A new whitepaper report from the Solar Energy Industries Association (SEIA) and Current Energy Group says distributed energy resources could be the way forward for the U.S. energy industry.

The association’s Distributed Capacity Procurement (DCP) Framework whitepaper is a response to the shifting energy industry, SEIA officials say. The framework aims to better align the renewable energy industry with modern electrical needs, as energy leaders and regulators across the U.S. continue to struggle with rising demand, spiking prices, and aging infrastructure.

SEIA’s Samantha Weaver says that without adding more in-depth procurement pathways for distributed energy resources, the grid will not have the resources it needs going forward.

“We need more electricity on the grid added fast, and traditional approaches that rely on utilities alone to meet that demand are no longer going to cut it,” says Weaver, the association’s senior director of state regulatory affairs. “Distributed energy resources can provide much-needed capacity at the speed and scale required to meet the moment. The Distributed Capacity Procurement Framework outlined in this whitepaper provides a practical roadmap for regulators and policy leaders working to build a 21st-century grid that can meet the needs of the 21st-century economy.”

The new whitepaper draws on years of expertise and policy work by SEIA, especially its Distributed Power Project team. SEIA representatives say the association can now much better handle the topic, following its combination with the Coalition for Community Solar Access (CCSA).

Three pathways to one solution

The new whitepaper offers a trio of procurement pathways for distributed energy resources, which could prove crucial to the industry going forward.

First up, the pathway of programmatic tariff-based procurement, which would allow customers and third-party developers to deploy distributed resources at scale, via standalone programs. The whitepaper states that solar and storage assets are “most appropriate” for this particular pathway, but the pathway itself works best as a primary procurement mechanism, paired as a complement with targeted planning integration.

The second pathway, tariff-based procurement with competitive price discovery, puts a more bespoke spin on the first pathway. Designed to address “specific capacity and grid service needs,” the pathway involves intentional planning of distributed resources, which results in focused resource integration.

“Like Pathway 1, Pathway 2 meets several grid challenges by employing a standardized procurement mechanism,” the whitepaper says,” but is distinct in that it leverages more advanced system planning processes.”

A non-tariff solution

The third pathway involved competitive solicitation, or procurement based on requests for proposal. Best applied in specific circumstances where tariffs are impractical, the pathway works best where planning procedures can “identify highly specific grid needs at precise locations.”

“Pathway 3 is designed to acquire DERs that meet bespoke, explicitly defined grid needs,” the report says, “whereas Pathway 2 procurements, although targeted, are technology-neutral and have a more expansive set of technological specifications.”

The all-encompassing mission is to find the best way, or combination of ways, to procure and deploy distributed energy resources to maximize benefits. SEIA says the framework whitepaper answers that question with a practical roadmap, but it is up to political actors and regulators to follow the map toward a modernized, decentralized energy grid.

“Distributed energy resources are well-positioned to address load growth, aging infrastructure, and rising energy bills,” says Matthew McDonnell, managing partner of Current Energy Group. “Unlocking their full potential requires pragmatic frameworks that enable customers and competitive, transparent, and fair market-based solutions to help meet that demand.

“This body of work provides regulators with a comprehensive set of strategies for procuring DERs and maximizing their cost-saving and grid-strengthening benefits.” 

— Solar Builder magazine