Distributed Energy Reseources (DER) equipment costs follow a traditional learning curve. Depending on the maturity of the different DER technologies, it is still necessary to reduce manufacturing costs further and to increase energy conversion efficiencies. Public support aims to alleviate the high initial costs incurred at the beginning of such learning curves.
DER development within the distribution network (i.e. medium and low voltage networks) can follow two complementary routes:


  • Initially “passive” integration of DER units is expected. Distribution networks are still based on the “fit and forget” principle: DER units are allowed to operate on their own, as long as the impact on network operation remains limited once connected.
  • In a second step, “active” integration of DER is required. This assumes metering, telecommunication and, last but not least, remote control.

The 20-20-20 objectives increase the interest in active management concepts, which should be assessed on a case-by-case basis as they are essentially network-dependent. The transition from “passive” to “active” integration requires technical developments that will impact on both existing and newly-introduced DER, to be started now.


  • What are the new services that can be delivered with today’s DER technologies when they are integrated?
  • What is the hosting capacity of today’s electrical system and when will active management become mandatory?
  • What are the critical technologies and standards for smoothing the transition from passive to active grid control?
  • What could a rational generating cost target be?


EU-DEEP has tested integrated DER systems, optimising energy management at consumer level and enabling new functionalities and services

Today’s DER controllers and Energy Management Systems, based on present technologies, already allow the complete integration of DER into a single system. Two one-year experiments showed that additional integration costs for innovative control strategies represent around 10% of the total DER installation cost (for DER unit size of around 100  kW), a level that is acceptable for some business models.

On the basis of one year aggregation experiments, EU-DEEP enabled to upgrade today’s DER simulation software and control technologies to run an innovative aggregation business

Local DER controllers and central Aggregator technologies - connected via e.g. GPRS based telecommunication – allow the setup of aggregation systems up to a significant number of aggregated sites based on today’s ICT technology (e.g. 200 sites).
To include a larger number of (smaller sized) sites, standardisation of interfaces, parallelisation and/or stochastic control with hierarchical Information & Communication technology (ICT) system infrastructures (or local agent based ICT solutions) will be necessary, possibly re-using existing or upcoming telecommunication infrastructure.
The cost/benefit analysis performed within the three tested business models of aggregation defined the target costs for DER and ICT equipment with respect to today’s market environments.

A large amount of DER can be “hosted” by today’s system, but integration of DER is mandatory in the long run

In-depth analysis of the technical impact of DER on the different layers of the system proved that margins exist in today’s distribution network, particularly if Distributed Generation (DG) unit size is below the design criteria. For instance 1 kW micro Combined Heat & Power (CHP) are more easily “hosted” by the network than 5 kW Photovoltaic (PV). Two complementary steps are needed to go beyond the current hosting capacity of the network. The first is based on active management within present design criteria and the second one requires upgraded network design. The technical analysis also showed that DER must be integrated for preserving system integrity. In a first step, this integration can be “passive”: the system operator should have to keep a register of DG. In a second step, in particular when the network relies on DG as a “network replacement, an active integration will be required: DER will need to be controlled during specific system conditions.

EU-DEEP recommends the development of standards, especially related to communication, smart metering, network integration and grid connections to facilitate interoperability and foster DER integration at a lower cost

Several technologies play a key role in the integration of DER into the system, especially smart metering and ICT to monitor and improve the control of selected distribution network areas. Component technologies to ensure active control of distribution networks should be further developed. The EU-DEEP project specifically addressed energy management challenges, via aggregation techniques of multiple units through energy management systems or dispatch technologies of active power outputs from multiple DER units. Recommendations have been made to standardisation bodies to work on:


  • overall communication standards and protocols for seamless exchange of data (continuation of TC57 work on interoperability and worldwide marketing of the developed standard series);
  • smart metering requirements (a harmonised smart meter standard in Europe and its extension to international level via IEC);
  • coordination at European level when dealing with DER integration into electric networks;
  • common requirements and grid connection procedures.

The MV or LV retailing price of electricity is not necessarily the target for DER generation costs

The economic value of DER units for the system and for the network depends on the technology, the way it is used, the system & network specificities, and the regulatory environment. An important aspect concerns the value of DG as a “network replacement”. The eligibility of a particular DER to this value leads to different target generation costs. For example the value of PV for the network can be high in a network where peak demand is due to air conditioning (often running when PV is operating). On the contrary this value can be low, even negative in a system where PV generates during summer and peak consumption takes place in winter. In this latter case, the targeted generating costs for PV could be significantly lower than the retail price, transmission and distribution tariffs included.

EU-DEEP recommends large-scale demonstrations as a next step to industrialising the solutions developed

EU-DEEP proposes demonstration experiments in urban and rural grids to prove the scalability and reliability of technical/market/regulation solutions proposed by the project. The Third International Conference on DER and RES integration organised in 2008 by the EU-DEEP project outlined the convergence between the North American, Japanese and European experiences for RES and DER integration and the urgency to industrialise the corresponding solutions.


Challenges not covered by EU-DEEP

• How to decrease the DER production costs?
• What are the detailed technical solutions for an active management of distribution networks?
• What are the minimum common requirements for smart metering architectures in Europe?
• What will be the new communication standards and protocols for data exchange among network operators?

Expand results



select another stakeholder