Distributed energy resources (DERs) are small-scale energy resources usually situated near sites of electricity use, such as rooftop solar panels and battery storage. Their rapid expansion is transforming not only the way electricity is generated, but also how it is traded, delivered and consumed. Accordingly, DERs can create new power system opportunities, but at the same time, can pose new challenges when a grid has not been properly prepared. Many jurisdictions are just beginning to understand how DERs fit into the wider energy landscape – what they are and what impacts they have on the grid, and how they can be used to improve system reliability and reduce overall energy costs. Meanwhile, other regions have built up experience with DERs, demonstrating that they can provide valuable services to the grid when incentivised with appropriate technologies, policies and regulations. Nonetheless, not all countries use the same electricity market model or are at the same stage of DER penetration, and the fit-for-purpose solutions will vary from place to place. This report reviews lessons from forerunners and distils best practices (with examples and case studies) to help policymakers, regulators and system operators across the globe understand what experience is most relevant to their own situation. Readers will be able to draw on a wide range of practical insights for electricity market design and regulation to help unlock the multiple grid benefits of DER technologies.
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