Utilities are at an inflection point. As the strain on the grid has intensified in recent decades, the role of a utility has become more complicated. In the U.S., 70 percent of transmission lines are more than 25 years old, and some parts of the grid have been around for over a century. With the added demand of solar, wind, and other renewable energy sources, the power and utility industry is quickly taking action to plan for the energy transition.
The Biden Administration and the Department of Energy (DoE) recognize this, and recently announced billions of dollars in funding to strengthen the resilience of the North American power grid. Robust federal investment offers much-needed support for large-scale projects, such as the deployment of advanced technologies to help modernize the grid.
These initiatives will better prepare the grid for the future, help utilities to take advantage of new business models and opportunities, and allow the industry to be accelerators for clean energy. Strategic technology investments will help ensure utilities can continue to provide reliable and safe energy today, while meeting the unpredictable demands of renewable energy over the next few decades to meet net zero and carbon neutral goals.
The Grid’s Clean Energy Challenges
To support the achievement of a 100% clean U.S. energy grid by 2035, utilities will prioritize initiatives that enable the energy transition. In addition to utility-scale renewables, a significant portion of net zero energy will be generated in Distributed Energy Resources (DERs), such as rooftop solar, wind turbines, and local storage systems. Not to mention, the adoption of electric vehicles (EVs) is growing at a rapid pace – according to a prediction from the International Energy Agency (IEA), over 50 percent of all vehicles sold by 2030 will be EVs. This, too, is putting a strain on a grid that is already at maximum capacity. Across the country, we’re seeing unreliable power supplies, greater disruptions, and more frequent outages.
As utilities focus on increasing renewables and integrating DERs into their systems, they are working with outdated energy infrastructure that jeopardizes operational functionality and reliability. Moreover, many continue to use manual processes to run their operations.
For example, some municipal utilities still rely on handwritten note taking to track outages, while others dispatch personnel to physically pull a switch when they need to make a control action on the grid. As the grid becomes increasingly complex with more devices, renewables, sensors, and expanded infrastructure, utilities are finding it harder to scale without the support of digital technology and automation. Manual processes are no match for modern energy demand.
Current grid systems were designed for centralized, predictable power generation flowing in one direction. They were not designed for DERs, which introduce greater complexity and variability due to their decentralized nature and the intermittency of renewable sources. For example, utilities need intelligent software to ensure the batteries attached to solar panels on a customer’s roof discharge the right amount of energy to meet a spike in demand. It would be nearly impossible to manage this manually.
Without intelligent control systems, it is difficult for utilities to coordinate and optimize their diverse grid assets for reliable and efficient operations. This leads to assets that are underutilized, overutilized, and unstable. The result is more frequent equipment failures and grid outages that only add to renewables’ intermittency issues.
Digital Technology & The Energy Transition
Digital technologies are reshaping the energy sector and empowering utilities to manage complexities, improve reliability, and better incorporate DERs into the energy landscape. Intelligent software and automated processes are indispensable in managing the growing complexity of the grid, allowing utilities to reroute power during outages, enhance reliability and safety, and optimize charging, discharging, and provide adaptive responses.
If they haven’t already started, in 2024 utilities will prioritize a robust digital foundation that can adapt to changing demands and scale over time. Large solar programs, for example, can take several years to bring online. Finding a technology partner with flexible infrastructure and modular capabilities ensures seamless integration and compatibility with new systems, even as priorities evolve.
Choosing an enterprise-wide solution that consolidates diverse technologies into a centralized system is especially critical for utilities that are just beginning their digitalization journey. It can help streamline operations, reduce complexity, and eliminate the need to manage multiple vendors and upgrade cycles. An enterprise platform that can be easily integrated with other systems ensures that features and modules can be added later as needs change, without a significant resource investment.
In one example, Distributed Energy Resource Management Systems (DERMS) optimize the integration, control, and enterprise-wide management of diverse distributed energy resources within a utility's grid. With central visibility and understanding of how thousands of DERs are connected to the grid, utilities can improve reliability and performance by scheduling and dispatching resources as needed.
Some utilities are even starting to uncover new business models and opportunities with DERMS. For instance, Public Service of New Mexico uses DERMS to manage large-scale solar projects. When excess solar energy is generated, the system strategically dispatches that energy to California’s ISO market through an automated decision-making process. In this way, a utility could incur a new revenue stream enabled by the clean energy transition and digital technology.
Connected systems like DERMS help maximize renewable resource utilization and optimize processes, benefiting both utilities and energy users — and transforming how the grid operates.
The Grid’s Clean Energy Challenges
It’s a transformative time in the energy sector, with continuous investment and innovation happening across the industry. Utilities need a digital foundation they can build upon and scale, that will help them adapt and leverage new opportunities among our evolving energy landscape.
As the industry prepares the grid for the future — and brings new, sustainable energy resources online —utilities will play a crucial role in the seamless transition towards a more reliable, safe, and sustainable energy future.
Sally Jacquemin is the Vice President and General Manager of Power & Utilities at AspenTech.
