DERMS Part III: Improving the Implementation Lifecycle

Ensure enterprise success using proven best practices

The power of distributed energy resource management systems (DERMS) has never been more relevant. Why? The global market for distributed energy generation is estimated at $383 billion in 2025, an increase of almost 15% in just one year.

DERMS emerged as a direct response to the increased proliferation of distributed energy resources (DERs) such as rooftop solar, wind turbines, battery storage and electric vehicles on the grid. DERMS supports the integration of renewables, helps optimize existing infrastructure and delivers cost savings. Ultimately, DERMS helps maintain a safe and resilient grid, while incorporating renewable energy, storage and flexible loads.

In two recently published Insights, TRC explored how DERMS delivers modern utility management and how to take the right approach to implementation. In Part III, we describe how to improve the implementation lifecycle, ensuring that every phase delivers customer-focused value, from planning to deployment and operations.

The Biggest Challenges for Energy Utilities Implementing DERMS

Traditional operational technology (OT) rollouts involve well-defined processes and replacing or upgrading existing assets and systems. DERMS is a new system with new processes, which creates the potential for mistakes that can lead to broad operational and organizational consequences.

One of the most persistent issues utilities face in implementing DERMS involves ensuring delivery to contract specifications. In large-scale DERMS projects, a disconnect often emerges between what was promised during procurement and what is ultimately implemented. This happens for many reasons, from evolving user requirements to organizational silos and integration complexities. Challenges when defining the solution can make it hard to fully deliver on expectations.

Without a robust process to track requirements, utilities implementing DERMS risk ending up with a system that falls short of business goals, which only becomes apparent late in the project lifecycle.

Another major challenge is the “you don’t know what you don’t know” phenomenon. DERMS is not a simple replacement of an existing tool; it’s a comprehensive technology solution that impacts multiple existing systems, datasets, stakeholders and processes.

Many utilities underestimate the learning curve and breadth of expertise required to anticipate integration challenges, operational impacts and future scaling needs. The further a project progresses without addressing these challenges, the more expensive and disruptive it becomes to correct mistakes. Inefficient requirements gathering or design missteps can ripple through production, resulting in costly rework, implementation delays and operational headaches.

An additional obstacle is maintaining alignment with business objectives during the evolving implementation phase. Early procurement and contracting teams often differ from those responsible for delivery and day-to-day operations. Hand-offs and long transition intervals can lead to miscommunication, outdated assumptions and a lack of shared understanding. Critical requirements may be overlooked or mistakenly deprioritized without continuous engagement and clear governance.

Finally, the extended timelines typical of DERMS projects can lead to issues. With projects lasting years and build cycles that may extend for 9-12 months or more, there is a risk that expectations will diverge between vendors and utility customers, and that features and functions implemented may stray from original objectives.

Successfully implementing DERMS is not for the unprepared. Key challenges  include:

• Ensuring quality delivery according to specification
• Navigating the dilemma of “you don’t know what you don’t know”
• Addressing integration complexity and achieving operational readiness
• Maintaining alignment between business objectives and implementation scope
• Managing miscommunication and other risks across long build cycles

Best Practices to Improve the DERMS Implementation Lifecycle

Addressing these challenges requires a disciplined, structured approach from the beginning and throughout the project implementation lifecycle. The following recommendations, grounded in industry best practices and TRC’s experience, help utilities maximize value, minimize risk and ensure lasting operational success for the enterprise.

1. Establish and Maintain a Robust Requirements Traceability Matrix (RTM)

   A well-constructed RTM is your single source of truth throughout the DERMS project lifecycle. Begin by capturing all functional and non-functional requirements during procurement and ensure that vendor and utility teams understand each requirement in the same way. As the project progresses, continuously update the RTM to reflect project status, design decisions and any contract adjustments.

   During design workshops, use the RTM to identify gaps and ensure that all requirements are addressed. In testing, map one or more test cases to each requirement, covering expected and unexpected scenarios. Requirements discipline ensures that nothing falls through the cracks and that the final system delivers what was promised.

2. Engage Stakeholders Continuously Across All Phases

   Stakeholder engagement is a process, not a one-time event. Involve all relevant groups early and often. Participants usually include grid operators, customer program managers, IT experts, system planners and regulatory affairs staff. To maximize productivity, conduct structured workshops with clear objectives, materials and agendas prepared in advance. Assign roles and responsibilities to frame the process and ensure resource commitments from leadership at every phase. Consistent, ongoing engagement helps surface evolving needs, incorporate lessons learned and maintain alignment with business objectives.

3. Insist on Incremental Delivery and Frequent Validation

   Given the long build cycles typical of DERMS projects, breaking the project into manageable increments is vital. Request regular demos or design mock-ups from the vendor, rather than waiting months for a “big bang” reveal. An incremental approach enables early detection of misalignments and keeps all parties focused on the end goal. Early feedback also reduces the risk of costly rework by validating assumptions and deliverables in real time.

4. Prepare Thoroughly for Integration and Operationalization

   Integration is often the most complex aspect of DERMS implementation. Begin planning for integration with internal and external systems, third-party aggregators and grid-edge devices from day one. Document technical architectures, data flows and operational processes early, and then validate them through stakeholder review and formal testing. Develop troubleshooting playbooks that identify key contacts and escalation paths for each integration point.

   Operational readiness should not be left until the end. Begin developing documentation, training materials and support processes as early as possible. Identify long lead-time items, such as new staffing needs and organizational changes, up front and incorporate them into the project schedule. By thinking about operationalization from the outset, you ensure a smoother transition to production and a more resilient support model.

5. Leverage External Expertise to Mitigate Unknowns

   No utility can anticipate every challenge, especially when implementing a system as complex and transformative as DERMS. Engage experienced partners like TRC early in the process to establish governance, structure and incorporate lessons learned from prior implementations. Experienced partners can help identify gaps, facilitate stakeholder alignment and ensure that best practices are embedded throughout the project lifecycle.

Achieve the Full Benefits of DERMS

By following these best practices, utilities can maximize their DERMS investment. The benefits extend well beyond those discussed in previous articles, touching every aspect of enterprise operations and grid management.

• Maximum value: Structured traceability and incremental delivery ensure that utilities maximize business value by having an ongoing focus and validation of business objectives.
• Reduced risk of costly rework: Early detection of gaps and misalignments minimizes the likelihood of expensive corrections late in the process, protecting budgets and timelines.
• Enhanced regulatory compliance: Continuous stakeholder engagement and robust documentation make it easier to demonstrate compliance with evolving regulatory requirements and secure necessary approvals.
• Operational agility: Proactive integration planning and operational readiness empower utilities to adapt quickly to changing grid conditions, new DER technologies and market opportunities.
• Stakeholder confidence: Transparent governance, regular progress updates and precise alignment with business goals build trust among internal teams, regulators and customers.