pwr_october-2023 - 40

DISTRIBUTED ENERGY
Choosing the Right Distributed
Energy Resource
The decision on whether or not to invest in distributed energy resources is complicated.
Evaluating all aspects, including cost, consumption metrics, resource availability,
personal goals, and reliability needs, is important to ensure the best outcome.
Dan Nordloh
he global energy landscape is evolving
at an unprecedented pace, with
increasing emphasis on sustainable
and resilient energy solutions. Distributed
energy resources (DERs) have emerged as
a vital component in this transformation,
offering businesses and individuals the opportunity
to generate, store, and manage
their own energy. As the demand for renewable
energy grows, the decision to invest
in DERs becomes crucial. This article
explores the key considerations in selecting
the optimal DER strategy, specifically
focusing on the decision between grid-tied
and off-grid systems, and whether it's best
to invest now or delay the investment.
T
Understanding Grid-Tied and Off-Grid
Systems
Before diving into the decision-making
process, it's essential to understand the
fundamental differences between gridtied
and off-grid systems.
Grid-Tied Systems. These systems are
connected to the main electrical grid, allowing
users to generate their own energy
through sources such as solar panels or
wind turbines. Excess energy can be fed
back into the grid, often earning users credits
or compensation. Grid-tied systems are
generally more cost-effective upfront due
to reduced energy storage requirements.
Off-Grid Systems. Off-grid systems operate
independently of the main electrical
grid. They require energy storage solutions
(typically batteries) to ensure a continuous
power supply when renewable sources
are unavailable. While providing greater energy
independence, off-grid systems often
have higher initial costs due to the need for
storage capacity.
Decision-Making Considerations
The decision to invest in DERs involves
a careful evaluation of multiple factors,
including financial considerations, energy
needs, environmental goals, and
the level of resilience desired. Here's a
breakdown of the key considerations to
help guide this decision.
Financial Aspects. Grid-tied systems
generally have lower upfront costs, as
there's no need for large energy storage
solutions. Off-grid systems, on the
other hand, require significant investment
in batteries or other storage technologies.
While the initial investment for offgrid
systems might be higher, they offer
greater long-term savings by reducing or
eliminating reliance on the grid. Off-grid
systems can shield users from rising utility
costs and potential grid disruptions. You
can calculate the return on investment
(ROI) based on energy savings, potential
grid feed-in tariffs, and incentives available
in your region. Consider the payback
period for each system to determine the
optimal investment timeline.
Energy Needs. Analyze your energy
consumption patterns to determine the
size and capacity of the system you
need. Consider future growth in energy
needs and the potential for energy-efficient
upgrades in your property. Assess
the solar potential, wind patterns, and
other renewable resources at your location.
An area with abundant sunlight may
be ideal for a grid-tied solar system (Figure
1), while regions with intermittent
energy sources may benefit more from
off-grid systems with energy storage.
Environmental Goals. If reducing
1. Rooftop solar panels can be a great distributed
energy resource option for homes
or commercial and industrial facilities. If gridtied,
power can often be fed back to utility
companies to earn either credits or compensation.
Source: Envato Elements
40
your carbon footprint is a primary goal,
both grid-tied and off-grid systems can
be environmentally beneficial. Grid-tied
systems can offset the carbon emissions
of your energy consumption, while
off-grid systems contribute to reducing
www.powermag.com
overall demand on the grid. Off-grid systems
offer the highest level of energy
independence and can be a desirable option
for individuals or businesses aiming
to minimize their reliance on fossil fuels
and centralized energy systems.
Resilience and Reliability. Consider
the historical reliability of the grid in your
area. If frequent power outages are a concern,
an off-grid system with energy storage
can provide essential backup power,
ensuring uninterrupted operation. Off-grid
systems are inherently more resilient
during natural disasters or grid failures. If
maintaining power during emergencies is
a priority, an off-grid solution may be the
better choice.
Now or Later?
The decision to invest in distributed energy
resources involves a careful evaluation of
financial, energy, environmental and resilience
factors. The choice between grid-tied
and off-grid systems depends on your specific
goals and circumstances. While gridtied
systems may be more cost-effective
upfront, off-grid systems offer greater longterm
savings and energy independence.
Determining the optimal timing for
investment is equally important. If you
are ready to reduce your energy bills,
decrease your carbon footprint, and enhance
your energy resilience, investing
in DERs sooner rather than later can be
a wise decision. On the other hand, delaying
the investment might allow you to
leverage future advancements in technology,
potentially leading to more efficient
and cost-effective solutions.
Ultimately, the choice between gridtied
and off-grid systems, and the timing
of investment, should align with your energy
goals, financial capacity, and commitment
to building a sustainable and
resilient energy future. Consulting with
energy experts and considering all relevant
factors will empower you to make
an informed decision that best meets
your unique needs. ■
-Dan Nordloh is senior vice president,
general manager of EnTech Solutions.
POWER | October 2023
http://www.powermag.com
PWR_ October-2023

Table of Contents for the Digital Edition of PWR_ October-2023
