The Limits of DERs and the Future of Renewable Power

Articles in discussion:

Households transforming the grid: Distributed energy resources are key to affordable clean power - Deloitte

Updating our grid is the key to a clean energy future - Bill Gates

If you look back in human history, the scientific advancements made in the last 100 years clearly outshine those made in the countless centuries preceding that time frame. One technological phenomenon that has gained traction in the last half-century, especially in the recent decade, is renewable energy.

With climate change unleashing its full force due to our excessive production of carbon emissions, the need for cleaner alternative energy sources has bolstered research, development, and implementation. In recent years, localized solar power generators (panels) have sprouted in houses, and the rise in smart electric vehicles has created fierce competition in their respective markets.

It is a well-known fact that the environmental cost from manufacturing the material for renewable energy power generation is much lower and more manageable than that produced by fossil fuels. However, there is a key barrier preventing us from developing and deploying large-scale power grids: the delivery of power to our homes. Power delivery efficiency depends highly on the power lines that transmit it; the longer the distance, the larger the voltage drop (this is considering classical power lines - I'm aware there are smarter grids out there that already exist or are being developed).

The challenge with renewable energy generation, especially for solar (the easiest to harness and implement out of the renewable energy sources), is that it is highly dependent on weather patterns and sunlight, and efficiency can drop under extreme heat. This means that, as the TED-ED video above mentions, we cannot simply deploy large-scale solar panel fields in regions such as the Sahara or Las Vegas because the excessive heat can damage the currently available PV panel technologies we use at a commercial scale. Additionally, the video indicates that our power transmission lines are not well-suited to deliver high-voltage solar-generated energy over long distances, which limits both generation and delivery capabilities for solar energy.

Given this issue, solar power generation has become most practical as a localized source of energy. Many houses now have their own solar panel systems, and if you have ever visited the Tesla website, you have likely seen their diagram showing solar PV panels providing energy during the day and a storage system powering both your house and your Tesla at night. These are what are commonly known as Distributed Energy Resources (DER). Many people who implement them see the value primarily in saving on their monthly electricity bills, although environmental motivations are a factor as well.

There are both advantages and disadvantages to DERs. The advantages are that they are accessible, they do not require connection to a centralized grid, and they can be placed almost anywhere with sufficient sunlight. The disadvantages are that they remain expensive, they are difficult to scale into centralized systems, and they still rely on lithium or similar mineral-based batteries to store energy.

Lithium batteries are not necessarily a dealbreaker, but they raise concerns when discussing the goal of creating a clean energy-based society. The mining and processing required for these batteries can lead to significant pollution and deforestation, which is a serious environmental tradeoff (this is a discussion for another day, or privately over email). Clearly, solar energy offers immense potential in our transition to clean energy, but at the moment, it is often inaccessible in regions that could benefit from it the most. DERs may hold the greatest promise for remote or underserved communities without access to reliable power grids, yet they are more commonly adopted by households pursuing tax incentives or cost savings. This dynamic, while beneficial for individual adopters, complicates the broader purpose of DERs. If mass adoption is concentrated in higher-income households, it could create economic distortions. System prices could rise, utilities might adjust supply to demand by maintaining or raising prices, and households that cannot afford DERs could be left behind.

Bill Gates’ article highlights the importance of targeted research and development. Instead of focusing primarily on expanding DERs, technological upgrades are required for our power transmission lines. Without these upgrades, the clean energy transition risks turning into a “power-your-home-independently” niche market, where commercialization and mass adoption remain limited. Gates also notes that infrastructure planning is essential for new and enhanced transmission systems. The challenge is that the United States is highly diverse in terms of urban layouts, building codes, and zoning. Having worked in construction in the New York City area, I can tell you firsthand that it can take years to acquire permitting and zoning approvals from the NYC Department of Buildings, while in cities like Houston, the process can be completed in a matter of weeks. Now, imagine implementing new and smarter transmission lines at the national scale; it could take decades.

Although this may sound discouraging, there are reasons for optimism. A coordinated effort among government, the private sector, and experts from academia and public policy could create the foundation for a real transition to renewable energy. How would this work? My proposal is that the government streamline permitting, zoning, and infrastructure approvals, while experts ensure that projects do not compromise environmental safety or public health. Private sector partners would require financial incentives to take on projects of this magnitude. Infrastructure companies would need relief from high surety bond requirements, as projects of this scale are unlikely to remain on schedule, attributed to dynamic approval timelines. Energy companies would require tax credits to develop renewable power plants at scale, with strict oversight to ensure that credits are tied to real renewable production and quality standards. Fossil fuel companies are unlikely to pivot significantly without financial incentives, and utility companies would need support to temporarily reduce rates for renewable-supplied energy to encourage demand growth. This must be managed carefully to avoid destabilizing energy markets while gradually phasing out fossil fuel-based production.

This is a lot to process, but it represents a theoretical, high-level framework for planning a renewable energy transition at scale. Importantly, this discussion has focused mostly on solar, but there are other renewable methods, including geothermal, biomass, hydropower, and wind. Some, like biomass, can even harness human waste or unfertile land to generate energy. Adding these to the mix could accelerate the timeline significantly.

The subject of renewable energy is not simply about producing more energy or expanding markets, but about survival. If we do not approach this transition with seriousness and long-term commitment, the outlook for humanity becomes increasingly fragile. To improve our odds of thriving over the next century, we need to treat this as a generational project. The goal is not just to revamp our current systems, but to ensure that future generations live in a world where heat waves are not existential threats, clean water is abundant, and agriculture is resilient.

Disclaimer: The reflections shared here are my own technical and analytical perspectives. They are not definitive statements of fact or policy positions. I welcome thoughtful discussion; feel free to contact me if you’d like to explore these ideas further.