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Rate design for a DER future: Designing rates to better integrate and value distributed energy resources

By District Energy posted 02-12-2018 10:12


Krysti Shallenberger, UtilityDive


AEE's Coley Girouard says time-varying rates are the best bet to accurately price DERs.

The U.S. electricity system is changing, driven by technological innovation, increased use of distributed energy resources (DER), and evolving customer needs and preferences. If DER assets are properly integrated into the system, they have the potential to make the grid more efficient, flexible, resilient, reliable, and clean, while simultaneously giving customers greater choices and control over energy use and costs. For this to happen, new rate designs will be needed – and some approaches to new rate design fulfill the promise of a DER future better than others.  

In the fast-changing electric power system going forward, rate designs will need to achieve multiple objectives. They will need to allocate costs equitably. They will need to compensate DER customers for the benefits DER provides and properly charge them for use of the grid.

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