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The global demand for Distributed Energy Resource Management Systems (DERMS) is experiencing rapid growth, driven by an increasing need for energy, particularly from renewable sources. Projections indicate a substantial expansion in the global DERMS market, with an estimated Compound Annual Growth Rate (CAGR) of 15.46% during the forecast period spanning 2019 to 2025. In 2018, North America took the lead in the global DERMS market, claiming a dominant share of 38.17%, followed by Europe at 32.67%, and Asia-Pacific at 20.56%.
The segmentation of the global DERMS market is based on technology, software, end-use, and region. In terms of technology, the market is divided into solar PV, energy storage, wind, combined heat & power, and others. Among these, the wind segment is anticipated to exhibit the fastest growth during the forecast period. In 2018, the solar PV segment held a significant share of 27.24% in the global DERMS market.
The software segment includes analytics, management & control, and virtual power plants. Among these, the analytics segment is poised for the fastest growth during the forecast period. In 2018, virtual power plants held a substantial share of 31.87% in the global DERMS market.
In the end-use category, the market is segmented into industrial, commercial, residential, government & municipalities, and military. The commercial segment is expected to experience the fastest growth during the forecast period. In 2018, the industrial segment led with a share of 38.63% in the global DERMS market.
These trends underscore the diverse applications and growing significance of DERMS across various technologies, software functionalities, and end-user sectors. The increasing emphasis on renewable energy sources is a pivotal factor propelling the demand for DERMS globally. As industries, commercial entities, and governments seek effective management and optimization of distributed energy resources, DERMS is emerging as a crucial solution to meet these evolving needs.
This robust growth in the DERMS market signifies a shift towards more sustainable and efficient energy management practices. As the market continues to evolve, the dynamics of technology adoption, software integration, and diverse end-user requirements are expected to shape the trajectory of the global DERMS industry.
Covered Aspects:
| Report Attribute/Metric | Details |
|---|---|
| Market Size Value In 2022 | USD 0.59 Billion |
| Growth Rate | 16.48% (2022-2030) |
Distributed Energy Resource Management Market Highlights:
Global Distributed Energy Resource Management Market Overview:
Distributed Energy Resource Management Market Size was valued at USD 0.73 billion in 2023. The Distributed Energy Resource Management market industry is projected to grow from USD 0.84 billion in 2024 to USD 1.80 billion by 2032, exhibiting a compound annual growth rate (CAGR) of 10.53% during the forecast period (2024 - 2032).
The increasing number of distributed energy resources, and shift from centralized to distributed generation, and the declining cost of solar PV & energy storage are expected to drive the Distributed Energy Resource Management System market.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Distributed Energy Resource Management Market Trends
- Smart Grid Deployment Efforts by Governments to boost market growth
Governments of various nations worldwide have mandated smart grid installation, making them critical to national energy policies. Energy policies of countries have been focusing on improving efficiency and carbon emission reduction. Governments have increasingly invested in smart grids to accelerate the replacement of aging grid structures. In November 2021, the United States Government passed a new infrastructure investment and jobs act.
According to the act, a huge investment in smart grid development is being made. The law includes a USD 3 million investment for Smart Grid Investment Matching Grant Program. The rising smart grid deployments further the demand for distributed energy resource management software and systems for smooth functioning and remote control of the grids.
Additionally, the growing responsibility to protect the environment by sustainable development is fueling electric vehicle adoption globally. The International Energy Agency (IEA) reports that nearly 2.1 million more electric cars were sold globally in 2019 compared to the previous year, recording a 40% y-o-y growth. With the development of technology, the cost of electric vehicles has been reducing over the years, further propelling their demand.
Various nations have promoted electric vehicles and developed suitable policies to accelerate the shift towards zero-emission vehicles. Pollution control mandates and fuel economy standards drive the EV market.
In July 2021, the Government of Maharashtra announced a Maharashtra EV Policy 2021, providing ₹ 5000/kWh of battery to ramp up EV sales. Furthermore, in October 2021, Tata Power announced having set up over 1000 EV charging stations across India. With the rise in EVs and a further increase in EV charging stations, the demand for energy management systems is expected to grow, driving the market.
Distributed Energy Resource Management Market Segment Insights:
Distributed Energy Resource Management Technology Insights
Based on technology, The Distributed Energy Resource Management Market segmentation, includes Solar PV, Energy Storage, Wind, and CHP. Distributed Energy Resource Management System is utilized for controlling and optimizing the functionalities in solar energy generation. The broad penetration rate of the DERMS in the solar sector, along with massive utilization in rooftop solar, bolsters the segment growth.
Distributed energy resource management is also integrated with energy storage functionalities. The energy generated needs to be stored in batteries. The proper charging and discharging cycles of these batteries and their timely maintenance employ distributed energy resource management software. Distributed energy resource management can be used for wind power generation control and management and EV charging station control and maintenance.
The others segment accounts for combined heat and power (CHP) applications and demand in response management.
Distributed Energy Resource Management Software Insights
Based on Software, the Distributed Energy Resource Management Market segmentation includes Analytics, Management & Control, and VPP. The virtual power plant uses cloud-based real time operational control to aggregate capacities of different distributed energy resources DERs to enhance efficiency and trade power. The wide range of functionalities of a VPP makes it a desirable choice for most consumers.
Management and control software help in remote handling of the distributed energy resource to smoothly control the operations and detect failures and necessary maintenance measures. Analytics tools and software help planners determine various parameters by incorporating large data sets to enhance efficiency and utilize visual data sets.
Distributed Energy Resource Management End-User Insights
Based on End-User, the Distributed Energy Resource Management Market segmentation includes Government & Municipalities, Industrial, and Commercial. The industrial & utilities segment is the leading segment due to the high penetration of the Distributed Energy Resource Management System, especially virtual power plant software, for enhancing efficiency and facilitating smooth energy trade. Moreover, distributed energy is highly produced by industries and utilities, further propelling the segment growth.
The residential and commercial segment refers to distributed energy resource management smaller than utilities and industries. However, the massive growth of rooftop solar PV adoption in residential end-users propels the segment. Residential and commercial end-users generally use management & control and analytics software for smooth operation and optimization.
Figure 2: Distributed Energy Resource Management Market, by Distribution Channels, 2021 & 2032 (USD Million)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
Distributed Energy Resource Management Regional Insights
By region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The Asia Pacific is the largest market for distributed energy resource management systems and accounted for USD 0.12 billion in 2020. The growth in power generation using solar and wind and the growing energy requirement due to industrialization across the Asia Pacific drives the market.
According to the Census and Economic Information Centre (CEIC), China's industrial production index growth rate rose to 3.1% year-on-year in September 2021. The country recorded a 14.1% industrial production index growth rate year-on-year in March 2021. China commenced developing its 10 GW solar and wind power project in November 2021 and is anticipated to be a significant aid in achieving net-zero goals. The increased investment in renewable energy projects in the region massively propels the market.
Figure 3: Distributed Energy Resource Management Market Share By Region 2021 (%)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
In North America, the U.S. holds a significant distributed energy resource management market. The United States has pledged net zero emissions by 2050. The federal government rapidly invests in renewable energy projects to achieve this sustainable goal.
A new offshore wind energy project called the 'Kitty Hawk' is anticipated to be developed by 2023 near the Outer Banks, off Virginia and North Carolina coasts. This project is expected to add 2,500 MW to the offshore wind energy capacity of the country. Such projects are anticipated to drive the market.
The European renewable energy industry is central to the region's economic development. European countries have massively invested in green and clean energies. The region has many offshore wind facilities and solar farms. Germany, France, Italy, Spain, the United Kingdom, and the Netherlands are a few countries that have invested in solar and wind energy capacities.
According to International Renewable Energy Agency (IRENA), Europe has 162,429 MW of solar PV and 183,675 MW of wind power. The continuously increasing government efforts towards clean energy goals drive the demand for distributed energy resource management.
Distributed Energy Resource Management Key Market Players & Competitive Insights
Major market players are spending a lot of money on R&D to increase their product lines, which will help the Distributed Energy Resource Management market grow even more. Market participants are also taking a range of strategic initiatives to grow their worldwide footprint, with key market developments such as new product launches, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations.
Competitors in the Distributed Energy Resource Management industry must offer cost-effective items to expand and survive in an increasingly competitive and rising market environment.
The major market players are investing a lot of money in R&D to expand their product lines, which will spur further market growth for Distributed Energy Resource Management. With significant market development like new product releases, contractual agreements, mergers and acquisitions, increased investments, and collaboration with other organizations, market participants are also undertaking various strategic activities to expand their global presence.
To grow and thrive in a market climate that is becoming more competitive and growing, competitors in the Distributed Energy Resource Management industry must offer affordable products.
Manufacturing locally to cut operating costs is one of the main business tactics manufacturers use in the global Distributed Energy Resource Management industry to benefit customers and expand the market sector. The Distributed Energy Resource Management market has recently given medicine some of the most important advantages. Major hair care product market players, including Hitachi ABB, Siemens, General Electric, Engie, Itron, Oracle, Generac, Energy Hub, Mitsubishi Electric Corporation, and AutoGrid Systems
EPRI, GE to develop distributed energy resource management system The Electric Power Research Institute (EPRI), along with Schneider Electric, General Electric, and Smarter Grid Solutions, received a $2.2 million award to develop a distributed energy resource management system (DERMS) to mitigate potential issues caused by integrating distributed energy resources (DER) with the electric grid.
The New York State Energy Research and Development Authority (NYSERDA) awarded the funding through its Smart Grid Innovation program, as part of New York State’s overall strategy to achieve Governor Cuomo’s goal of a zero emission electricity sector by 2040. The project includes a pilot program deployed with Central Hudson Gas & Electric to develop and demonstrate a scalable system that enables a large quantity of DER to be integrated into transmission and distribution systems.
Also, India has an ambitious plan of generating 280 GW of sun-fired electricity by 2030 and outlined plans to spend an additional INR 19,500 crore to boost local manufacturing of solar modules. In the United States, solar PV investments rose significantly, supported by corporate procurement.
List of the Key Companies in the Distributed Energy Resource Management market includes
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Hitachi ABB (Switzerland)
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Siemens (Germany)
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General Electric (U.S.)
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Engie (France)
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Itron (U.S.)
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Oracle (U.S.)
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Generac (U.S.)
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Energy Hub (U.S.)
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Mitsubishi Electric Corporation (Japan)
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AutoGrid Systems (U.S.)
Distributed Energy Resource Management Industry Developments
November 2021 – Hitachi Energy launched the improved PowerStore battery energy storage system (BESS) products. It is the first update to the distributed energy solutions portfolio since Hitachi ABB Power Grids converted to Hitachi Energy.
June 2021 – Itron Inc. deployed a grid-interactive water heater program for Fort Collins Utilities in Colorado. The program enables distributed energy resource management for combined heat and power (CHP) applications.
Distributed Energy Resource Management Market Segmentation
Distributed Energy Resource Management Technology Outlook
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Solar PV
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Energy Storage
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Wind
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CHP
Distributed Energy Resource Management Software Channel Outlook
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Analytics
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Management & Control
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VPP
Distributed Energy Resource Management End-user Channel Outlook
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Government & Municipalities
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Industrial
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Commercial
Distributed Energy Resource Management Regional Outlook
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North America
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US
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Canada
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Europe
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Germany
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France
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UK
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Italy
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Spain
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Rest of Europe
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Asia-Pacific
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China
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Japan
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India
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Australia
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South Korea
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Australia
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Rest of Asia-Pacific
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Rest of the World
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Middle East
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Africa
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Latin America
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