IEEE Power & Energy Magazine - May/June 2016 - 51

have occurred and how much DER capacity is available to serve connected loads
✔✔ procuring reliability capability and services from
third parties under the DSO, such as voltage support
or loading relief.
To maintain reliability with the help of a DSO despite the
high DER penetration, several T&D operational infrastructure enhancements are needed. For instance, there is a need
to gain visibility and monitor DER production on a real-time
basis sufficient for operational needs. That includes gaining
the ability to control DER power and var production for curtailment and voltage support, including the communications
and control infrastructure. New planning applications capabilities would be required to represent and analyze DERs.
Transmission networks were engineered to be operated as
ISOs/RTOs due to their high structural connectivity. However, distribution systems are highly dynamic and radial, and
thus the implementation of DSO operational functions is not
straightforward. One potential approach to operate the distribution system reliably through a DSO is with "partial feeders" or integrated microgrids on a preplanned or dynamic
basis that are intended to maximize the number of restored
customers for a variety of contingency conditions, locations,
and DER and load balance scenarios. For example, when a
fault occurs at the source of a feeder, DERs may provide
added reliability and continuity of service despite the lack
of grid power due to the DSO functions. The switching executed by the DSO will allow successful re-energization if
the DER capacity versus connected load is appropriate. To
be able to deploy such a service, additional switchgear and
protection/control equipment need to be installed.

Cost Benefits Analysis of a DSO
The penetration of DERs in Illinois is low; thus, efforts are
made to incentivize the deployment of DERs that will increase
the reliability and resiliency of the grid, and in some cases
the environmental benefits. The deployment of a proactive
DSO initiated by utility-owned DERs helps in the increase of
DER deployments. In particular, a proactive DSO will create
improved economics for DERs via a local market, which in
turn will can increase the adoption of DERs via investment by
customers. Increased DER investments will provide improved
T&D reliability for customers at better costs than immediate
investment in conventional T&D infrastructure. Increased
DER penetration might favorably improve wholesale market
costs with providing saving to all customers over time. Moreover, increased DER penetration and DSO local market services will facilitate renewables integration and penetration,
i.e., reducing wholesale costs associated with DER integration.
Since so many of the DSO benefits are indirectly attributed
to increased customer investment in DERs, a key element of
any cost-benefit analysis has to be how customer adoption and
investment is modeled over time.
Customer participation plays an important role in the successful DSO deployment. Therefore, opportunity costs that
may/june 2016

customers perceive for adopting or participating in programs
such as DR or managed electric vehicle charging need to
be quantified. The customer value of reliability is expressed
in terms of the cost of an outage and/or the cost of backup
generation and uninterruptable power supply technology to
avoid outages. Moreover, customer energy cost savings in
terms of demand charges need to be taken into account.

Final Thoughts
The DSO concept is still in the initial stages, and further development is required to determine the optimal solutions in terms
of DSO operational responsibilities and market models. The
goal of a DSO, through the grid and market functions, is to
empower customers' engagement and maintain reliability and
integrity of the grid given all the advancements in the distribution grid. Pilots can investigate many open questions and play a
significant role in the successful deployment of DSOs. Various
approaches described in this article may be used in the development of the DSO models where the appropriateness of each
model may be judged based on the specific situation. In all
cases, however, DSOs will be developed as an operating model
that represents a viable solution to increase customer engagement and maintain the grid reliability and security.

For Further Reading
J. Durkay. (2014, Sept.). Net metering: Policy overview and
state legislative updates. [Online]. Available: http://www.
ncsl.org/research/energy/net-metering-policy-overview-andstate-legislative-updates.aspx
P. Sandoy, et al. "The role of distribution system operators (DSOs) as information hubs," in Proc. EURELECTRIC
Networks Committee, June 2010, pp. 1-23.
M. J. N. van Werven and M. J. J. Scheepers, "The changing role of distribution system operators in liberalised and
decentralising electricity markets," in Proc. Int. Conf. Future Power Systems, Nov. 2005, pp. 1-6.
P. De Martini, L. Kristov, and L. Schwartz, "Distribution
systems in a high distributed energy resources future planning, market design, operation and oversight," Lawrence
Berkeley National Lab., Rep. 2, Oct. 2015.
E. A. Paaso, J. E. Svachula, and S. Bahramirad, "Planning and operations of the utility of the future in Illinois,"
Electr. J., vol. 28, no. 10, pp. 18-28, Dec. 2015.
X. Lu, S. Bahramirad, J. Wang, and C. Chen, "Bronzeville
community microgrids: A reliable, resilient and sustainable
solution for integrated energy management with distribution
systems," Electr. J., vol. 28, no. 10, pp. 29-42, Dec. 2015.

Biographies
Dimitra Apostolopoulou is with Commonwealth Edison,
Oakbrook Terrace, Illinois.
Shay Bahramirad is with Commonwealth Edison, Oakbrook Terrace, Illinois.
Amin Khodaei is with the University of Denver,
p&e
Colorado.
ieee power & energy magazine

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