​​​Across the U.S., consumers are increasingly adopting distributed energy resources (DERs), such as rooftop solar, energy storage, electric vehicles (EVs), smart thermostats, grid-connected HVAC systems, and other controllable loads. This growth has spurred third-party vendors to develop software to help utilities aggregate and control these devices, both in front of and behind the meter, to provide ancillary grid services.

Distributed Energy Resource Management Systems, or DERMS, is an emerging software technology that can provide the ability for utilities to monitor, manage, and control DERs — and fully integrate them into grid operations. A DERMS connects with DERs and combines them into virtual power plants (VPPs) — aggregations of hundreds or thousands of flexible resources located at homes and businesses. A utility, grid operator, or aggregator can use a DERMS to direct VPPs to provide various beneficial services for utility customers, distribution and transmission grids, and wholesale electricity markets.

This report presents the results of a 2023 NRECA survey of 37 electric cooperatives, with a focus on their DERMS/VPP pilots and programs, motivations, level of deployment, challenges, gaps in capabilities, and other topics. It also explores how cooperatives are evaluating and implementing these technologies, key questions and concerns, and an outlook on future cooperative trends. It describes three detailed cooperative case studies. Finally, it provides guidance on how cooperatives can determine whether DERMS and VPPs are suitable investments for their needs and circumstances.