERMS) market. Solar PV can be positioned on rooftops or ground-mounted and is considered the largest distributed power globally. The gradual transformation to distributed energy resources from the centralized energy source is increasing its growth.
Moreover, the reduction in the prices of solar PVs is attracting consumers in the sector. Distributed solar photovoltaic systems can supply electricity during grid outages resulting from extreme weather or other emergencies. DERMS can limit photovoltaic output in real-time to limit reverse flows and high local voltages. Unprecedented US solar PV expansion of almost 17 GW is forecast for 2020, the highest annual increase to date.
The expanding investments in solar PV and evolving government regulations linked with upcoming projects are expected to boost the DERMS market during the forecast period. In 2020, the U.S. solar PV expansion reached almost 17 GW, the highest annual increase to date. According to the IEA report, in 2018, distributed-scale solar PV capacity increases amounted to approximately 43 GW). China serves the leading solar market, with distributed plants offering 47% of the capacity installed in 2018.
Distributed solar has been increasing in India, where rooftop capacity moved 6 GW in 2018, representing an increase of more than 2.5 GW over the previous year. The Republic of Korea has developed distributed power production with a policy goal for its energy planning. The Tax incentives associated with distributed solar generation and solar stations are driving distributed solar PV globally.
Source: DataM Intelligence Analysis (2021)
Presence of millions of distributed generation units in North America has boosted the market
North America region holds the significant market share for the distributed energy resources management system (DERMS) market. As modern distributed energy resources penetrate the grid and DER capacity additions are expected to pass new centralized generation capacity additions soon, utilities and grid operators cannot manage to wait to combine distributed energy resource management systems into their existing infrastructure.
DERMS can support a low-carbon system while improving grid reliability, flexibility and hosting capacity. The presence of countries such as the U.S and Canada, which have over a million distributed generation units, drives the demand for DERMS. The counties have added several laws for integrating renewables, such as installing rooftop solar PV, which is expected to grow the DERMS market in the region. Moreover, a large share of the region's utility needs more reliable ways to maintain and control assets on its distribution system.
Source: DataM Intelligence Analysis (2021)
The distributed energy resources management system (DERMS) market is moderately competitive with rising penetration of distributed generation resources, such as energy storage, solar PV and microgrids globally. Global companies dominate the market due to their presence in numerous countries. Some of the key players contributing to the market's growth are ABB Ltd, Engie SA, Autogrid Systems Inc, Siemens AG, AutoGrid Systems, Inc., Spirae, Inc., Schneider Electric, Enbala Power Networks, Inc., Smart Electric Power Alliance, Emerson Electric Co and others. The players are adopting various new strategies to dominate the market, such as service developments, partnerships, acquisitions and collaborations, contributing to the global growth of the distributed energy resources management system (DERMS) market.
Emerson Electric Co
Overview: Emerson Electric Co. is a multinational corporation headquartered in Ferguson, Missouri. The Fortune 500 company provides engineering services for a wide range of commercial, industrial and consumer markets.
Component Portfolio: The Company's Emerson DERMS software is currently operational at several major North American utilities, empowering active management of DER to enable reliable use of renewable energy.
Key Development: In 2020, Emerson completed the purchase of Open Systems International, Inc. for US$ 1.6 billion. OSI Inc. is a technology software provider helping customers in the global power industry and other end markets transform. OSI provides DERMS software to 14 utilities in the North American region, including PSE&G and SMUD.
The global distributed energy resources management system (DERMS) market report would provide approximately 53 market data tables, 48 figures and 180 pages.
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