The distributed energy revolution isn’t coming. It’s here.

From rooftop solar and electric vehicles to smart thermostats and battery storage, Distributed Energy Resources (DERs) are now a permanent part of the energy and utilities landscape. For utilities, this brings both disruption and opportunity. But capitalizing on DERs requires more than reactive patchwork—it demands an enterprise-grade DERMS (Distributed Energy Resource Management System) strategy.

The question isn’t if utilities should evolve—it’s how fast they can.

Here are some questions that plague utilities as they think about their upgrade path:

• Why are utilities shifting toward enterprise-grade DERMS platforms?
  What key capabilities are driving this transformation?
• What approaches are utilities taking to build DERMS capabilities?
  Extend, buy, or build—which path makes the most sense?
• What capabilities are available in today’s market across vendors and solutions?
  Are current offerings truly end-to-end?
• Which peripheral IT systems are critical to operationalize DERMS at scale?
  How important are data, integration, and cloud infrastructure?
• What are the biggest challenges utilities face in building and scaling DERMS?
  Platform maturity, integration complexity, cybersecurity?

From Control to Orchestration: A New Mandate for DERMS

Traditionally, DERMS platforms were built for control—turning DERs on or off, ensuring reliability, managing localized events. But today’s grid is more dynamic, more distributed, and more data-intensive.

Now, utilities need platforms that can:

• Predict and respond to grid conditions in real time
• Optimize DER operations across the network
• Orchestrate assets at scale while balancing grid reliability and customer flexibility

This requires a major shift—from siloed systems to deeply integrated, intelligent platforms that act as a digital backbone across the utility enterprise.

Enterprise DERMS vs. Standalone Solutions

Let’s define the difference:

Enterprise DERMS isn’t just a tool—it’s an ecosystem.

It connects critical utility systems, from billing and metering to customer engagement and forecasting. Think of it as the central nervous system that enables unified DER planning, control, and monetization.

How Are Utilities Building DERMS Capabilities?

Across the industry, three distinct strategies are emerging:

1. Extend the ADMS
   Utilities build on existing Advanced Distribution Management Systems by adding DERMS features.
   • Tight grid integration
   • Risk of vendor lock-in, limited flexibility
2. Buy & Integrate
   Utilities purchase best-of-breed DERMS platforms and integrate them with IT/OT systems.
   • Cloud-native, SaaS, AI-capable
   • High integration effort
3. Build Custom Platforms
   Some utilities build DERMS solutions in-house, tailored to local needs and business objectives.
   • High scalability and control
   • Demands internal expertise and development cycles

There’s no universal playbook. The best path forward depends on existing infrastructure, regulatory context, and organizational agility. But across all strategies, one constant remains: integration is non-negotiable.

What Defines an Enterprise-Grade DERMS?

To meet the demands of a decentralized grid, enterprise DERMS platforms must deliver core capabilities like:

1. Program design & enrollment
2. Asset onboarding and validation
3. Event notification and execution
4. Scheduling & dispatch
5. Metering, reconciliation & settlement
6. Real-time analytics & reporting
7. Market and event participation

But beyond these, a true enterprise DERMS must also serve as a digital bridge—connecting the dots between customers, operations, and the grid.

The Hard Truth: It’s Harder Than It Sounds

Despite the promise, DERMS implementation is anything but easy. Here’s why:

Platform Maturity & Selection

• Despite maturity, current DERMS platforms struggle to cover the full value chain
• The landscape is fragmented, with evolving regulatory and business requirements
• Platforms need to be modular, open, and adaptable

Fragmentation of Point Solutions

• Utilities often deploy separate tools for EVs, thermostats, energy storage, etc.
• This leads to operational silos, redundant data, and inefficiencies

Integration & Interoperability

• DERMS must communicate with field devices, control systems, customer platforms, and markets
• Without seamless interoperability, grid flexibility is compromised

Cybersecurity

• A decentralized grid creates a broader attack surface
• Utilities must embed security across IT, OT, and third-party systems

The Supporting Cast: What Makes DERMS Truly Operational

DERMS cannot operate in isolation. A future-ready solution demands critical supporting technologies:

• AI & Advanced Analytics: For real-time forecasting, optimization, and situational awareness
• OT Message Bus: For seamless communication across DERs and utility control systems
• Customer Experience Platforms: To onboard and engage prosumers, aggregators, and partners
• Market Management Systems: To support transactive energy and monetize flexibility
• Cloud-based Scalable Historian: For managing high-frequency time-series data
• End-to-End Cybersecurity: Integrated across data layers, devices, and platforms

DERMS is not just an operational platform—it’s the anchor of digital transformation across the utility enterprise.

So, Should You Buy, Build, or Extend?

There’s no one-size-fits-all answer. Some utilities will extend their ADMS. Others will buy cloud-native solutions. A few will build for control. The right strategy depends on one critical principle: choose flexibility. A future-proof DERMS architecture must be open, modular, secure, and capable of evolving with the grid and market dynamics.

Final Word: DERMS is a Strategic Imperative

This isn’t just another software upgrade. DERMS is a defining transformation—one that will determine how utilities navigate the energy transition, manage complexity, and create value from every kilowatt on the grid. The utilities that get it right will lead the charge with intelligence, agility, and resilience.

DERMS is not a point solution—it’s the platform powering the future of distributed, digital energy. The time to modernize is now.