 The proposed distributed energy management provides microgrids, utility-directly interface DIRS and responsive demands the opportunity of contributing to better network operational objectives while preserving their privacy and autonomy. This distributed energy management considers various ownership and privacy requirements of microgrids, utility-directly interface distributed energy resources, DIRS, and demand response and optimizes network operational objectives with constraints satisfied through iteratively updated price signals. The proposed distributed energy management is tested on a practical two microgrid system located in Ajuntas, Puerto Rico, and the applicability of the proposed strategy is validated through hardware in the loop, HL, testing. This article was authored by Guodong Liu, Maximiliano F. Ferrari, Thomas Bialas, and others.