Jan 20, 2025
An aging grid and rising demand show centralized power's struggle.
The combination of an aging grid and ever-growing demands powered by modern technology is making it abundantly clear that centralized power is struggling to keep up. Neither the U.S. nor any other country can continue with the status quo and expect to faithfully meet the energy needs coming in the very near future. This reality leads us to renewable energy and distributed energy resources (DERs). Are they the keys to decentralization?
At least one industry expert thinks so. POWER Magazine contributor Darrell Proctor makes a strong case for both decentralization and DERs in a post published in the magazine's January 2025 edition. The post is well worth reading if you follow renewable energy and power generation news.
Proctor's main premise is that local communities cannot necessarily rely exclusively on the traditional grid any longer. When loads get too heavy or the grid goes down, communities need some sort of supplemental power to keep things running. Proctor believes that DERs can provide that supplementation in conjunction with renewable energy sources.
A Word About DERs
If you are unfamiliar with DERs, they are essentially small-scale supply or demand resources connected to the grid. A common scenario has a DER located very close to a load center for the purposes of adding value to the grid.
DERs can be built as either physical or virtual assets. In the physical realm, they tend to be under 10 MW in total capacity. They include assets like:
Solar power arrays
Small wind farms
Energy storage systems
Supplemental power generators
Microturbines
Virtual DER assets include things like demand-response resources that help to regulate the flow of power. Ownership of both physical and virtual assets varies. Utilities, independent producers, and local businesses can all own and operate assets.
Applying Them to Decentralization
The concept of decentralized power is pretty simple to understand. Rather than relying exclusively on a small number of corporate utilities utilizing an aging grid, communities begin developing their own power generation and distribution capabilities.
In the short term, this means still relying on the existing grid for distribution purposes. But by building more limited capacity DERs, local communities can take greater responsibility for their own power needs over time. Locally produced power can still be distributed across the grid but in a more responsible way.
Embarking on a decentralization strategy opens the door for communities to invest more in renewable power. For example, even as a local community still depends on the grid for most of its power needs, it can invest in solar or wind to supplement.
Why It's a Good Idea
Whether or not decentralization would lead to major utility breakups is a matter of debate. Either way, decentralization is still a good idea. It has its benefits; benefits that will only become more apparent as technological investments continue to stress our current resources.
Decentralization means that local communities and smaller utilities do not have to put all their eggs in a single generation basket. They can use a variety of technologies and power generation strategies to address everything from extreme weather to grid outages.
Building DERs also allow utilities to better balance supply and demand, reduce energy losses, and increased stability for customers across the grid. With so much potential, it is a wonder we aren't investing in more DERs.
Should future energy solutions make decentralization a reality, their success could hinge on the right combination of renewable energy sources and DERs. For now, however, we wait to see how it unfolds. The future of power generation will be interesting no matter how things go.
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