Moving electricity delivery from last-mile to frontline.

• Author: Rahim, Shahid
• Position: Distributed energy resources

Byline: DR. SHAHID RAHIM

"The true voyage of discovery does not lie in seeking new landscapes, but in having new eyes." (Marcel Proust)

Electricity distribution which was thought to be the last-mile of the electricity supply industry's value chain until recently is rapidly gaining new importance. It's now being considered the frontline of this business where most of the action will take place in the future. A consensus is evolving among industry experts that merely improving the efficiency of this system and revenue collection, important as these are, may not be sufficient to confront the vexing challenges this industry faces. Its distribution function will require systemic transformation to effectively deal with the emerging challenges. Some pointers for managing the desired transformation of this function are provided below.

Multiple developments in the world's energy market have altered the fundamentals of the electricity supply industry (ESI). Small power plants now beat the cost and performance features of large plants. Renewable power generation is proving competitive with conventional technologies. Battery storage technologies coupled with rooftop PV systems are enabling consumers to reduce, and even eliminate, their traditional dependence on the grid. Electric vehicles (EVs) and their charging facilities are also opening up new vistas for their dual role as loads as well as sources of supply. Smart information and communications technologies (ICTs) are unlocking new opportunities for power control and management in the grid.

The above developments-often termed "disruptive forces" by utility analysts-are impacting every part of the ESI. However, the real challenges they pose are to the distribution function as most of these will connect at low and medium voltages. Distribution systems which were designed for most part of this business' history as passive networks to convey power in one direction only, from central-station generation plants to end users through the transmission grid, cannot handle the stresses that the presence of small and distributed technologies impose on them.

The distribution function consequently needs a thorough transformation to effectively deal with the new technical, managerial, and commercial challenges. We elaborate on each of these aspects below, but not in any specific order, as each aspect is critical and complements the others. We use the term "distributed energy resources (DERs)" to refer to these technologies for their role as new sources of supply, including storage when it's operated in that mode. Strictly speaking, ICTs are not a DER but an enabler to connect and...