The future of energy relies on going small by employing microgrids and focused usage analysis, according to a white paper released by the Solar Energy Industries Association. SEIA staff compiled lessons learned from experiences in California and New York, - the two leading alternative-energy states - for the fourth installment of its series called Improving Opportunities for Solar through Grid Modernization.

The paper, titled Getting More Granular: How Value of Location and Time May Change Compensation for Distributed Energy Resources, recommends moving away from traditional big power and opting for smaller, targeted systems that could allow greater control at a lower cost.

“Built during the last century, the United States electric grid was primarily designed to transport electricity from large central-station power plants to end-use customers,” the paper explains. “DER (distributed energy resources), such as solar power, will play an important role providing power and grid services where they are needed most. To reach this goal, however, distribution grid planning must evolve to allow more transparency into system needs, enable more robust data exchange between utilities and DER providers, and include DER as a standard component of utility load forecasts.”

The report describes energy distribution as a constant balancing act that requires a great deal of planning. SEIA suggests grid designs be tailored by the state for a more perfect fit. The model would require more intense research and development to flesh out methods like time-of-use rates, locational values, and utility tariffs.

“When states develop fair compensation mechanisms for DER, the result is a modern electric grid that better serves the needs of all its customers,” said Sean Gallagher, SEIA’s vice president of state affairs. “The case studies highlighted in our report can serve as a model for other states interested in grid modernization and the economic benefits that result.”

The SEIA series will continue in the spring with a white paper on the key things a utility needs to do to efficiently upgrade and modernize.