Defining DERs: Does it matter that we all seem to have slightly different definitions?

Defining DERs Word Cloud

Over the last few years, the term DER has become more and more commonplace in the energy space. Most of us know that this three letter acronym (TLA, get it?) stands for Distributed Energy Resources, but what Distributed Energy Resources are might be a bit fuzzier. That’s partly because the definition of DERs varies based on who is defining or using it.

Significantly, the various definitions are not contradictory, and probably unsurprisingly, reflect the perspectives of those groups composing the definitions. For energy professionals and particularly utility staff—planners, analysts, customer engagement specialists and executives—the key is consensus. Within any organization or group of organizations, what DERs encompass should be clearly defined and agreed upon. This is important if tactical and strategic decisions about system planning will be based on analyses of DERs in one or more specific locations (e.g., a service territory or balancing area).

Let’s start with a quick review of how several highly respected organizations have defined DERs.

Organization Definition Source Year

Distributed energy resources are small, modular, energy generation and storage technologies that provide electric capacity or energy where you need it.

Using Distributed Energy Resources

2002 (!)

 EPRI Logo

[Distributed Energy Resources (DER) are] technology advancements in connected loads, solar photovoltaics (PV) and energy storage.

Common Functions For DER Group Management, Third Edition


 CA Public Utilities Commission Logo

 Distributed energy resources (DER) [are] defined as distribution-connected distributed generation resources, energy efficiency, energy storage, electric vehicles, and demand response technologies.

California’s Distributed Energy Resources Action Plan: Aligning Vision and Action


 Pacific Northwest National Laboratory Logo

DER as used in this report includes distributed generation, distributed energy storage, energy efficiency, demand response and electric vehicles.

Modern Grid Distribution Project


 City of Palo Alto Logo

Distributed Energy Resources (DERs) [are] electrical energy resources connected to the electric distribution system that can significantly change the location, timing, and magnitude of …electric loads. This includes …distributed renewable generation resources such as solar photovoltaics (PV), energy efficiency (EE), energy storage (ES), electric vehicles (EV), and demand response (DR) technologies, as well as interactive and flexible resources such as EV smart chargers, smart thermostats, heat-pump water heaters (HPWH), and heat-pump space heaters (HPSH).

Memorandum to Utilities Advisory Commission


 SEPA Logo

DERs are physical and virtual assets that are deployed across the distribution grid, typically close to load, and usually behind the meter, which can be used individually or in aggregate to provide value to the grid, individual customers, or both.

Distributed Energy Resources 101: Required Reading for a Modern Grid


 NERC Logo

A Distributed Energy Resource (DER) is any resource on the distribution system that produces electricity and is not otherwise included in the formal NERC definition of the Bulk Electric System (BES).

Distributed Energy Resources Connection Modeling and Reliability Considerations


 ISO NY Logo

The NYISO defines DER as a resource, or a set of resources, typically located on an end-use customer’s premises that can provide wholesale market services but are usually operated for the purpose of supplying the customer’s electric load. DER can consist of curtailable load (demand response), generation, storage, or various combinations aggregated into a single entity.

Distributed Energy Resources Roadmap for New York’s Wholesale Electricity Markets



In the examples above, I’ve highlighted the key elements of each definition in green. It’s obvious even from a quick scan of the terms in green that there is more in common between definitions than not. While the notion of production/generation/supply/sourcing is common to nearly every definition, only NERC’s explicitly and exclusively defines DERs as producing electricity. Storage is another common theme we see in these definitions. Even NREL’s definition of DERs from 2002 calls out storage (the context, as can be seen from the linked PDF, was commercial and facility oriented).

SEPA has the most atypical definition, but it seems to be one that recognizes the pace and nature of change in the space. It identifies virtual assets along with physical assets; but rather than defining technologies that are DERs, communicates that DERs “provide value to the grid, individual customers, or both.” Thus, SEPA defines not so much what DERs are in a tangible sense, but rather what they do. And it elevates the what they do to a qualitative level of providing value. Presumably, this value could be from generation, consumption, economic savings, etc.

Of course, the biggest difference among these definitions is whether they include things that aren’t in the production/generation/supply/sourcing or storage spectrum, e.g., loads and things that modify them, like energy efficiency and demand response. EPRI, CPUC, PNNL, CPAU and NYISO all either mention load or an example of a specific type of load (e.g., electric vehicles).

I’ve included the date in the table above so that we can get a sense of whether the definitions are converging over time. Based on the evidence here, I would argue that they are not, though to be fair, most of them are from the last year or so. Nonetheless, I would argue that it is not surprising that there are varied definitions: groups are often choosing to define DERs as they see fit, though generally with some common themes as we see above.

How DER definitions are influenced by context

These organizations—and, in the case of the membership organizations like EPRI and SEPA, their member utilities—generally have distinctive characteristics of technology focus, customer base, load, climate, generation and, to some degree, regulatory requirements or charters. So, it should not be surprising that any particular utility might latch onto a definition of DERs that is appropriate for their context. They may, in turn, develop programs, educate customers and plan their grids according to their perspective on DERs.

Businesses like Clean Power Research must take a breadth-based but ultimately modular view of DERs since we are busy developing algorithms and analytical approaches for tools used by utilities, their customers and the larger energy market.

When one considers a membership-based organization like SEPA, formerly the Solar Electric Power Association and now the Smart Electric Power Alliance, it is similarly easy to understand why they take a comprehensive view of DERs: they are serving a multitude of different constituencies (particularly utilities) that all likely have slightly different definitions. The utility (sorry) of SEPA’s content and forums is, in fact, enhanced by this diversity of perspective. In short, we don’t have uniformity in this country among utilities as organizations and so we shouldn’t expect uniformity in the initiatives of those utilities.

However, DERs are not just feel good things with no impact. They are having increasingly profound effects and prompting deep, technical discussions and changes within individual utilities, among interconnected utilities and their corresponding ISO or grid managers, and with regulators. That’s why the definitions and unique areas of consideration, especially in those multi-party forums, is important to share.

Preparing for a future of DERs

So, what is the imperative for utilities and others attempting to make decisions about DERs in the context or integrated resource planning or grid modernization efforts?

  1. Make sure your tools embrace variations and evolution in the definition of DERs. Are they flexible and modular? Can your organization use any DER definition from above or change its preferred definition over time (for example, excluding certain technologies from an analysis initially but adding them later)?
  2. Because the definitions of DERs are so varied, ensure that your tools can integrate with a variety of systems so that the requisite source data for analyses can be processed. I’m not just talking about one-time imports. Tools should be able to be persistently integrated if that is desired so that they get a continuous and up-to-date feed of inputs and parameters to properly perform analyses.

With any definition of DERs, we see a tangible manifestation of the energy transformation. I’ll elaborate on a strategy of integrate and optimize vs. the oft-attempted rip and replace in my next post.