Renewable integration to the existing grid has potent to meet the epidemic energy demand, contributing to lowering of carbon footprints. The integration of these renewables especially at the distribution end has enhanced the network sustenance and has elevated the conventional grid toward smart grid. The amount of power that can be injected into the power system without violating the network parameters is termed as hosting capacity (HC) of the network. Thus, inclusion of additional renewable in the form of distributed energy resources (DERs) in the distribution side requires detailed HC assessment. But the uncertain nature of both the DERs and load causes HC governing parameters (voltage, ampacity, and total harmonic distortion [THD]) to waver with time. Due to these changing parameters, HC becomes indecisive, embarking the need of dynamic customary operational hosting capacity (DCOHC) assessment. Additionally, online change of the HC is also infrequent in conventional power injection control strategy. In this article, DCOHC assessment, improvement, and control for sustainable energy management are proposed through decentralization of controllers at the respective nodes, since these decentralized controllers are immune to data loss. Provision of controlling flexibility from utility control center (UCC) is also proposed to have a wide area monitoring and control facility leading to enhancement of situational awareness of the network. This strategy provides an innovative provision of online retuning of the governing parameters periodically based on necessary addition or removal of DERs, both from local controller and UCC level. Stipulation of maximum real‐time injection can be attained by maintaining governing parameters within anticipated strategic optimal operational HC (OOHC) region leading to most optimum usage of integrated DERs. The regulated operation of the controller is maintained with inclusion of considerable amount of additional DERs without adversely affecting the governing network parameters. Thus, maximizing the DCOHC of the network without compromising on the dynamic network parameters and performance of the power system in real‐time is extensively emphasized. To claim the efficacy of the aforesaid, a 5‐bus system, balanced reconfigured IEEE 33‐bus and unbalanced reconfigured IEEE 33‐bus distribution system is tested for DCOHC using MATLAB and real‐time Typhoon hardware‐in‐loop.