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Title: Valuation of Electric Power System Services and Technologies

Abstract

Accurate valuation of existing and new technologies and grid services has been recognized to be important to stimulate investment in grid modernization. Clear, transparent, and accepted methods for estimating the total value (i.e., total benefits minus cost) of grid technologies and services are necessary for decision makers to make informed decisions. This applies to home owners interested in distributed energy technologies, as well as to service providers offering new demand response services, and utility executives evaluating best investment strategies to meet their service obligation. However, current valuation methods lack consistency, methodological rigor, and often the capabilities to identify and quantify multiple benefits of grid assets or new and innovative services. Distributed grid assets often have multiple benefits that are difficult to quantify because of the locational context in which they operate. The value is temporally, operationally, and spatially specific. It varies widely by distribution systems, transmission network topology, and the composition of the generation mix. The Electric Power Research Institute (EPRI) recently established a benefit-cost framework that proposes a process for estimating multiple benefits of distributed energy resources (DERs) and the associated cost. This document proposes an extension of this endeavor that offers a generalizable framework for valuation that quantifiesmore » the broad set of values for a wide range of technologies (including energy efficiency options, distributed resources, transmission, and generation) as well as policy options that affect all aspects of the entire generation and delivery system of the electricity infrastructure. The extension includes a comprehensive valuation framework of monetizable and non-monetizable benefits of new technologies and services beyond the traditional reliability objectives. The benefits are characterized into the following categories: sustainability, affordability, and security, flexibility, and resilience. This document defines the elements of a generic valuation framework and process as well as system properties and metrics by which value streams can be derived. The valuation process can be applied to determine the value on the margin of incremental system changes. This process is typically performed when estimating the value of a particular project (e.g., value of a merchant generator, or a distributed photovoltaic (PV) rooftop installation). Alternatively, the framework can be used when a widespread change in the grid operation, generation mix, or transmission topology is to be valued. In this case a comprehensive system analysis is required.« less

Authors:
 [1];  [1];  [1];  [1]
  1. Pacific Northwest National Lab. (PNNL), Richland, WA (United States)
Publication Date:
Research Org.:
Pacific Northwest National Lab. (PNNL), Richland, WA (United States)
Sponsoring Org.:
USDOE
OSTI Identifier:
1393762
Report Number(s):
PNNL-25633
RC0403000
DOE Contract Number:
AC05-76RL01830
Resource Type:
Technical Report
Country of Publication:
United States
Language:
English
Subject:
24 POWER TRANSMISSION AND DISTRIBUTION

Citation Formats

Kintner-Meyer, Michael C. W., Homer, Juliet S., Balducci, Patrick J., and Weimar, Mark R. Valuation of Electric Power System Services and Technologies. United States: N. p., 2017. Web. doi:10.2172/1393762.
Kintner-Meyer, Michael C. W., Homer, Juliet S., Balducci, Patrick J., & Weimar, Mark R. Valuation of Electric Power System Services and Technologies. United States. doi:10.2172/1393762.
Kintner-Meyer, Michael C. W., Homer, Juliet S., Balducci, Patrick J., and Weimar, Mark R. Tue . "Valuation of Electric Power System Services and Technologies". United States. doi:10.2172/1393762. https://www.osti.gov/servlets/purl/1393762.
@article{osti_1393762,
title = {Valuation of Electric Power System Services and Technologies},
author = {Kintner-Meyer, Michael C. W. and Homer, Juliet S. and Balducci, Patrick J. and Weimar, Mark R.},
abstractNote = {Accurate valuation of existing and new technologies and grid services has been recognized to be important to stimulate investment in grid modernization. Clear, transparent, and accepted methods for estimating the total value (i.e., total benefits minus cost) of grid technologies and services are necessary for decision makers to make informed decisions. This applies to home owners interested in distributed energy technologies, as well as to service providers offering new demand response services, and utility executives evaluating best investment strategies to meet their service obligation. However, current valuation methods lack consistency, methodological rigor, and often the capabilities to identify and quantify multiple benefits of grid assets or new and innovative services. Distributed grid assets often have multiple benefits that are difficult to quantify because of the locational context in which they operate. The value is temporally, operationally, and spatially specific. It varies widely by distribution systems, transmission network topology, and the composition of the generation mix. The Electric Power Research Institute (EPRI) recently established a benefit-cost framework that proposes a process for estimating multiple benefits of distributed energy resources (DERs) and the associated cost. This document proposes an extension of this endeavor that offers a generalizable framework for valuation that quantifies the broad set of values for a wide range of technologies (including energy efficiency options, distributed resources, transmission, and generation) as well as policy options that affect all aspects of the entire generation and delivery system of the electricity infrastructure. The extension includes a comprehensive valuation framework of monetizable and non-monetizable benefits of new technologies and services beyond the traditional reliability objectives. The benefits are characterized into the following categories: sustainability, affordability, and security, flexibility, and resilience. This document defines the elements of a generic valuation framework and process as well as system properties and metrics by which value streams can be derived. The valuation process can be applied to determine the value on the margin of incremental system changes. This process is typically performed when estimating the value of a particular project (e.g., value of a merchant generator, or a distributed photovoltaic (PV) rooftop installation). Alternatively, the framework can be used when a widespread change in the grid operation, generation mix, or transmission topology is to be valued. In this case a comprehensive system analysis is required.},
doi = {10.2172/1393762},
journal = {},
number = ,
volume = ,
place = {United States},
year = {Tue Aug 01 00:00:00 EDT 2017},
month = {Tue Aug 01 00:00:00 EDT 2017}
}

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