The journey to monetizing distributed energy resources | Catalyst with Shayle Kann

FERC Order 2222

FERC Order 2222 marks a significant shift in the participation of distributed energy resources (DERs) in electricity markets. Shayle Kann explains that this order mandates all organized wholesale markets to create rules allowing DER aggregations to participate, a move that was previously inconsistent across regions 1. Mathew Sachs highlights the progress made since the order, noting that while some regions like New York and California have approved proposals, others are still pending 2.

The order originally basically said, all ISOs and RTOs, every organized wholesale market must introduce rules to allow aggregations of distributed energy resources to participate.

--- Shayle Kann

He emphasizes the importance of heterogeneous aggregations, which allow diverse resources to be combined, enhancing their value in the market 2.

   

Market Challenges

Adapting current market rules for DERs presents significant challenges. Mathew Sachs discusses the complexity of integrating DERs into a market designed for centralized assets, likening it to a game of "whack-a-mole" due to unpredictable pricing and value streams 3. He notes that while technology investments are helping to optimize these processes, the market's current structure still poses barriers 3.

It's not always clear where the next value is going to come from.

--- Mathew Sachs

Shayle Kann adds that the coordination required among stakeholders, including utilities and regulators, is a major hurdle in streamlining DER integration 4.