Our electric grid is facing unprecedented stress from skyrocketing demand and increasingly intermittent supply. Fortunately, distributed energy resources (DERs), such as rooftop solar panels, home batteries, EV chargers, and more, offer exactly what the grid needs: flexible, clean, and low-cost capacity.
What’s Happening with the Grid?
On the demand side, grid operators are preparing for unprecedented load growth. As shown below, peak demand forecasts are exploding – US demand is expected to increase ~16% by 2029. Over half of this spike is just from data centers for AI. Demand growth is further buoyed by IRA-motivated return of (electrified!) US manufacturing, expansion of hydrogen hubs, and consumer adoption of electric vehicles and heating.
Source: Grid Strategies, December 2024.
On the supply side, the cheapest way to build new electricity generation today is from wind and solar – a climate milestone which should be celebrated in its own right. However, these renewable resources are variable, providing real challenges when the wind does not blow and the sun does not shine. This variability is further compounded by increases in variable demand as more loads can turn on and off rapidly (e.g., EVs, heat pumps). Also, cumbersome centrally-planned transmission infrastructure means that it is nearly impossible to build new transmission in the United States even when and where it does makes sense.
So the grid has to serve increasingly ambitious load targets every year, while doing so with a generation fleet that is increasingly intermittent and facing structural challenges to growth.
Enter DERs
More than ever, folks are adopting DERs. And the reasons for doing so are wide ranging. Some people install rooftop solar to save money. Others are adding home batteries to be prepared for grid outages. Many folks buy electric vehicles simply because they are great cars. People love smart thermostats since they make it easy to keep the whole house comfortable. No matter the reason, these devices are expected to only grow in popularity. And with more DERs, comes more opportunities.
Source: Derapi DER growth projections informed by analyses from SEIA, Wood Mackenzie, NREL, BNEF, Edison Electric Institute, RMI, and US DOE.
Companies are rapidly innovating to find ways to maximize the value of these devices. The most prevalent application is Virtual Power Plants (VPPs), where companies aggregate many distributed devices to provide the same grid value as an actual power plant. Not only do these resources provide the grid with clean and flexible electricity, but they do so at a considerably lower cost (40-60% the cost of traditional power plants). Other companies are tapping into DERs to provide better energy management systems, or finding the most favorable financing options, or improved operations and maintenance of the devices. As DERs become entrenched in homes everywhere, there will be even more innovation to get the most out of these devices.
Not only are there more DERs being adopted than ever before, but there are more manufacturers making these devices than ever before. If you wanted a home battery just a few years ago, there were really only one or two options. Today, there are over twenty, with more popping up each year. This is true across DER types with dozens of EV charger manufacturers, heat pump brands, and electric water heaters having recently entered the market and even more preparing to do so.
DER Bottleneck & Derapi Solution
While both trends may seem to poise the DER market for success – more ways to get value from DERs, more DER options to get value from – they do combine to create one massive bottleneck: DER integrations.
For these companies to actually get value from DERs, they need to be able to integrate with the devices to communicate with them. And these integrations are a pain. For one company to integrate with one device manufacturer, it can take weeks or even months of dedicated engineering time. Each device manufacturer has its own application programming interface (API) for communication with its devices, which requires engineers to get intimately familiar with the details of each integration, then do all of the required testing, data processing, and monitoring to keep the integration viable.
Because these integrations are so difficult, companies are forced to choose which customer’s devices they will support and which they cannot, leading to industry full of patch work solutions.
This problem is exactly why we created Derapi. Our team has spent our entire careers in this industry, frustrated by stifled progress and innovation from a problem we know we can fix. With Derapi’s universal API, companies just need to integrate to Derapi’s API once to get access to all the devices from manufacturers we partner with. Rather than managing dozens of bespoke integrations, companies can use Derapi to have one, simple, and reliable point of connection.
Our team is comprised of experts in DER integrations. We have leveraged our experience to create the most trusted and reliable communication pathways for DERs, providing the platform for companies to innovate and maximize their value.
If you are working with DERs – either manufacturing them or creating products for them – we would love to talk. Feel free to reach out to: info@derapi.com