a review of solar pv benefit & cost studies€¦ · a confluence of factors including rapidly...
TRANSCRIPT
Con
tact
s:
Lena
Han
sen,
Prin
cipa
l, lh
anse
n@rm
i.org
Virg
inia
Lac
y, S
enio
r C
onsu
ltant
, vla
cy@
rmi.o
rg
Dev
i Glic
k, A
naly
st, d
glic
k@rm
i.org
1820
Fol
som
Str
eet
| Bou
lder
, C
O 8
0302
| R
MI.o
rg
Cop
yrig
ht R
ocky
Mou
ntai
n In
stitu
te.
Pub
lishe
d A
pril
201
3.
dow
nloa
d a
t: w
ww
.rm
i.org
/ela
b_e
mP
ower
A R
EVIE
W O
F S
OLA
R P
V B
ENEF
IT &
CO
ST
STU
DIE
S
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 1
of 5
9
AB
OU
T TH
IS D
OC
UM
EN
T
ES
: EX
EC
UTI
VE
SU
MM
AR
Y....
......
......
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.....
3
01: F
RA
MIN
G T
HE
NE
ED
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......
......
. 6
02: S
ETT
ING
TH
E S
TAG
E...
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......
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......
... 1
1
03: A
NA
LYS
IS F
IND
ING
S...
......
......
......
......
......
... 2
0
04: S
TUD
Y O
VE
RV
IEW
S...
......
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.... 4
2
05: S
OU
RC
ES
......
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.....
57
The
E
lect
ricity
In
nova
tion
Lab
(e
- Lab
) b
rings
to
geth
er
thou
ght
lead
ers
and
dec
isio
n m
aker
s fr
om a
cros
s th
e U
.S.
elec
tric
ity s
ecto
r to
ad
dre
ss
cri
tic
al
inst
itu
tio
na
l,
reg
ula
tory
, b
usi
ne
ss,
econ
omic
, an
d te
chni
cal b
arrie
rs t
o th
e e
cono
mic
d
eplo
ymen
t of
dis
trib
uted
res
ourc
es.
In p
artic
ular
, e- L
ab
wor
ks
to
answ
er t
hree
key
q
uest
ions
:
• H
ow c
an w
e un
der
stan
d a
nd e
ffect
ivel
y co
mm
unic
ate
the
cost
s an
d b
enefi
ts o
f d
istr
ibut
ed r
esou
rces
as
par
t of
the
el
ectr
icity
sys
tem
and
cre
ate
grea
ter
grid
fle
xib
ility
?
• H
ow c
an w
e ha
rmon
ize
regu
lato
ry
fram
ewor
ks, p
ricin
g st
ruct
ures
, and
b
usin
ess
mod
els
of u
tiliti
es a
nd d
istr
ibut
ed
reso
urce
dev
elop
ers
for
grea
test
ben
efit
to
cust
omer
s an
d s
ocie
ty a
s a
who
le?
• H
ow c
an w
e ac
cele
rate
the
pac
e of
ec
onom
ic d
istr
ibut
ed r
esou
rce
adop
tion?
A m
ulti-
year
pro
gram
, e- L
ab r
egul
arly
con
vene
s its
mem
ber
s to
iden
tify,
tes
t, an
d sp
read
pra
ctic
al
solu
tions
to
th
e
chal
leng
es
inhe
rent
in
th
ese
que
stio
ns.
e- Lab
ha
s th
ree
annu
al
mee
tings
, co
uple
d w
ith o
ngoi
ng p
roje
ct w
ork,
all
faci
litat
ed
and
sup
por
ted
by
Roc
ky M
ount
ain
Ins
titut
e. e
-
Lab
mee
tings
allo
w m
emb
ers
to s
hare
lea
rnin
gs,
bes
t p
ract
ices
, an
d an
alys
is r
esul
ts;
colla
bor
ate
arou
nd k
ey i
ssue
s or
nee
ds;
and
con
duc
t d
eep
-d
ives
into
res
earc
h an
d a
naly
sis
find
ings
.
WH
AT IS
e- L
AB
?
2
The
obje
ctiv
e of
thi
s e- L
ab d
iscu
ssio
n d
ocum
ent
is t
o as
sess
wha
t is
kno
wn
and
un
know
n ab
out
the
cate
goriz
atio
n, m
etho
dol
ogic
al b
est
pra
ctic
es, a
nd g
aps
arou
nd t
he
ben
efits
and
cos
ts o
f dis
trib
uted
pho
tovo
ltaic
s (D
PV
), an
d t
o b
egin
to
esta
blis
h a
clea
r fo
und
atio
n fr
om w
hich
ad
diti
onal
wor
k on
ben
efit/
cost
ass
essm
ents
and
pric
ing
stru
ctur
e d
evel
opm
ent
can
be
bui
lt.
e- Lab
mem
ber
s an
d a
dvi
sors
wer
e in
vite
d t
o p
rovi
de
inp
ut o
n th
is r
epor
t. T
he
asse
ssm
ent
grea
tly b
enefi
ted
from
con
trib
utio
ns b
y th
e fo
llow
ing
ind
ivid
uals
: Ste
phe
n Fr
antz
, Sac
ram
ento
Mun
icip
al U
tility
Dis
tric
t (S
MU
D);
Mas
on E
mne
tt, F
eder
al E
nerg
y R
egul
ator
y C
omm
issi
on (F
ER
C);
Era
n M
ahre
r, S
olar
Ele
ctric
Pow
er A
ssoc
iatio
n (S
EPA
); S
unil
Che
rian,
Sp
irae;
Kar
l Rab
ago,
Rab
ago
Ene
rgy;
Tom
Bril
l and
Chr
is Y
unke
r, S
an
Die
go G
as &
Ele
ctric
(SD
G&
E);
and
Ste
ve W
olfo
rd, S
unve
rge.
This
e- L
ab w
ork
pro
duc
t w
as p
rep
ared
by
Roc
ky M
ount
ain
Inst
itute
to
sup
por
t e- L
aban
d in
dus
try-
wid
e d
iscu
ssio
ns a
bou
t d
istr
ibut
ed e
nerg
y re
sour
ce v
alua
tion.
e- L
ab is
a
join
t co
llab
orat
ion,
con
vene
d b
y R
MI,
with
par
ticip
atio
n fr
om s
take
hold
ers
acro
ss t
he
elec
tric
ity in
dus
try.
e- L
ab is
not
a c
onse
nsus
org
aniz
atio
n, a
nd t
he v
iew
s ex
pre
ssed
in
this
doc
umen
t d
o no
t ne
cess
arily
rep
rese
nt t
hose
of a
ny in
div
idua
l e- L
ab m
emb
er o
r su
pp
ortin
g or
gani
zatio
ns. A
ny e
rror
s ar
e so
lely
the
res
pon
sib
ility
of R
MI.
TAB
LE O
F C
ON
TEN
TS
OB
JEC
TIV
E A
ND
AC
KN
OW
LED
GE
ME
NTS
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 2
of 5
9
ES
EXE
CU
TIV
E S
UM
MA
RY
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 3
of 5
9
EXE
CU
TIV
E S
UM
MA
RY
4
TH
E N
EE
DTh
e ad
diti
on o
f dis
trib
uted
ene
rgy
reso
urce
s (D
ER
s) o
nto
the
grid
cr
eate
s ne
w o
pp
ortu
nitie
s an
d c
halle
nges
bec
ause
of t
heir
uniq
ue
sitin
g, o
per
atio
nal,
and
ow
ners
hip
cha
ract
eris
tics
com
par
ed t
o co
nven
tiona
l cen
tral
ized
res
ourc
es.
Tod
ay, t
he in
crea
sing
ly r
apid
ad
optio
n of
dis
trib
uted
sol
ar
pho
tovo
ltaic
s (D
PV
) in
par
ticul
ar is
driv
ing
a he
ated
deb
ate
abou
t w
heth
er D
PV
cre
ates
ben
efits
or
imp
oses
cos
ts t
o st
akeh
old
ers
with
in t
he e
lect
ricity
sys
tem
. But
the
wid
e va
riatio
n in
ana
lysi
s ap
pro
ache
s an
d q
uant
itativ
e to
ols
used
by
diff
eren
t p
artie
s in
d
iffer
ent
juris
dic
tions
is in
cons
iste
nt, c
onfu
sing
, and
freq
uent
ly
lack
s tr
ansp
aren
cy.
With
out
incr
ease
d u
nder
stan
din
g of
the
ben
efits
and
cos
ts o
f D
ER
s, t
here
is li
ttle
ab
ility
to
mak
e ef
fect
ive
trad
eoffs
bet
wee
n in
vest
men
ts.
OB
JEC
TIV
E O
F T
HIS
DO
CU
ME
NT
The
obje
ctiv
e of
thi
s e- L
ab d
iscu
ssio
n d
ocum
ent
is t
o as
sess
w
hat
is k
now
n an
d u
nkno
wn
abou
t th
e ca
tego
rizat
ion,
m
etho
dol
ogic
al b
est
pra
ctic
es, a
nd g
aps
arou
nd t
he b
enefi
ts a
nd
cost
s of
DP
V, a
nd t
o b
egin
to
esta
blis
h a
clea
r fo
und
atio
n fr
om
whi
ch a
dd
ition
al w
ork
on b
enefi
t/co
st a
sses
smen
ts a
nd p
ricin
g st
ruct
ure
des
ign
can
be
bui
lt.
This
dis
cuss
ion
doc
umen
t re
view
s 15
DP
V b
enefi
t/co
st s
tud
ies
by
utili
ties,
nat
iona
l lab
s, a
nd o
ther
org
aniz
atio
ns. C
omp
lete
d
bet
wee
n 20
05 a
nd 2
013,
the
se s
tud
ies
refle
ct a
sig
nific
ant
rang
e of
est
imat
ed D
PV
val
ue.
KE
Y IN
SIG
HT
SN
o st
udy
com
pre
hens
ivel
y ev
alua
ted
the
ben
efits
and
cos
ts o
f D
PV,
alth
ough
man
y ac
know
led
ge a
dd
ition
al s
ourc
es o
f ben
efit
or
cost
and
man
y ag
ree
on t
he b
road
cat
egor
ies
of b
enefi
t an
d c
ost.
Th
ere
is b
road
rec
ogni
tion
that
som
e b
enefi
ts a
nd c
osts
may
be
diffi
cult
or im
pos
sib
le t
o q
uant
ify, a
nd s
ome
accr
ue t
o d
iffer
ent
stak
ehol
der
s.
Ther
e is
a s
igni
fican
t ra
nge
of e
stim
ated
val
ue a
cros
s st
udie
s,
driv
en p
rimar
ily b
y d
iffer
ence
s in
loca
l con
text
, inp
ut
assu
mp
tions
, and
met
hod
olog
ical
ap
pro
ache
s.
Loca
l co
ntex
t: E
lect
ricity
sys
tem
cha
ract
eris
tics—
gene
ratio
n m
ix, d
eman
d p
roje
ctio
ns, i
nves
tmen
t p
lans
, mar
ket
stru
ctur
es—
vary
acr
oss
utili
ties,
sta
tes,
and
reg
ions
. In
put
ass
ump
tio
ns: I
nput
ass
ump
tions
—na
tura
l gas
pric
e fo
reca
sts,
sol
ar p
ower
pro
duc
tion,
pow
er p
lant
hea
t ra
tes—
can
vary
wid
ely.
M
etho
do
log
ies:
Met
hod
olog
ical
diff
eren
ces
that
mos
t si
gnifi
cant
ly a
ffect
res
ults
incl
ude
(1) r
esol
utio
n of
ana
lysi
s an
d g
ranu
larit
y of
dat
a, (2
) ass
umed
cos
t an
d b
enefi
t ca
tego
ries
and
sta
keho
lder
per
spec
tives
con
sid
ered
, and
(3)
app
roac
hes
to c
alcu
latin
g in
div
idua
l val
ues.
Bec
ause
of t
hese
diff
eren
ces,
com
par
ing
resu
lts a
cros
s st
udie
s ca
n b
e in
form
ativ
e, b
ut s
houl
d b
e d
one
with
the
und
erst
and
ing
that
res
ults
mus
t b
e no
rmal
ized
for
cont
ext,
ass
ump
tions
, or
met
hod
olog
y.
Whi
le d
etai
led
met
hod
olog
ical
diff
eren
ces
abou
nd, t
here
is
gene
ral a
gree
men
t on
ove
rall
app
roac
h to
est
imat
ing
ener
gy
valu
e an
d s
ome
phi
loso
phi
cal a
gree
men
t on
cap
acity
val
ue,
alth
ough
the
re r
emai
n ke
y d
iffer
ence
s in
cap
acity
met
hod
olog
y.Th
ere
is s
igni
fican
tly le
ss a
gree
men
t on
ove
rall
app
roac
h to
es
timat
ing
grid
sup
por
t se
rvic
es a
nd c
urre
ntly
unm
onet
ized
va
lues
incl
udin
g fin
anci
al a
nd s
ecur
ity r
isk,
env
ironm
ent,
and
so
cial
val
ue.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3P
age
4 of
59
5
EXE
CU
TIV
E S
UM
MA
RY
(CO
NT’
D)
IMP
LIC
ATIO
NS
Met
hod
s fo
r id
entif
ying
, ass
essi
ng a
nd q
uant
ifyin
g th
e b
enefi
ts a
nd
cost
s of
dis
trib
uted
res
ourc
es a
re a
dva
ncin
g ra
pid
ly, b
ut im
por
tant
ga
ps
rem
ain
to b
e fil
led
bef
ore
this
typ
e of
ana
lysi
s ca
n p
rovi
de
an
adeq
uate
foun
dat
ion
for
pol
icym
aker
s an
d r
egul
ator
s en
gage
d in
d
eter
min
ing
leve
ls o
f inc
entiv
es, f
ees,
and
pric
ing
stru
ctur
es fo
r D
PV
and
oth
er D
ER
s.
Inan
y b
enefi
t/co
st s
tud
y, it
is c
ritic
al t
o b
e tr
ansp
aren
t ab
out
assu
mp
tions
, per
spec
tives
, sou
rces
and
met
hod
olog
ies
so t
hat
stud
ies
can
be
mor
e re
adily
com
par
ed, b
est
pra
ctic
es d
evel
oped
, an
d d
river
s of
res
ults
und
erst
ood
.
Whi
le it
may
not
be
feas
ible
to
qua
ntify
or
asse
ss s
ourc
es o
f ben
efit
and
cos
t co
mp
rehe
nsiv
ely,
ben
efit/
cost
stu
die
s m
ust
exp
licitl
y d
ecid
e if
and
how
to
acco
unt
for
each
sou
rce
of v
alue
and
sta
te
whi
ch a
re in
clud
ed a
nd w
hich
are
not
.
Whi
le in
div
idua
l jur
isd
ictio
ns m
ust
adap
t ap
pro
ache
s b
ased
on
thei
r lo
cal c
onte
xt, s
tand
ard
izat
ion
of c
ateg
orie
s, d
efini
tions
, and
m
etho
dol
ogie
s sh
ould
be
pos
sib
le t
o so
me
deg
ree
and
will
hel
p
ensu
re a
ccou
ntab
ility
and
ver
ifiab
ility
of b
enefi
t an
d c
ost
estim
ates
th
at p
rovi
de
a fo
und
atio
n fo
r p
olic
ymak
ing.
The
mos
t si
gnifi
cant
met
hod
olog
ical
gap
sin
clud
e:
Dis
trib
utio
n va
lue:
The
ben
efits
or
cost
s th
at D
PV
cre
ates
in
the
dis
trib
utio
n sy
stem
are
inhe
rent
ly lo
cal,
so a
ccur
atel
y es
timat
ing
valu
e re
qui
res
muc
h m
ore
anal
ytic
al g
ranu
larit
y an
d
ther
efor
e gr
eate
r d
ifficu
lty.
Gri
d s
upp
ort
ser
vice
s va
lue:
The
re c
ontin
ues
to b
e un
cert
aint
y ar
ound
whe
ther
and
how
DP
V c
an p
rovi
de
or
req
uire
ad
diti
onal
grid
sup
por
t se
rvic
es, b
ut t
his
coul
d
pot
entia
lly b
ecom
e an
incr
easi
ngly
imp
orta
nt v
alue
.Fi
nanc
ial,
secu
rity
, env
iro
nmen
tal,
and
so
cial
val
ues:
The
se
valu
es a
re la
rgel
y (th
ough
not
com
pre
hens
ivel
y) u
nmon
etiz
ed
as p
art
of t
he e
lect
ricity
sys
tem
and
som
e ar
e ve
ry d
ifficu
lt to
q
uant
ify.
LOO
KIN
G A
HE
AD
Thus
far,
stud
ies
have
mad
e si
mp
lifyi
ng a
ssum
ptio
ns t
hat
imp
licitl
y as
sum
e hi
stor
ical
ly lo
w p
enet
ratio
ns o
f DP
V. A
s th
e p
enet
ratio
n of
DP
V o
n th
e el
ectr
ic s
yste
m in
crea
ses,
mor
e so
phi
stic
ated
, gra
nula
r an
alyt
ical
ap
pro
ache
s w
ill b
e ne
eded
an
d t
he t
otal
val
ue is
like
ly t
o ch
ange
.
Stu
die
s ha
ve la
rgel
y fo
cuse
d o
n D
PV
by
itsel
f. B
ut a
con
fluen
ce
of fa
ctor
s is
like
ly t
o d
rive
incr
ease
d a
dop
tion
of t
he fu
ll sp
ectr
um o
f ren
ewab
le a
nd d
istr
ibut
ed r
esou
rces
, req
uirin
g a
cons
ider
atio
n of
DP
V’s
ben
efits
and
cos
ts in
the
con
text
of a
ch
angi
ng s
yste
m.
With
bet
ter
reco
gniti
on o
f the
cos
ts a
nd b
enefi
ts t
hat
all D
ER
s ca
n cr
eate
, inc
lud
ing
PD
V, p
ricin
g st
ruct
ures
and
bus
ines
s m
odel
s ca
n b
e b
ette
r al
igne
d, e
nab
ling
grea
ter
econ
omic
d
eplo
ymen
t of
DE
Rs
and
low
er o
vera
ll sy
stem
cos
ts fo
r ra
tep
ayer
s.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3P
age
5 of
59
over
view
dis
trib
uted
ene
rgy
reso
urce
s
stru
ctur
al m
isal
ignm
ents
stru
ctur
al m
isal
ignm
ents
in p
ract
ice
01FRA
MIN
G T
HE
NE
ED
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 6
of 5
9
FRA
MIN
G T
HE
NE
ED
7
A c
onflu
ence
of f
acto
rs in
clud
ing
rap
idly
falli
ng s
olar
pric
es, s
upp
ortiv
e p
olic
ies
and
new
ap
pro
ache
s to
fina
nce
are
lead
ing
to a
ste
adily
incr
easi
ng s
olar
PV
m
arke
t.
In 2
012,
the
US
ad
ded
2 G
W o
f sol
ar P
V t
o th
e na
tion’
s ge
nera
tion
mix
, of
whi
ch a
pp
roxi
mat
ely
50%
wer
e cu
stom
er-s
ited
sol
ar, n
et-m
eter
ed
pro
ject
s. 1
Sol
ar p
enet
ratio
ns in
cer
tain
reg
ions
are
bec
omin
g si
gnifi
cant
. Ab
out
80%
of
cus
tom
er-s
ited
PV
is c
once
ntra
ted
in s
tate
s w
ith e
ither
am
ple
sol
ar
reso
urce
and
/ or
esp
ecia
lly s
olar
-frie
ndly
pol
icie
s: C
alifo
rnia
, New
Jer
sey,
A
rizon
a, H
awai
i and
Mas
sach
uset
ts. 2
The
add
ition
of D
PV
ont
o th
e gr
id c
reat
es n
ew c
halle
nges
and
op
por
tuni
ties
bec
ause
of i
ts u
niq
ue s
iting
, op
erat
iona
l, an
d o
wne
rshi
p c
hara
cter
istic
s co
mp
ared
to
conv
entio
nal c
entr
aliz
ed r
esou
rces
. The
val
ue o
f DP
V is
te
mp
oral
ly, o
per
atio
nally
and
geo
grap
hica
lly s
pec
ific
and
var
ies
by
dis
trib
utio
n fe
eder
, tra
nsm
issi
on li
ne c
onfig
urat
ion,
and
com
pos
ition
of t
he g
ener
atio
n fle
et.
Und
er t
oday
’s r
egul
ator
y an
d p
ricin
g st
ruct
ures
, mul
tiple
mis
alig
nmen
ts a
long
ec
onom
ic, s
ocia
l and
tec
hnic
al d
imen
sion
s ar
e em
ergi
ng. F
or e
xam
ple
, pric
ing
mec
hani
sms
are
not
in p
lace
to
reco
gniz
e or
rew
ard
ser
vice
tha
t is
bei
ng
pro
vid
ed b
y ei
ther
the
util
ity o
r cu
stom
er.
Ele
ctric
ity s
ecto
r st
akeh
old
ers
arou
nd t
he c
ount
ry a
re r
ecog
nizi
ng t
he
imp
orta
nce
of p
rop
erly
val
uing
DP
V, t
he c
urre
nt la
ck o
f cla
rity
arou
nd t
he c
osts
an
d b
enefi
ts t
hat
driv
e D
PV
’s v
alue
or
how
to
calc
ulat
e it.
To e
nab
le b
ette
r te
chni
cal i
nteg
ratio
n an
d e
cono
mic
op
timiz
atio
n, it
is c
ritic
al t
o b
ette
r un
der
stan
d t
he s
ervi
ces
that
DP
V c
an p
rovi
de,
and
the
cos
ts a
nd
ben
efits
of t
hose
ser
vice
s as
a fo
und
atio
n fo
r m
ore
accu
rate
pric
ing
and
m
arke
t si
gnal
s. A
s th
e p
enet
ratio
n of
DP
V a
nd o
ther
cus
tom
er-s
ited
res
ourc
es
incr
ease
s, a
ccur
ate
pric
ing
and
mar
ket
sign
als
can
help
alig
n st
akeh
old
er
goal
s, m
inim
ize
tota
l sys
tem
cos
t, a
nd m
axim
ize
tota
l net
val
ue.
1. S
olar
Ele
ctric
Pow
er A
ssoc
iatio
n. J
une
2013
. 201
2 S
EPA
Util
ity S
olar
Ran
king
s, W
ashi
ngto
n, D
C.
2. Ib
id.
Pho
to c
ourt
esy
of S
hutt
erst
ock
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 7
of 5
9
DIS
TRIB
UTE
D E
NE
RG
Y R
ES
OU
RC
ES
(DE
Rs)
DU
E T
O U
NIQ
UE
CH
AR
AC
TER
ISTI
CS
, DE
Rs
BE
HA
VE
DIF
FER
EN
TLY
FR
OM
CO
NV
EN
TIO
NA
L R
ES
OU
RC
ES
—T
HIS
DIS
CU
SS
ION
DO
CU
ME
NT
FO
CU
SE
S O
N D
IST
RIB
UT
ED
PH
OT
OV
OLT
AIC
S (D
PV
)
DIS
TR
IBU
TE
D E
NE
RG
Y R
ES
OU
RC
ES
(DE
Rs)
:dem
and
- an
d s
upp
ly-s
ide
reso
urce
s th
at c
an b
e d
eplo
yed
thr
ough
out
an e
lect
ric d
istr
ibut
ion
syst
em t
o m
eet
the
ener
gy a
nd r
elia
bili
ty n
eed
s of
the
cus
tom
ers
serv
ed b
y th
at s
yste
m. D
ER
s ca
n b
e in
stal
led
on
eith
er t
he c
usto
mer
sid
e or
the
util
ity s
ide
of t
he m
eter
.
TY
PE
S O
F D
ER
s:
Effi
cien
cyTe
chno
logi
es a
nd b
ehav
iora
l cha
nges
tha
t re
duc
e th
e q
uant
ity o
f ene
rgy
that
cus
tom
ers
need
to
mee
t al
l of t
heir
ener
gy-r
elat
ed n
eed
s. T
he m
ain
typ
e is
:•
end
-use
d e
ffici
ency
Dis
trib
uted
gen
erat
ion
Sm
all,
self-
cont
aine
d e
nerg
y so
urce
s lo
cate
d n
ear
the
final
p
oint
of e
nerg
y co
nsum
ptio
n. T
he m
ain
dis
trib
uted
ge
nera
tion
sour
ces
are:
•S
olar
PV
•C
omb
ined
hea
t &
pow
er•
Sm
all-
scal
e w
ind
•O
ther
s (i.
e., f
uel c
ells
)
Dis
trib
uted
flex
ibili
ty &
sto
rag
eA
col
lect
ion
of t
echn
olog
ies
that
allo
ws
the
over
all s
yste
m
to u
se e
nerg
y sm
arte
r an
d m
ore
effic
ient
ly b
y st
orin
g it
whe
n su
pp
ly e
xcee
ds
dem
and
, and
prio
ritiz
ing
need
whe
n d
eman
d e
xcee
ds
sup
ply
. The
se t
echn
olog
ies
incl
ude:
•D
eman
d r
esp
onse
•E
lect
ric v
ehic
les
•Th
erm
al s
tora
ge•
Bat
tery
sto
rage
Dis
trib
uted
inte
llig
ence
Tech
nolo
gies
tha
t co
mb
ine
sens
ory,
com
mun
icat
ion,
and
co
ntro
l fun
ctio
ns t
o su
pp
ort
the
elec
tric
ity s
yste
m, a
nd
mag
nify
the
val
ue o
f DE
R s
yste
m in
tegr
atio
n. E
xam
ple
s in
clud
e:•
Sm
art
inve
rter
s•
Hom
e-ar
ea n
etw
orks
FUT
UR
E S
YS
TE
M/V
ALU
E C
ON
ST
ELL
ATIO
N:
TW
O-W
AY
P
OW
ER
FLO
W
CU
RR
EN
T S
YS
TE
M/V
ALU
E C
HA
IN:
ON
E-W
AY
POW
ER F
LOW
WH
AT M
AK
ES
DE
Rs
UN
IQU
E:
Siti
ngS
mal
ler,
mor
e m
odul
ar
ener
gy r
esou
rces
can
be
inst
alle
d b
y d
isp
arat
e ac
tors
out
sid
e of
the
p
urvi
ew o
f cen
tral
ly
coor
din
ated
res
ourc
e p
lann
ing.
Op
erat
ions
Ene
rgy
reso
urce
s on
the
d
istr
ibut
ion
netw
ork
oper
ate
outs
ide
of c
entr
ally
co
ntro
lled
dis
pat
chin
g m
echa
nism
s th
at c
ontr
ol
the
real
-tim
e b
alan
ce o
f ge
nera
tion
and
dem
and
.
Ow
ners
hip
DE
Rs
can
be
finan
ced
, in
stal
led
or
owne
d b
y th
e cu
stom
er o
r a
third
par
ty,
bro
aden
ing
the
typ
ical
p
lann
ing
cap
abili
ty a
nd
reso
urce
inte
grat
ion
app
roac
h.
8
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 8
of 5
9
DE
RS
ER
VIC
E P
RO
VID
ER
S
DE
RC
US
TO
ME
RS
NO
N-D
ER
CU
ST
OM
ER
S
SO
CIA
L E
QU
ITY
If co
sts
are
incu
rred
by
DE
R c
usto
mer
s th
at a
re n
ot p
aid
for,
thos
e co
sts
wou
ld
be
allo
cate
d t
o th
e re
st o
f cus
tom
ers.
C
onve
rsel
y, D
ER
cus
tom
ers
also
p
rovi
de
pro
vid
e b
enefi
ts t
o ot
her
cust
omer
s an
d t
o so
ciet
y.
BE
NE
FIT
AN
D C
OS
T
RE
CO
GN
ITIO
N A
ND
A
LLO
CAT
ION
Mec
hani
sms
are
not
in p
lace
to
tran
spar
ently
rec
ogni
ze o
r co
mp
ensa
te s
ervi
ce (b
e it
mon
etiz
ed g
rid s
ervi
ces
like
ener
gy, c
apac
ity o
r b
alan
cing
su
pp
ly a
nd d
eman
d, o
r le
ss
cons
iste
ntly
mon
etiz
ed v
alue
s,
such
as
carb
on e
mis
sion
s sa
ving
s) p
rovi
ded
by
the
utili
ty o
r th
e cu
stom
er. T
o th
e ut
ility
, re
venu
e fr
om D
ER
cus
tom
ers
may
not
mat
ch t
he c
ost
to s
erve
th
ose
cust
omer
s. T
o th
e cu
stom
er, b
ill s
avin
gs o
r cr
edit
may
not
mat
ch t
he v
alue
p
rovi
ded
.
service
$$
FLE
XIB
ILIT
Y &
PR
ED
ICTA
BIL
ITY
Pro
vid
ing
relia
ble
pow
er r
equi
res
grid
flex
ibili
ty a
nd
pre
dic
tab
ility
. Pow
er fr
om s
ome
dis
trib
uted
re
new
able
s flu
ctua
te w
ith t
he w
eath
er, a
dd
ing
varia
bili
ty, a
nd r
equi
re s
mar
t in
tegr
atio
n to
bes
t sh
ape
thei
r ou
tput
to
the
grid
. Leg
acy
stan
dar
ds
and
rul
es c
an b
e re
stric
tive.
SO
CIA
L P
RIO
RIT
IES
Soc
iety
val
ues
the
envi
ronm
enta
l and
so
cial
ben
efits
tha
t D
ER
s co
uld
pro
vid
e,
but
tho
se b
enefi
ts a
re o
ften
ext
erna
lized
an
d u
nmon
etiz
ed.
Ad
apte
d fr
om R
MI,
Net
Ene
rgy
Met
erin
g, Z
ero
Net
Ene
rgy
And
The
Dis
trib
uted
Ene
rgy
Res
ourc
e Fu
ture
: Ad
aptin
g E
lect
ric U
tility
Bus
ines
s M
odel
s Fo
r Th
e 21
st C
entu
ry
STR
UC
TUR
AL
MIS
ALI
GN
ME
NTS
TOD
AY, O
PE
RAT
ION
AL
AN
D P
RIC
ING
ME
CH
AN
ISM
S D
ES
IGN
ED
FO
R A
N H
ISTO
RIC
ALL
Y C
EN
TRA
LIZ
ED
ELE
CTR
ICIT
Y
SY
STE
M A
RE
NO
T W
ELL
-AD
AP
TED
TO
TH
E IN
TEG
RAT
ION
OF
DE
RS
CA
US
ING
FR
ICTI
ON
AN
D IN
EFF
ICIE
NC
Y
UT
ILIT
Y/G
RID
9
LOC
ATIO
N &
TIM
ELi
mite
d fe
edb
ack
loop
to
cus
tom
ers
that
the
co
sts
or b
enefi
t of
any
el
ectr
icity
res
ourc
e,
esp
ecia
lly D
ER
s, v
ary
by
loca
tion
and
tim
e.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 9
of 5
9
STR
UC
TUR
AL
MIS
ALI
GN
ME
NTS
IN P
RA
CTI
CE
10
THE
SE
STR
UC
TUR
AL
MIS
ALI
GN
ME
NTS
AR
E L
EA
DIN
G T
O IM
PO
RTA
NT
QU
ES
TIO
NS
, DE
BAT
E, A
ND
CO
NFL
ICT
VALU
E
UN
CE
RTA
INTY
......
DR
IVE
SH
EA
DLI
NE
S...
...R
AIS
ING
KE
Y
QU
ES
TIO
NS
WH
AT IF
A D
PV
CU
ST
OM
ER
DO
ES
NO
T P
AY
FO
R
TH
E F
ULL
CO
ST
TO
SE
RV
E T
HE
IR D
EM
AN
D?
WH
AT IF
A D
PV
CU
ST
OM
ER
IS N
OT
FU
LLY
CO
MP
EN
SAT
ED
FO
R T
HE
SE
RV
ICE
TH
EY
PR
OV
IDE?
Wha
t b
enefi
ts c
an c
usto
mer
s p
rovi
de?
Is t
he a
bili
ty o
f cu
stom
ers
to p
rovi
de
ben
efits
co
ntin
gent
on
anyt
hing
?
Wha
t co
sts
are
incu
rred
to
sup
por
t D
ER
cus
tom
er n
eed
s?
Wha
t ar
e th
e b
est
pra
ctic
e m
etho
dol
ogie
s to
ass
ess
ben
efits
and
cos
ts?
How
sho
uld
ext
erna
lized
and
un
mon
etiz
ed v
alue
s, s
uch
as
envi
ronm
enta
l and
soc
ial
valu
es, b
e re
cogn
ized
?
How
can
ben
efits
and
cos
ts b
e m
ore
effe
ctiv
ely
allo
cate
d a
nd
pric
ed?
TRA
DIT
ION
AL
CO
ST
TO S
ER
VE
CU
STO
ME
RB
ILL
$/Y
EA
R
CO
ST
TO S
ER
VE
CU
STO
ME
RB
ILL
CO
ST
TO S
ER
VE
CU
STO
ME
RB
ILL
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 10
of 5
9
02SE
TTIN
G T
HE
STA
GE
defi
ning
val
ue
cate
gorie
s of
val
ue
stak
ehol
der
imp
licat
ions
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 11
of 5
9
SE
TTIN
G T
HE
STA
GE
12
Whe
n co
nsid
erin
g th
e to
tal v
alue
of D
PV
or
any
elec
tric
ity r
esou
rce,
it is
cr
itica
l to
cons
ider
the
typ
es o
f val
ue, t
he s
take
hold
er p
ersp
ectiv
e an
d t
he
flow
of b
enefi
ts a
nd c
osts
–tha
t is
, who
incu
rs t
he c
osts
and
who
rec
eive
s th
e b
enefi
ts (o
r av
oid
s th
e co
sts)
.
For
the
pur
pos
es o
f thi
s re
por
t, v
alue
is d
efine
d a
s ne
t va
lue,
i.e.
ben
efits
m
inus
cos
ts. D
epen
din
g up
on t
he s
ize
of t
he b
enefi
t an
d t
he s
ize
of t
he c
ost,
va
lue
can
be
pos
itive
or
nega
tive.
A v
arie
ty o
f cat
egor
ies
of b
enefi
ts o
r co
sts
of D
PV
hav
e b
een
cons
ider
ed o
r ac
know
led
ged
in e
valu
atin
g th
e va
lue
of D
PV.
Bro
adly
, the
se c
ateg
orie
s ar
e:
ener
gy, s
yste
m lo
sses
, cap
acity
(gen
erat
ion,
tra
nsm
issi
on a
nd d
istr
ibut
ion)
, gr
id s
upp
ort
serv
ices
, fina
ncia
l ris
k, s
ecur
ity r
isk,
env
ironm
enta
l and
soc
ial.
Thes
e ca
tego
ries
of c
osts
and
ben
efits
diff
er s
igni
fican
tly b
y th
e d
egre
e to
w
hich
the
y ar
e re
adily
qua
ntifi
able
or
ther
e is
a g
ener
ally
acc
epte
d
met
hod
olog
y fo
r d
oing
so.
For
exa
mp
le, t
here
is g
ener
al a
gree
men
t on
ove
rall
app
roac
h to
est
imat
ing
ener
gy v
alue
and
som
e p
hilo
sop
hica
l agr
eem
ent
on
cap
acity
val
ue, a
lthou
gh t
here
rem
ain
key
diff
eren
ces
in c
apac
ity
met
hod
olog
y. T
here
is s
igni
fican
tly le
ss a
gree
men
t on
ove
rall
app
roac
h to
es
timat
ing
grid
sup
por
t se
rvic
es a
nd c
urre
ntly
unm
onet
ized
val
ues
incl
udin
g fin
anci
al a
nd s
ecur
ity r
isk,
env
ironm
ent,
and
soc
ial v
alue
.
Eq
ually
imp
orta
nt, t
he q
ualifi
catio
n of
whe
ther
a fa
ctor
is a
cos
t or
ben
efit
also
diff
ers
dep
end
ing
upon
the
per
spec
tive
of t
he s
take
hold
er. S
imila
r to
the
b
asic
fram
ing
of t
estin
g co
st e
ffect
iven
ess
for
ener
gy e
ffici
ency
, the
prim
ary
stak
ehol
der
s in
cal
cula
ting
the
valu
e of
DP
V a
re: t
he p
artic
ipan
t, o
r in
thi
s ca
se, t
he s
olar
cus
tom
er; t
he u
tility
; oth
er c
usto
mer
s (a
lso
refe
rred
to
as
rate
pay
ers)
; and
soc
iety
(tax
pay
ers
are
a su
bse
t of
soc
iety
).
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 12
of 5
9
BE
NE
FIT
& C
OS
T C
ATE
GO
RIE
S
SOCI
AL
SECU
RITY
GRI
D
SERV
ICES
ENVI
RON
MEN
TAL
ENER
GY
• e
nerg
y•
ene
rgy
loss
es
CAPA
CITY
•ge
nera
tion
cap
acity
•tr
ansm
issi
on &
dis
trib
utio
n ca
pac
ity•
DP
V in
stal
led
cap
acity
GRI
D S
UPP
ORT
SER
VICE
S•
reac
tive
sup
ply
& v
olta
ge c
ontr
ol•
regu
latio
n &
freq
uenc
y re
spon
se•
ener
gy &
gen
erat
or im
bal
ance
•sy
nchr
oniz
ed &
sup
ple
men
tal o
per
atin
g re
serv
es•
sche
dul
ing,
fore
cast
ing,
and
sys
tem
con
trol
& d
isp
atch
SECU
RITY
RIS
K•
rel
iab
ility
& r
esili
ence
ENVI
RON
MEN
TAL
•ca
rbon
em
issi
ons
•cr
iteria
air
pol
luta
nts
(SO
x, N
Ox,
PM
10)
•w
ater
•la
nd
SOCI
AL
•E
cono
mic
dev
elop
men
t (jo
bs
and
tax
rev
enue
s)
13
FIN
AN
CIA
L
FIN
AN
CIA
L RI
SK•
fuel
pric
e he
dge
• m
arke
t p
rice
resp
onse
For
the
pur
pos
es o
f thi
s re
por
t, v
alue
is d
efine
d a
s ne
t va
lue,
i.e.
ben
efits
min
us c
ost
s. D
epen
din
g up
on t
he s
ize
of t
he b
enefi
t an
d t
he s
ize
of t
he c
ost,
va
lue
can
be
pos
itive
or
nega
tive.
A v
arie
ty o
f cat
egor
ies
of b
enefi
ts o
r co
sts
of D
PV
hav
e b
een
cons
ider
ed o
r ac
know
led
ged
in e
valu
atin
g th
e va
lue
of
DP
V. B
road
ly, t
hese
cat
egor
ies
are:
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 13
of 5
9
BE
NE
FIT
& C
OS
T C
ATE
GO
RIE
S D
EFI
NE
D
0.004
0.002
14
0.00
0.002
ENER
GY
Ene
rgy
valu
e of
DP
V is
pos
itive
whe
n th
e so
lar
ener
gy g
ener
ated
dis
pla
ces
the
need
to
pro
duc
e en
ergy
fr
om a
noth
er r
esou
rce
at a
net
sav
ings
. The
re a
re t
wo
prim
ary
com
pon
ents
:
•A
void
edE
nerg
y -
The
cost
and
am
ount
of e
nerg
y th
at w
ould
hav
e ot
herw
ise
bee
n ge
nera
ted
to
mee
t cu
stom
er n
eed
s, la
rgel
y d
riven
by
the
varia
ble
cos
ts o
f the
mar
gina
l res
ourc
e th
at is
d
isp
lace
d. I
n ad
diti
on t
o th
e co
inci
den
ce o
f sol
ar g
ener
atio
n w
ith d
eman
d a
nd g
ener
atio
n, k
ey
driv
ers
of a
void
ed e
nerg
y co
st in
clud
e (1
) fue
l pric
e fo
reca
st, (
2) v
aria
ble
op
erat
ion
&
mai
nten
ance
cos
ts, a
nd (3
) hea
t ra
te.
•E
nerg
y Lo
sses
- T
he v
alue
of t
he a
dd
ition
al e
nerg
y ge
nera
ted
by
cent
ral p
lant
s th
at w
ould
ot
herw
ise
be
lost
due
to
inhe
rent
inef
ficie
ncie
s (e
lect
rical
res
ista
nce)
in d
eliv
erin
g en
ergy
to
the
cust
omer
via
the
tra
nsm
issi
on a
nd d
istr
ibut
ion
syst
em. S
ince
DP
V g
ener
ates
ene
rgy
at o
r ne
ar
the
cust
omer
, tha
t ad
diti
onal
ene
rgy
is n
ot lo
st. L
osse
s ac
t as
a m
agni
fier
of v
alue
for
cap
acity
an
d e
nviro
nmen
tal b
enefi
ts, s
ince
avo
ided
ene
rgy
loss
es r
esul
t in
low
er r
equi
red
cap
acity
and
lo
wer
em
issi
ons.
GRI
D
SERV
ICES
CAPA
CITY
C
apac
ity v
alue
of D
PV
is p
ositi
ve w
hen
the
add
ition
of D
PV
def
ers
or a
void
s m
ore
inve
stm
ent
in
gene
ratio
n, t
rans
mis
sion
, and
dis
trib
utio
n as
sets
tha
n it
incu
rs. T
here
are
tw
o d
river
s p
rimar
y co
mp
onen
ts:
•G
ener
atio
n C
apac
ity
- Th
e co
st o
f the
am
ount
of c
entr
al g
ener
atio
n ca
pac
ity t
hat
can
be
def
erre
d o
f avo
ided
due
to
DP
V. K
ey d
river
s of
val
ue in
clud
e (1
) DP
V’s
effe
ctiv
e ca
pac
ity a
nd (2
) sy
stem
cap
acity
nee
ds.
•Tr
ansm
issi
on
& D
istr
ibut
ion
Cap
acit
y -
The
valu
e of
the
net
cha
nge
in T
&D
infr
astr
uctu
re
inve
stm
ent
due
to
DP
V. B
enefi
ts o
ccur
whe
n D
PV
is a
ble
to
mee
t ris
ing
dem
and
loca
lly, r
elie
ving
ca
pac
ity c
onst
rain
ts u
pst
ream
and
def
errin
g or
avo
idin
g T&
D u
pgr
ades
. Cos
ts o
ccur
whe
n ad
diti
onal
T&
D in
vest
men
t is
nee
ded
to
sup
por
t th
e ad
diti
on o
f DP
V.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 14
of 5
9
0.004
0.002
15
0.004
0.002
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0.002
0.002
GRI
D
SERV
ICES
GRI
D S
UPP
ORT
SER
VICE
SG
rid s
upp
ort
valu
e of
DP
V is
pos
itive
whe
n th
e ne
t am
ount
and
cos
t of
grid
sup
por
t se
rvic
es r
equi
red
to b
alan
ce s
upp
ly a
nd d
eman
d is
dec
reas
ed t
han
wou
ld o
ther
wis
e ha
ve b
een
req
uire
d. G
rid s
upp
ort
serv
ices
, whi
ch e
ncom
pas
s m
ore
narr
owly
defi
ned
anc
illar
y se
rvic
es (A
S),
are
thos
e se
rvic
es r
equi
red
to
ena
ble
the
rel
iab
le o
per
atio
n of
inte
rcon
nect
ed e
lect
ric g
rid s
yste
ms.
Grid
sup
por
t se
rvic
es
incl
ude:
•Rea
ctiv
e su
pp
ly a
nd v
olt
age
cont
rol—
Usi
ng g
ener
atin
g fa
cilit
ies
to s
upp
ly r
eact
ive
pow
er a
nd
volta
ge c
ontr
ol.
•Fre
que
ncy
reg
ulat
ion—
Con
trol
eq
uip
men
t an
d e
xtra
gen
erat
ing
cap
acity
nec
essa
ry t
o (1
) m
aint
ain
freq
uenc
y b
y fo
llow
ing
the
mom
ent-
to-m
omen
t va
riatio
ns in
con
trol
are
a lo
ad
(sup
ply
ing
pow
er t
o m
eet
any
diff
eren
ce in
act
ual a
nd s
ched
uled
gen
erat
ion)
, and
(2) t
o re
spon
d
auto
mat
ical
ly t
o fr
eque
ncy
dev
iatio
ns in
the
ir ne
twor
ks. W
hile
the
ser
vice
s p
rovi
ded
by
Reg
ulat
ion
Ser
vice
and
Fre
que
ncy
Res
pon
se S
ervi
ce a
re d
iffer
ent,
the
y ar
e co
mp
lem
enta
ry
serv
ices
mad
e av
aila
ble
usi
ng t
he s
ame
equi
pm
ent
and
are
offe
red
as
par
t of
one
ser
vice
.
•Ene
rgy
imb
alan
ce—
This
ser
vice
sup
plie
s an
y ho
urly
net
mis
mat
ch b
etw
een
sche
dul
ed e
nerg
y su
pp
ly a
nd t
he a
ctua
l loa
d s
erve
d.
•Op
erat
ing
res
erve
s—S
pin
ning
res
erve
is p
rovi
ded
by
gene
ratin
g un
its t
hat
are
on-l
ine
and
lo
aded
at
less
tha
n m
axim
um o
utp
ut, a
nd s
houl
d b
e lo
cate
d n
ear
the
load
(typ
ical
ly in
the
sam
e co
ntro
l are
a). T
hey
are
avai
lab
le t
o se
rve
load
imm
edia
tely
in a
n un
exp
ecte
d c
ontin
genc
y.
Sup
ple
men
tal r
eser
ve is
gen
erat
ing
cap
acity
use
d t
o re
spon
d t
o co
ntin
genc
y si
tuat
ions
tha
t is
no
t av
aila
ble
inst
anta
neou
sly,
but
rat
her
with
in a
sho
rt p
erio
d, a
nd s
houl
d b
e lo
cate
d n
ear
the
load
(typ
ical
ly in
the
sam
e co
ntro
l are
a).
•Sch
edul
ing
/fo
reca
stin
g—
Inte
rcha
nge
sche
dul
e co
nfirm
atio
n an
d im
ple
men
tatio
n w
ith o
ther
co
ntro
l are
as, a
nd a
ctio
ns t
o en
sure
op
erat
iona
l sec
urity
dur
ing
the
tran
sact
ion.
BE
NE
FIT
& C
OS
T C
ATE
GO
RIE
S D
EFI
NE
DU
-173
02 E
LPC
/Rab
ago
Exh
ibit
KR
R-3
Pag
e 15
of 5
9
0.004
0.002
16
0.004
0.002
0.000.00
0.002
0.002
FIN
AN
CIA
L RI
SKFi
nanc
ial v
alue
of D
PV
is p
ositi
ve w
hen
finan
cial
ris
k or
ove
rall
mar
ket
pric
e is
red
uced
due
to
th
e ad
diti
on o
f DP
V. T
here
are
tw
o co
mp
onen
ts o
f fina
ncia
l val
ue:
•Fu
el P
rice
Hed
ge
- Th
e co
st t
hat
a ut
ility
wou
ld o
ther
wis
e in
cur
to g
uara
ntee
tha
t a
por
tion
of e
lect
ricity
sup
ply
-cos
ts a
re fi
xed
.
•M
arke
t P
rice
Res
po
nse
- Th
e p
rice
imp
act
as a
res
ult
of D
PV
’s r
educ
ing
dem
and
for
cent
rally
-sup
plie
d e
lect
ricity
and
the
fuel
pow
er t
hose
gen
erat
ors,
the
reb
y lo
wer
ing
elec
tric
ity p
rices
and
pot
entia
lly c
omm
odity
pric
es.
SECU
RITY
RIS
K
CAT
EG
OR
IES
DE
FIN
ED
FIN
AN
CIA
L
SECU
RITY
Sec
urity
val
ue o
f DP
V is
pos
itive
whe
n gr
id r
elia
bili
ty a
nd r
esili
ency
are
incr
ease
d b
y (1
) re
duc
ing
outa
ges
by
red
ucin
g co
nges
tion
alon
g th
e T&
D n
etw
ork,
(2) r
educ
ing
larg
e-sc
ale
outa
ges
by
incr
easi
ng t
he d
iver
sity
of t
he e
lect
ricity
sys
tem
’s g
ener
atio
n p
ortf
olio
with
sm
alle
r ge
nera
tors
tha
t ar
e ge
ogra
phi
cally
dis
per
sed
, and
(3) p
rovi
din
g b
ack-
up p
ower
so
urce
s av
aila
ble
dur
ing
outa
ges
thro
ugh
the
com
bin
atio
n of
PV,
con
trol
tec
hnol
ogie
s,
inve
rter
s an
d s
tora
ge.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 16
of 5
9
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0.002
17
0.00
0.002
ENVI
RON
MEN
TAL
SOCI
AL
Env
ironm
enta
l val
ue o
f DP
V is
pos
itive
whe
n D
PV
res
ults
in t
he r
educ
tion
of e
nviro
nmen
tal o
r he
alth
imp
acts
tha
t w
ould
oth
erw
ise
have
bee
n cr
eate
d. K
ey d
river
s in
clud
e p
rimar
ily t
he
envi
ronm
enta
l im
pac
ts o
f the
mar
gina
l res
ourc
e b
eing
dis
pla
ced
. The
re a
re fo
ur c
omp
onen
ts o
f en
viro
nmen
tal v
alue
:
•C
arb
on
- T
he v
alue
from
red
ucin
g ca
rbon
em
issi
ons
is d
riven
the
em
issi
on in
tens
ity o
f d
isp
lace
d m
argi
nal r
esou
rce
and
the
pric
e of
em
issi
ons.
•C
rite
ria
Air
Po
lluta
nts
- Th
e va
lue
from
red
ucin
g cr
iteria
air
pol
luta
nt e
mis
sion
s—N
OX
, S
O2,
and
par
ticul
ate
mat
ter—
is d
riven
by
the
cost
of a
bat
emen
t te
chno
logi
es, t
he m
arke
t va
lue
of p
ollu
tant
red
uctio
ns, a
nd/o
r th
e co
st o
f hum
an h
ealth
dam
ages
.
•W
ater
- T
he v
alue
from
red
ucin
g w
ater
use
is d
riven
by
the
diff
erin
g w
ater
con
sum
ptio
n p
atte
rns
asso
ciat
ed w
ith d
iffer
ent
gene
ratio
n te
chno
logi
es, a
nd c
an b
e m
easu
red
by
the
pric
e p
aid
for
wat
er in
com
pet
ing
sect
ors.
•La
nd -
The
val
ue a
ssoc
iate
d w
ith la
nd is
driv
en b
y th
e d
iffer
ence
in t
he la
nd fo
otp
rint
req
uire
d fo
r en
ergy
gen
erat
ion
and
any
cha
nge
in p
rop
erty
val
ue d
riven
by
the
add
ition
of
DP
V.
CAT
EG
OR
IES
DE
FIN
ED
Soc
ial v
alue
of D
PV
is p
ositi
ve w
hen
DP
V r
esul
ts in
a n
et in
crea
se in
job
s an
d lo
cal e
cono
mic
d
evel
opm
ent.
Key
driv
ers
incl
ude
the
num
ber
of j
obs
crea
ted
or
dis
pla
ced
, as
mea
sure
d b
y a
job
mul
tiplie
r, as
wel
l as
the
valu
e of
eac
h jo
b, a
s m
easu
red
by
aver
age
sala
ry a
nd/o
r ta
x re
venu
e.
ENVI
RON
MEN
TAL
SOCI
AL
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 17
of 5
9
FLO
W O
F B
EN
EFI
TS A
ND
CO
STS
AV
OID
ED
CO
ST
SA
VIN
GS
TO
TAL
RE
SO
UR
CE
CO
ST
OTH
ER
CU
STO
ME
RS
SO
LAR
CU
STO
ME
RS
SO
LAR
PR
OV
IDE
R
PV
Cos
t$
EN
VIR
ON
ME
NTA
L B
EN
EFI
TS
ELE
CTR
ICG
RID
SO
CIE
TAL
CO
ST
UT
ILIT
YC
OS
T
$
$$
RAT
E IM
PAC
T
PA
RT
ICIP
AN
T C
OS
T$
INTE
GR
ATIO
N &
I NTE
RC
ON
NE
CTI
ON
C
OS
TS
INC
EN
TIV
E,
BIL
LS
AV
ING
S
LOS
TR
EV
EN
UE,
UTI
LITY
NE
TC
OS
T
18
SO
CIA
LB
EN
EFI
TS
BE
NE
FITS
AN
D C
OS
TS A
CC
RU
E T
O D
IFFE
RE
NT
STA
KE
HO
LDE
RS
IN T
HE
SY
STE
M
Pho
tos
cour
tesy
of S
hutt
erst
ock
The
Cal
iforn
ia S
tand
ard
Pra
ctic
e M
anua
l est
ablis
hed
the
gen
eral
sta
ndar
d fo
r ev
alua
ting
the
flow
of
ben
efits
and
cos
ts a
mon
g st
akeh
old
ers.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 18
of 5
9
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
stak
ehho
lder
per
spec
tive
fact
ors
aff
ecti
ng v
alue
“I w
ant
to h
ave
a p
red
icta
ble
re
turn
on
my
inve
stm
ent,
and
I w
ant
to b
e co
mp
ensa
ted
for
ben
efits
I p
rovi
de.
”
Ben
efits
incl
ude
the
red
uctio
n in
the
cus
tom
er’s
util
ity b
ill, a
ny in
cent
ive
pai
d b
y th
e ut
ility
or
othe
r th
ird p
artie
s, a
nd a
ny fe
der
al, s
tate
, or
loca
l tax
cre
dit
rece
ived
. Cos
ts
incl
ude
cost
of t
he e
qui
pm
ent
and
mat
eria
ls p
urch
ased
(inc
. tax
& in
stal
latio
n), o
ngoi
ng
O&
M, r
emov
al c
osts
, and
the
cus
tom
er’s
tim
e in
arr
angi
ng t
he in
stal
latio
n.
“I w
ant
relia
ble
pow
er a
t lo
wes
t co
st.”
Ben
efits
incl
ude
red
uctio
n in
tra
nsm
issi
on, d
istr
ibut
ion,
and
gen
erat
ion,
cap
acity
cos
ts;
ener
gy c
osts
and
grid
sup
por
t se
rvic
es. C
osts
incl
ude
adm
inis
trat
ive
cost
s, r
ebat
es/
ince
ntiv
es, a
nd d
ecre
ased
util
ity r
even
ue t
hat
is o
ffset
by
incr
ease
d r
ates
.
“I w
ant
to s
erve
my
cust
omer
s re
liab
ly a
nd s
afel
y at
the
low
est
cost
, pro
vid
e sh
areh
old
er v
alue
an
d m
eet
regu
lato
ry
req
uire
men
ts.”
Ben
efits
incl
ude
red
uctio
n in
tra
nsm
issi
on, d
istr
ibut
ion,
and
gen
erat
ion,
cap
acity
cos
ts;
ener
gy c
osts
and
grid
sup
por
t se
rvic
es.
Cos
ts in
clud
e ad
min
istr
ativ
e co
sts,
reb
ates
/in
cent
ives
, and
dec
reas
ed r
even
ue.
“We
wan
t im
pro
ved
air/
wat
er
qua
lity
as w
ell a
s an
imp
rove
d
econ
omy.
”
The
sum
of t
he b
enefi
ts a
nd c
osts
to
all s
take
hold
er, p
lus
any
add
ition
al b
enefi
ts o
r co
sts
that
acc
rue
to s
ocie
ty a
t la
rge
rath
er t
han
any
ind
ivid
ual s
take
hold
er. P
hoto
s co
urte
sy o
f Shu
tter
stoc
k19
UT
ILIT
Y
PV
CU
ST
OM
ER
OT
HE
R
CU
ST
OM
ER
S
SO
CIE
TY
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 19
of 5
9
anal
ysis
ove
rvie
w
sum
mar
y of
ben
efits
and
cos
ts
det
ail:
cate
gorie
s of
ben
efit
and
cos
t
03AN
ALY
SIS
FIN
DIN
GS
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 20
of 5
9
AN
ALY
SIS
OV
ER
VIE
WTH
IS A
NA
LYS
IS IN
CLU
DE
S 1
5 S
TUD
IES
, RE
FLE
CTI
NG
DIV
ER
SE
DP
V P
EN
ETR
ATIO
N
LEV
ELS
AN
D A
NA
LYTI
CA
L G
RA
NU
LAR
ITY
LOW
LE
VE
L O
F G
RA
NU
LAR
ITY
IN
ST
UD
Y A
NA
LYS
IS(fo
r ex
amp
le, s
econ
dar
y an
alys
is, n
o ho
urly
m
odel
ing,
no
feed
er s
pec
ific
mod
elin
g)
ST
UD
Y F
OC
US
ES
ON
C
OS
TS
/BE
NE
FIT
S A
T
LOW
SO
LAR
P
EN
ET
RAT
ION
LE
VE
LS
HIG
H L
EV
EL
OF
GR
AN
ULA
RIT
Y IN
S
TU
DY
AN
ALY
SIS
(for
exa
mp
le, d
etai
led
mod
elin
g, h
ourly
, fe
eder
leve
l)
MID
LE
VE
L
E3
2012
AE
/CP
R 2
006
AP
S 2
009
CP
R (N
J/PA
) 201
2
Cro
ssb
ord
er (C
A)
2013
AE
/CP
R 2
012
LBN
L 20
12
ST
UD
Y F
OC
US
ES
ON
C
OS
TS
/BE
NE
FIT
S A
T
HIG
H S
OLA
R
PE
NE
TR
ATIO
N L
EV
ELS
CP
R (T
X) 2
013
CP
R (N
Y) 2
008
NR
EL
2008
Vote
Sol
ar 2
005
R. D
uke
2005
Cro
ssb
ord
er (A
Z)
2013
AP
S 2
013
21
[0%
-16
% a
nnua
l ene
rgy
(MW
h) b
y 20
25; T
&D
ev
alua
ted
at
feed
er le
vel]
[1.1
%, 2
.2%
pea
k lo
ad
(MW
)]
[5%
pea
k lo
ad (M
W)]
[15%
util
ity p
eak
load
(MW
)]
[<40
% a
nnua
l ene
rgy
(M
Wh)
]
[15%
, 30%
pea
k (M
W)]
[uns
pec
ified
pen
etra
tion
leve
ll]
[ap
pro
x. 1
%, 2
.5%
pea
k lo
ad (M
W)]
[2%
- 2
0% a
nnua
l en
ergy
(MW
h)]
E3
2011
[<1%
pea
k (M
W)]
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 21
of 5
9
SU
MM
AR
Y O
F D
PV
BE
NE
FITS
AN
D C
OS
TS
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NE
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ST
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S20
13A
PS
2009
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ss-
bor
der
(A
Z)
2013
Cro
ss-
bor
der
(C
A)
2013
E3
2012
**Vo
te
Sol
ar20
05
R. D
uke
2005
LBN
L20
12*
CP
R(N
J/PA
) 20
12
CP
R(T
X)
2013
AE
/C
PR
2012
AE
/C
PR
2006
NR
EL
2008
***
CP
R(N
Y)
2008
Ene
rgy
Gen
Cap
acity
T&D
Cap
acity
Loss
es
Mo
neti
zed
Sol
ar P
enet
ratio
n C
ost
DP
V T
echn
olog
yG
rid S
upp
ort
Ser
vice
s
Avo
ided
Ren
ewab
les
Inco
nsis
tent
ly U
nmo
neti
zed
INS
IGH
TS
•N
o st
udy
com
pre
hens
ivel
y ev
alua
ted
the
b
enefi
ts a
nd c
osts
of D
PV,
alth
ough
man
y ac
know
led
ge a
dd
ition
al s
ourc
es o
f ben
efit
or
cost
and
man
y ag
ree
on t
he b
road
cat
egor
ies
of b
enefi
t an
d c
ost.
Ther
e is
a s
igni
fican
t ra
nge
of e
stim
ated
val
ue
acro
ss s
tud
ies,
driv
en p
rimar
ily b
y d
iffer
ence
s in
loca
l con
text
, inp
ut a
ssum
ptio
ns, a
nd
met
hod
olog
ical
ap
pro
ache
s.
Bec
ause
of t
hese
diff
eren
ces,
com
par
ing
resu
lts a
cros
s st
udie
s ca
n b
e in
form
ativ
e, b
ut
shou
ld b
e d
one
with
the
und
erst
and
ing
that
re
sults
mus
t b
e no
rmal
ized
for
cont
ext,
as
sum
ptio
ns, o
r m
etho
dol
ogy.
Whi
le d
etai
led
met
hod
olog
ical
diff
eren
ces
abou
nd, t
here
is s
ome
agre
emen
t on
ove
rall
app
roac
h to
est
imat
ing
ener
gy a
nd c
apac
ity
valu
e. T
here
is s
igni
fican
tly le
ss a
gree
men
t on
ov
eral
l ap
pro
ach
to e
stim
atin
g gr
id s
upp
ort
serv
ices
and
cur
rent
ly u
nmon
etiz
ed v
alue
s in
clud
ing
finan
cial
and
sec
urity
ris
k,
envi
ronm
ent,
and
soc
ial v
alue
.
Cus
tom
er S
ervi
ces
Env
: Uns
pec
ified
Soc
ial
Fina
ncia
l: Fu
el P
rice
Hed
ge
Env
: Car
bon
Sec
urity
Ris
kFi
nanc
ial:
Mkt
Pric
e R
esp
onse
Env
: Crit
eria
Air
Pol
luta
nts
Ave
rage
Loc
al R
etai
l Rat
e***
*(in
yea
r of
stu
dy
per
EIA
)
AP
S20
13A
PS
2009
-C
ross
r b
ord
e(A
Z)
2013
CP
R(N
J/PA
)20
12
CP
R(N
Y)
2008
CP
R(T
X)
2013
AE
/C
PR
2012
AE
/C
PR
2006
Cro
ss-
bor
der
(CA
)20
13
E3
2012
**Vo
te
Sol
ar20
05
R. D
uke
2005
LBN
L20
12*
NNR
EL
20008
***
Ariz
ona
NY,
NJ,
PN
Texa
sN
/AC
alifo
rnia
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 22
of 5
9
BE
NE
FIT
ES
TIM
ATE
SR
AN
GE
IN B
EN
EFI
T E
STI
MAT
ES
AC
RO
SS
STU
DIE
S D
RIV
EN
BY
VA
RIA
TIO
N IN
SY
STE
M C
ON
TEX
T, IN
PU
T A
SS
UM
PTI
ON
S, A
ND
ME
THO
DO
LOG
IES
02
46
810
12
VALU
E (c
ents
/kW
h) in
$20
12
PU
BLI
SH
ED
AV
ER
AG
EB
EN
EF
ITE
ST
IMAT
ES
*
*For
the
full
rang
e of
val
ues
obse
rved
see
the
ind
ivid
ual m
etho
dol
ogy
slid
es.
AE
/CP
R
2006
Vote
S
olar
2005
NR
EL
2008
E3
2012
Cro
ss-
bor
der
(C
A)
2013
R. D
uke
2005
AE
/CP
R
2012
NR
EL
2008
CP
R (N
J/
PA) 2
012
AE
/C
PR
2012
LBN
L20
12
CP
R(N
J/ P
A)
2012
E3
2012
NR
EL
2008
AP
S20
09
AE
/C
PR
2006
Vote
Sol
ar
2005
Cro
ss-
bor
der
(C
A)
2013
R. D
uke
2005
CP
R(T
X)
2013
CP
R(N
Y)
2008
AP
S20
13
Cro
ssb
ord
er
(AZ
)20
13E
NE
RG
Y
GE
NE
RAT
ION
C
APA
CIT
Y
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CA
PAC
ITY
GR
ID S
UP
PO
RT
SE
RV
ICE
S
GE
NE
RA
LE
NV
IRO
NM
EN
TAL
SY
STE
M L
OS
SE
S
SE
CU
RIT
Y
HE
DG
E
SO
CIA
L
CA
RB
ON
MA
RK
ET
PR
ICE
R
ES
PO
NS
E
CR
ITE
RIA
AIR
P
OLL
UTA
NTS
NR
EL
2008
CP
R (N
J/PA
) 201
2
NR
EL
2008
CP
R (N
J/
PA) 2
012
R. D
uke
2005
CP
R (T
X)
2013
NR
EL
2008
CP
R (N
J/
PA) 2
012
AE
/CP
R20
06Vo
te S
olar
, 20
05
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/CP
R20
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ross
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der
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Z) 2
013
CP
R (N
J/PA
), 20
12
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R(T
X)
2013
R. D
uke
2005
NR
EL
2008
E3
2012
R. D
uke
2005
NR
EL
2008
Cro
ssb
ord
er
(CA
) 201
3
NR
EL
2008
E3
2012
Cro
ss-
bor
der
(C
A)
2013
Cro
ss-
bor
der
(A
Z)
2013
NR
EL
2008
Vote
Sol
ar
2005
Cro
ssb
ord
er
(AZ
) 201
3C
ross
-b
ord
er
(CA
) 201
3
E3
2012
AE
/CP
R20
12
AE
/C
PR
2006
AP
S20
13
CP
R(N
J/PA
) 20
12A
PS
200
9C
PR
(TX
) 201
3
CP
R (N
J/PA
) 201
2A
PS
2009
NR
EL
2008
CP
R (N
Y)
2008
Vote
Sol
ar
2005
Cro
ssb
ord
er
(CA
) 201
3
AP
S20
13C
ross
bor
der
(A
Z) 2
013
AE
/CP
R20
12
AE
/C
PR
2006
CP
R(T
X)
2013
LBN
L20
12E
3 20
12R
. Duk
e 20
05
Ran
ge d
riven
b
y na
tura
l gas
p
rices
Loss
es a
re s
omet
imes
sep
arat
e an
d s
omet
imes
m
agni
fy e
nerg
y, c
apac
ity, a
nd e
nviro
nmen
tal v
alue
s
Ran
ge d
riven
by
effe
ctiv
e ca
pac
ity
of D
PV
and
cap
acity
nee
ds
Ran
ge d
riven
by
asse
ssm
ent
of D
PV
’s
abili
ty t
o d
efer
pla
nned
inve
stm
ent
Mos
t st
udie
s p
lace
a v
ery
low
va
lue
on P
V’s
ab
ility
to
pro
vid
e A
S Ran
ge b
ased
on
the
assu
mp
tion
that
na
tura
l gas
is t
he m
argi
nal f
uel s
ourc
e;
Valu
e is
muc
h hi
gher
for
coal
Stu
die
s sp
lit in
met
hod
olog
y b
etw
een
miti
gatio
n co
st a
nd
heal
th d
amag
es
Som
e st
udie
s gr
oup
ed a
ir, w
ater
, la
nd, a
nd o
ther
env
ironm
enta
l im
pac
ts
Ran
ge d
riven
by
assu
mp
tions
ab
out
natu
ral g
as p
rice
vola
tility
Ran
ge d
riven
by
assu
mp
tions
ab
out
the
exte
nt o
f nat
ural
gas
pric
e im
pac
ts a
cros
s th
e m
arke
t
Ran
ge d
riven
by
the
valu
e of
re
duc
ing
pow
er in
terr
uptio
ns
Ran
ge b
ased
on
assu
mp
tion
that
DP
V
rela
ted
job
s ar
e hi
gher
in q
ualit
y &
qua
ntity
th
an t
rad
ition
al e
nerg
y se
ctor
job
s
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 23
of 5
9
05
1015
2025
3035
40
VALU
E (c
ents
/kW
h) in
$20
12
CO
ST
ES
TIM
ATE
SC
OS
TS A
SS
OC
IATE
D W
ITH
INC
RE
AS
ED
DP
V D
EP
LOY
ME
NT
AR
E N
OT
AD
EQ
UAT
ELY
AS
SE
SS
ED
Oth
er s
tud
ies
(for
exam
ple
E3
2011
) inc
lud
e co
sts,
but
res
ults
are
not
pre
sent
ed in
div
idua
lly in
the
stu
die
s an
d s
o no
t in
clud
ed in
the
ch
art
abov
e. C
osts
gen
eral
ly in
clud
e co
sts
of p
rogr
am r
ebat
es o
r in
cent
ives
pai
d b
y th
e ut
ility
, pro
gram
ad
min
istr
atio
n co
sts,
lost
re
venu
e to
the
util
ity, s
tran
ded
ass
ets,
and
cos
ts a
nd in
effic
ienc
ies
asso
ciat
ed w
ith t
hrot
tling
dow
n ex
istin
g p
lant
s.24
PU
BLI
SH
ED
AV
ER
AG
EC
OS
TVA
LUE
SF
OR
RE
VIE
WE
DS
OU
RC
ES
GR
ID S
UP
PO
RT
SE
RV
ICE
S
SO
LAR
PE
NE
TRAT
ION
CO
ST
DP
VTE
CH
NO
LOG
Y
LBN
L 20
12
E3
2012
E3
2012
NR
EL
2008
Cro
ssb
ord
er (A
Z) 2
013
CP
R (N
J/P
N) 2
012
Incl
udes
DP
V
syst
em h
ard
war
e;
inst
alla
tion,
per
mitt
ing,
and
ot
her
soft
cos
ts;
and
O&
MA
ncill
ary
serv
ices
req
uire
d b
y th
e sy
stem
, suc
h as
op
erat
ing
rese
rves
, vol
tage
con
trol
, fre
que
ncy
regu
latio
n, e
nerg
y b
alan
cing
, and
sch
edul
ing
/ fo
reca
stin
g se
rvic
es
All
rele
vant
cos
ts, i
nclu
din
g “i
nfra
stru
ctur
e an
d
oper
atio
nal e
xpen
se n
eces
sary
to
man
age
flow
of
non-
cont
rolla
ble
sol
ar e
nerg
y ge
nera
tion
whi
le
cont
inui
ng t
o re
liab
ly m
eet
dem
and
.”
Incl
udes
lost
ret
ail r
ate
reve
nues
; DG
in
cent
ives
; and
inte
grat
ion
cost
s
COST
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 24
of 5
9
EN
ER
GY
VALU
E O
VE
RV
IEW
Ene
rgy
valu
e is
cre
ated
whe
n D
PV
gen
erat
es e
nerg
y (k
Wh)
tha
t d
isp
lace
s th
e ne
ed t
o p
rod
uce
ener
gy fr
om a
noth
er
reso
urce
. The
re a
re t
wo
com
pon
ents
of e
nerg
y va
lue:
the
am
ount
of e
nerg
y th
at w
ould
hav
e b
een
gene
rate
d e
qua
l to
the
DP
V g
ener
atio
n, a
nd t
he a
dd
ition
al e
nerg
y th
at w
ould
hav
e b
een
gene
rate
d b
ut lo
st in
del
iver
y d
ue t
o in
here
nt
inef
ficie
ncie
s in
the
tra
nsm
issi
on a
nd d
istr
ibut
ion
syst
em.
AP
PR
OA
CH
OV
ER
VIE
WTh
ere
is b
road
agr
eem
ent
on t
he g
ener
al a
pp
roac
h to
cal
cula
ting
ener
gy v
alue
, alth
ough
num
erou
s d
iffer
ence
s in
m
etho
dol
ogic
al d
etai
ls. E
nerg
y is
freq
uent
ly t
he m
ost
sign
ifica
nt s
ourc
e of
ben
efit.
• E
nerg
y va
lue
is t
he a
void
ed c
ost
of t
he m
argi
nal r
esou
rce,
gen
eral
ly a
ssum
ed t
o b
e na
tura
l gas
.•
Key
ass
ump
tions
gen
eral
ly in
clud
e fu
el p
rice
fore
cast
, op
erat
ing
& m
aint
enan
ce c
osts
, and
hea
t ra
te, a
nd
dep
end
ing
on t
he s
tud
y, c
an in
clud
e lin
e lo
sses
and
a c
arb
on p
rice.
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•M
arke
t st
ruct
ure
- S
ome
ISO
s an
d s
tate
s va
lue
cap
acity
and
ene
rgy
sep
arat
ely,
whe
reas
som
e IS
Os
only
ha
ve e
nerg
y m
arke
ts b
ut n
o ca
pac
ity m
arke
ts. I
SO
s w
ith o
nly
ener
gy m
arke
ts m
ay r
eflec
t ca
pac
ity v
alue
in
the
ener
gy p
rice.
•M
arg
inal
res
our
ce -
Reg
ions
with
ISO
s m
ay c
alcu
late
the
mar
gina
l pric
e b
ased
on
who
lesa
le m
arke
t p
rices
, ra
ther
tha
n on
the
cos
t of
the
mar
gina
l pow
er p
lant
; diff
eren
t re
sour
ces
may
be
on t
he m
argi
n in
diff
eren
t re
gion
s or
with
diff
eren
t so
lar
pen
etra
tions
.•
Inp
ut A
ssum
pti
ons
:
•Fu
el p
rice
fo
reca
st -
Sin
ce g
as is
usu
ally
on
the
mar
gin,
mos
t st
udie
s fo
cus
on g
as p
rices
. Stu
die
s m
ost
ofte
n b
ase
natu
ral g
as p
rices
on
the
NY
ME
X fo
rwar
d m
arke
t an
d t
hen
extr
apol
ate
to s
ome
futu
re d
ate
(var
ied
ap
pro
ache
s to
thi
s ex
trap
olat
ion)
, but
som
e ta
ke a
diff
eren
t ap
pro
ach
to fo
reca
stin
g, fo
r ex
amp
le, b
ased
on
Ene
rgy
Info
rmat
ion
Ad
min
istr
atio
n p
roje
ctio
ns.
•P
ow
er p
lant
effi
cien
cy -
The
effi
cien
cy o
f the
mar
gina
l res
ourc
e si
gnifi
cant
ly im
pac
ts e
nerg
y va
lue;
stu
die
s sh
ow a
wid
e ra
nge
of a
ssum
ed n
atur
al g
as p
lant
hea
t ra
tes.
•Va
riab
le o
per
atin
g &
mai
nten
ance
co
sts
- W
hile
the
re is
som
e d
iffer
ence
in v
alue
s as
sum
ed b
y st
udie
s,
varia
ble
O&
M c
osts
are
gen
eral
ly lo
w.
•C
arb
on
pri
ce -
Som
e st
udie
s in
clud
e an
est
imat
ed c
arb
on p
rice
in e
nerg
y va
lue,
oth
ers
acco
unt
for
it se
par
atel
y, a
nd o
ther
s d
o no
t in
clud
e it
at a
ll.•
Met
hod
olo
gie
s:
•S
tud
y w
ind
ow
- S
ome
stud
ies
(for
exam
ple
, AP
S 2
013)
cal
cula
te e
nerg
y va
lue
in a
sam
ple
yea
r, w
here
as
othe
rs (f
or e
xam
ple
, Cro
ssb
ord
er (A
Z) 2
013)
cal
cula
te e
nerg
y va
lue
as a
leve
lized
cos
t ov
er 2
0 ye
ars.
•Le
vel o
f g
ranu
lari
ty/w
hat’s
on
the
mar
gin
- S
tud
ies
take
one
of t
hree
gen
eral
ap
pro
ache
s: (1
) DP
V
dis
pla
ces
ener
gy fr
om a
gas
pla
nt, g
ener
ally
a c
omb
ined
cyc
le, (
2) D
PV
dis
pla
ces
ener
gy fr
om o
ne t
ype
of
pla
nt (g
ener
ally
a c
omb
ined
cyc
le) o
ff-p
eak
and
a d
iffer
ent
typ
e of
pla
nt (g
ener
ally
a c
omb
ustio
n tu
rbin
e) o
n-p
eak,
(3) D
PV
dis
pla
ces
the
reso
urce
on
the
mar
gin
dur
ing
ever
y ho
ur o
f the
yea
r, b
ased
on
a d
isp
atch
an
alys
is.
BE
NE
FIT
AN
D C
OS
T E
ST
IMAT
ES
AS
RE
PO
RT
ED
BY
RE
VIE
WE
D S
TU
DIE
S
25
* =
val
ue in
clud
es lo
sses
05
1015
AP
S 2
013*
Cro
ssb
ord
er (A
Z) 2
013*
CP
R (T
X) 2
013*
Cro
ssb
ord
er (C
A) 2
013
AE
/CP
R 2
012*
CP
R (N
J/PA
) 201
2*
LBN
L 20
12
E3
2012
AP
S 2
009*
NR
EL
2008
CP
R (N
Y) 2
008
AE
/CP
R 2
006*
Vote
Sol
ar 2
005
R. D
uke
2005
(cen
ts/k
Wh
2012
)
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 25
of 5
9
SE
NS
ITIV
ITIE
S T
O M
AIN
DR
IVE
RS
EN
ER
GY
(CO
NT’
D)
0
3.757.5
11.2
515
02
46
810
Nat
ural
Gas
Cos
t fo
r P
ower
Pla
nts
(cen
ts/M
btu
)
Ele
ctri
c G
ener
atio
n:
Nat
ural
Gas
Co
st S
ensi
tivity
Hea
t R
ate
7,00
0 B
tu/k
Wh
9,05
0 B
tu/k
Wh
11,1
00 B
tu/k
Wh
Value of Wholesale Energy (cents/kWh $2012)
26
INS
IGH
TS
& IM
PLI
CAT
ION
S
• A
ccur
atel
y d
efini
ng t
he m
argi
nal r
esou
rce
that
DP
V d
isp
lace
s re
qui
res
an in
crea
sing
ly s
ophi
stic
ated
ap
pro
ach
as D
PV
pen
etra
tion
incr
ease
s.
• Ta
king
a m
ore
gran
ular
ap
pro
ach
to d
eter
min
ing
ener
gy v
alue
als
o re
qui
res
a m
ore
det
aile
d
char
acte
rizat
ion
of D
PV
’s g
ener
atio
n p
rofil
e. It
’s a
lso
criti
cal t
o us
e so
lar
and
load
pro
files
from
the
sam
e ye
ar(s
), to
acc
urat
ely
refle
ct w
eath
er d
river
s an
d t
here
fore
gen
erat
ion
and
dem
and
cor
rela
tion.
• In
cas
es w
here
DP
V is
dis
pla
cing
nat
ural
gas
, the
NY
ME
X n
atur
al g
as fo
rwar
d m
arke
t is
a r
easo
nab
le
bas
is fo
r a
natu
ral g
as p
rice
fore
cast
, ad
just
ed a
pp
rop
riate
ly fo
r d
eliv
ery
to t
he r
egio
n in
que
stio
n. It
is n
ot
app
aren
t fr
om s
tud
ies
revi
ewed
wha
t th
e m
ost
effe
ctiv
e m
etho
d is
for
esca
latin
g p
rices
bey
ond
the
yea
r in
w
hich
the
NY
ME
X m
arke
t en
ds.
Mar
gin
al R
eso
urc
e
Ch
arac
teri
zati
on
Pro
sC
on
s
Sing
le p
ower
pla
nt a
ssum
ed t
o be
on
the
mar
gin
(typ
ical
ly g
as C
C)
Sim
ple;
oft
en s
uffic
ient
ly a
ccur
ate
at lo
w s
olar
pe
netr
atio
nsN
ot n
eces
sari
ly a
ccur
ate
at h
ighe
r pe
netr
atio
ns o
r in
all
juri
sdic
tions
Plan
t on
the
mar
gin
on-p
eak/
plan
t on
the
mar
gin
off-p
eak
Mor
e ac
cura
tely
cap
ture
s di
ffere
nces
in
ener
gy v
alue
refl
ecte
d in
mer
it-or
der
disp
atch
Not
nec
essa
rily
acc
urat
e at
hig
her
pene
trat
ions
or
in a
ll ju
risd
ictio
ns
Hou
rly
disp
atch
or
mar
ket
asse
ssm
ent
to d
eter
min
e m
argi
nal
reso
urce
in e
very
hou
r
Mos
t ac
cura
te, e
spec
ially
with
incr
easi
ng
pene
trat
ion
Mor
e co
mpl
ex a
naly
sis
requ
ired
; sol
ar
shap
e an
d lo
ad s
hape
mus
t be
from
sam
e ye
ars
Wha
t D
PV
dis
pla
ces
dep
end
s on
the
d
isp
atch
ord
er o
f oth
er r
esou
rces
, whe
n th
e so
lar
is g
ener
ated
, and
how
muc
h is
ge
nera
ted
.
More accurate, more complex LOO
KIN
G F
OR
WA
RD
As
rene
wab
le a
nd d
istr
ibut
ed r
esou
rce
(not
just
DP
V) p
enet
ratio
n in
crea
ses,
tho
se r
esou
rces
will
sta
rt t
o im
pac
t th
e un
der
lyin
g lo
ad s
hap
e d
iffer
ently
, req
uirin
g m
ore
gran
ular
ana
lysi
s to
det
erm
ine
ener
gy v
alue
.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 26
of 5
9
SY
STE
M L
OS
SE
S
VALU
E O
VE
RV
IEW
Ene
rgy
loss
es a
re t
he v
alue
of t
he a
dd
ition
al e
nerg
y ge
nera
ted
by
cent
ral p
lant
s th
at is
lost
due
to
inhe
rent
in
effic
ienc
ies
(ele
ctric
al r
esis
tanc
e) in
del
iver
ing
ener
gy t
o th
e cu
stom
er v
ia t
he t
rans
mis
sion
and
dis
trib
utio
n sy
stem
. Sin
ce D
PV
gen
erat
es e
nerg
y at
or
near
the
cus
tom
er, t
hat
add
ition
al e
nerg
y is
not
lost
. Ene
rgy
loss
es c
an a
lso
act
as a
mag
nifie
r of
val
ue fo
r ca
pac
ity a
nd e
nviro
nmen
tal b
enefi
ts, s
ince
avo
ided
ene
rgy
loss
es r
esul
t in
low
er r
equi
red
cap
acity
and
low
er e
mis
sion
s.
AP
PR
OA
CH
OV
ER
VIE
WLo
sses
are
gen
eral
ly r
ecog
nize
d a
s a
valu
e, a
lthou
gh t
here
is s
igni
fican
t va
riatio
n ar
ound
wha
t ty
pe
of
loss
es a
re in
clud
ed a
nd h
ow t
hey
are
asse
ssed
. Los
ses
usua
lly r
epre
sent
a s
mal
l but
not
insi
gnifi
cant
so
urce
of v
alue
, alth
ough
som
e st
udie
s re
por
t co
mp
arat
ivel
y hi
gh v
alue
s.
• E
nerg
y lo
st in
del
iver
y m
agni
fy t
he v
alue
of o
ther
ben
efits
, inc
lud
ing
cap
acity
and
env
ironm
ent.
• C
alcu
late
loss
fact
or(s
) (am
ount
of l
oss
per
uni
t of
ene
rgy
del
iver
ed) b
ased
on
mod
eled
or
obse
rved
d
ata.
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•C
ong
esti
on
- B
ecau
se e
nerg
y lo
sses
are
pro
por
tiona
l to
the
inve
rse
of c
urre
nt s
qua
red
, the
hig
her
the
utili
zatio
n of
the
tra
nsm
issi
on &
dis
trib
utio
n sy
stem
, the
gre
ater
the
ene
rgy
loss
es.
•S
ola
r ch
arac
teri
zati
on—
The
timin
g, q
uant
ity, a
nd g
eogr
aphi
c lo
catio
n of
DP
V, a
nd t
here
fore
its
coin
cid
ence
with
del
iver
y sy
stem
util
izat
ion,
imp
acts
loss
es.
•In
put
Ass
ump
tio
ns:
•Lo
ss f
acto
rs -
Som
e st
udie
s ap
ply
loss
fact
ors
bas
ed o
n ac
tual
ob
serv
atio
n, o
ther
s d
evel
op
theo
retic
al lo
ss fa
ctor
s b
ased
on
syst
em m
odel
ing.
Fur
ther
, som
e ut
ility
sys
tem
s ha
ve h
ighe
r lo
sses
th
an o
ther
s.•
Met
hod
olo
gie
s:
•Ty
pes
of
loss
es r
eco
gni
zed
- M
ost
stud
ies
reco
gniz
e en
ergy
loss
es, s
ome
reco
gniz
e ca
pac
ity
loss
es, a
nd a
few
rec
ogni
ze e
nviro
nmen
tal l
osse
s.•
Ad
der
vs.
sta
nd-a
lone
val
ue -
The
re is
no
com
mon
ap
pro
ach
to w
heth
er lo
sses
are
rep
rese
nted
as
sta
nd-a
lone
val
ues
(for
exam
ple
, NR
EL
2008
and
E3
2012
) or
as a
dd
ers
to e
nerg
y, c
apac
ity, a
nd
envi
ronm
enta
l val
ue (f
or e
xam
ple
, Cro
ssb
ord
er (A
Z) 2
013
and
AP
S 2
013)
, com
plic
atin
g co
mp
aris
on
acro
ss s
tud
ies.
•
Leve
l of
tim
e an
d g
eog
rap
hic
gra
nula
rity
- S
ome
stud
ies
app
ly a
n av
erag
e lo
ss fa
ctor
to
all
ener
gy g
ener
ated
by
DP
V, o
ther
s ap
ply
pea
k/of
f-p
eak
fact
ors,
and
oth
ers
cond
uct
hour
ly a
naly
sis.
S
ome
stud
ies
also
refl
ect
geog
rap
hica
lly-v
aryi
ng lo
sses
.
SY
ST
EM
LO
SS
ES
BE
NE
FIT
AN
D C
OS
T
ES
TIM
ATE
S A
S R
EP
OR
TE
D B
Y R
EV
IEW
ED
S
TU
DIE
S
27
01
23
45
Cro
ssb
ord
er (C
A) 2
013
AE
/CP
R 2
012
E3
2012
NR
EL
2008
AE
/CP
R 2
006
Vote
So
lar
2005
R. D
uke
2005
(cen
ts/k
Wh
$201
2)
[Los
s in
ene
rgy
from
T&
D a
cros
s d
ista
nce]
[Incr
ease
in e
lect
ricity
, ca
pac
ity, T
&D
, env
iro
valu
es]
[Los
s in
ene
rgy
from
T&
D a
cros
s d
ista
nce]
[Incr
ease
in e
lect
ricity
, ca
pac
ity, T
&D
, env
iro
valu
es]
[Incr
ease
in e
lect
ricity
, ca
pac
ity, T
&D
, env
iro
valu
es]
[Incr
ease
in e
lect
ricity
, ca
pac
ity, T
&D
, env
iro
valu
es]
[Los
s in
ene
rgy
from
T&
D a
cros
s d
ista
nce]
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 27
of 5
9
WH
AT A
RE
LO
SS
ES
?
LOS
SE
S(C
ON
T’D
)
28
INS
IGH
TS
& IM
PLI
CAT
ION
S
• A
ll re
leva
nt s
yste
m lo
sses
—en
ergy
, cap
acity
, and
env
ironm
ent—
shou
ld b
e as
sess
ed.
• B
ecau
se lo
sses
are
driv
en b
y th
e sq
uare
of c
urre
nt, l
osse
s ar
e si
gnifi
cant
ly h
ighe
r d
urin
g p
eak
per
iod
s.
Ther
efor
e, w
hen
calc
ulat
ing
loss
es, i
t’s c
ritic
al t
o re
flect
mar
gina
l los
ses,
not
just
ave
rage
loss
es.
• W
heth
er o
r no
t lo
sses
are
ulti
mat
ely
rep
rese
nted
as
an a
dd
er t
o an
und
erly
ing
valu
e or
as
a st
and
-alo
ne
valu
e, t
hey
are
gene
rally
cal
cula
ted
sep
arat
ely.
Stu
die
s sh
ould
dis
tingu
ish
thes
e va
lues
from
the
und
erly
ing
valu
e fo
r tr
ansp
aren
cy a
nd t
o d
rive
cons
iste
ncy
of m
etho
dol
ogy.
Som
e en
ergy
gen
erat
ed a
t a
pow
er p
lant
is lo
st a
s it
trav
els
thro
ugh
the
tran
smis
sion
and
dis
trib
utio
n sy
stem
to
the
cust
omer
. As
show
n in
the
gra
phi
c b
elow
, mor
e th
an 9
0% o
f prim
ary
ener
gy in
put
into
a
pow
er p
lant
is lo
st b
efor
e it
reac
hes
the
end
use
, or
sta
ted
in r
ever
se, f
or e
very
one
uni
t of
ene
rgy
save
d o
r ge
nera
ted
clo
se t
o w
here
it is
nee
ded
, 10
units
of p
rimar
y en
ergy
are
sav
ed.
For
the
pur
pos
es o
f thi
s d
iscu
ssio
n d
ocum
ent,
re
leva
nt lo
sses
are
tho
se d
riven
by
inhe
rent
in
effic
ienc
ies
(ele
ctric
al r
esis
tanc
e) in
the
tr
ansm
issi
on a
nd d
istr
ibut
ion
syst
em, n
ot t
hose
in
the
pow
er p
lant
or
cust
omer
eq
uip
men
t. E
nerg
y lo
sses
are
pro
por
tiona
l to
the
squa
re o
f cur
rent
, an
d a
ssoc
iate
d c
apac
ity b
enefi
t is
pro
por
tiona
l to
the
squa
re o
f red
uced
load
.
LOO
KIN
G F
OR
WA
RD
Loss
es w
ill c
hang
e ov
er t
ime
as t
he lo
adin
g on
tra
nsm
issi
on a
nd d
istr
ibut
ion
lines
cha
nges
due
to
a co
mb
inat
ion
of c
hang
ing
cust
omer
dem
and
and
DP
V g
ener
atio
n.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 28
of 5
9
29
GE
NE
RAT
ION
CA
PAC
ITY
VALU
E O
VE
RV
IEW
Gen
erat
ion
cap
acity
val
ue is
the
am
ount
of c
entr
al g
ener
atio
n ca
pac
ity t
hat
can
be
def
erre
d o
f avo
ided
due
to
DP
V. K
ey d
river
s of
val
ue in
clud
e (1
) DP
V’s
dep
end
able
cap
acity
and
(2) s
yste
m c
apac
ity n
eed
s.
AP
PR
OA
CH
OV
ER
VIE
WG
ener
atio
n ca
pac
ity v
alue
is t
he a
void
ed c
ost
of t
he m
argi
nal c
apac
ity r
esou
rce,
mos
t fr
eque
ntly
ass
umed
to
be
a ga
s co
mb
ustio
n tu
rbin
e, a
nd b
ased
on
a ca
lcul
atio
n of
DP
V d
epen
dab
le c
apac
ity, m
ost
com
mon
ly
bas
ed o
n ef
fect
ive
load
car
ryin
g ca
pab
ility
(ELC
C).
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•Lo
ad g
row
th/g
ener
atio
n ca
pac
ity
inve
stm
ent
pla
n -
The
abili
ty t
o av
oid
or
def
er g
ener
atio
n ca
pac
ity d
epen
ds
on u
nder
lyin
g lo
ad g
row
th a
nd h
ow m
uch
add
ition
al c
apac
ity w
ill b
e ne
eded
, w
hen.
•S
ola
r ch
arac
teri
zati
on
- Th
e tim
ing,
qua
ntity
, and
geo
grap
hic
loca
tion
of D
PV,
and
the
refo
re it
s co
inci
den
ce w
ith s
yste
m p
eak,
imp
acts
DP
V’s
dep
end
able
cap
acity
(see
met
hod
olog
y b
elow
).•
Mar
ket
stru
ctur
e -
Som
e IS
Os
and
sta
tes
valu
e ca
pac
ity a
nd e
nerg
y se
par
atel
y, w
here
as s
ome
ISO
s on
ly h
ave
ener
gy m
arke
ts b
ut n
o ca
pac
ity m
arke
ts. I
SO
s w
ith o
nly
ener
gy m
arke
ts m
ay r
eflec
t ca
pac
ity v
alue
as
par
t of
the
ene
rgy
pric
e. F
or C
alifo
rnia
, E3
2012
cal
cula
tes
cap
acity
val
ue b
ased
on
“ne
t ca
pac
ity c
ost”
—th
e an
nual
fixe
d c
ost
of t
he m
argi
nal u
nit
min
us t
he g
ross
mar
gins
ca
ptu
red
in t
he e
nerg
y an
d a
ncill
ary
serv
ice
mar
ket.
•In
put
Ass
ump
tio
ns:
•M
arg
inal
res
our
ce -
Mos
t st
udie
s as
sum
e th
at a
gas
com
bus
tion
turb
ine,
or
occa
sion
ally
a g
as
com
bin
ed c
ycle
, is
the
gene
ratio
n ca
pac
ity r
esou
rce
that
cou
ld b
e d
efer
red
. Wha
t th
is r
esou
rce
is
and
its
asso
ciat
ed c
apita
l and
fixe
d O
&M
cos
ts a
re a
prim
ary
det
erm
inan
t of
cap
acity
val
ue.
•M
etho
do
log
ies:
•Fo
rmul
atio
n o
f d
epen
dab
le c
apac
ity
- Th
ere
is b
road
agr
eem
ent
that
DP
V’s
dep
end
able
cap
acity
is
mos
t ac
cura
tely
det
erm
ined
usi
ng a
n ef
fect
ive
load
car
ryin
g ca
pab
ility
(ELC
C) a
pp
roac
h, w
hich
m
easu
res
the
amou
nt o
f ad
diti
onal
load
tha
t ca
n b
e m
et w
ith t
he s
ame
leve
l of r
elia
bili
ty a
fter
ad
din
g D
PV.
The
re is
som
e va
riatio
n ac
ross
stu
die
s in
ELC
C r
esul
ts, l
ikel
y d
riven
by
a co
mb
inat
ion
of u
nder
lyin
g so
lar
reso
urce
pro
file
and
ELC
C c
alcu
latio
n m
etho
dol
ogy.
The
ap
pro
ach
to
dep
end
able
cap
acity
is s
omet
imes
diff
eren
t w
hen
cons
ider
ing
T&D
cap
acity
.•
Min
imum
DP
V r
equi
red
to
def
er c
apac
ity
- S
ome
stud
ies
(for
exam
ple
, Cro
ssb
ord
er (A
Z) 2
013)
cr
edit
ever
y un
it of
dep
end
able
DP
V c
apac
ity w
ith c
apac
ity v
alue
, whe
reas
oth
ers
(for
exam
ple
, A
PS
200
9) r
equi
re a
cer
tain
min
imum
am
ount
of s
olar
be
inst
alle
d t
o d
efer
an
actu
al p
lann
ed
reso
urce
bef
ore
cap
acity
val
ue is
cre
dite
d.
•In
clus
ion
of
loss
es -
Som
e st
udie
s in
clud
e ca
pac
ity lo
sses
as
an a
dd
er t
o ca
pac
ity v
alue
rat
her
than
as
a st
and
-alo
ne b
enefi
t.
GE
NE
RAT
ION
CA
PAC
ITY
BE
NE
FIT
AN
D
CO
ST
ES
TIM
ATE
S A
S R
EP
OR
TE
D B
Y
RE
VIE
WE
D S
TU
DIE
S
* =
val
ue t
akes
into
acc
ount
lo
ss s
avin
gs
05
1015
AP
S 2
013
Cro
ssb
ord
er (A
Z) 2
013*
CP
R (T
X) 2
013
Bea
ch (C
A) 2
013
CP
R (N
J/PA
) 201
2
LBN
L 20
12
E3
2012
AE
/CP
R 2
012*
AP
S 2
009
NR
EL
2008
CP
R (N
Y) 2
008
AE
/CP
R 2
006
Vote
Sol
ar 2
005
R. D
uke
2005
(cen
ts/k
Wh
$201
2)
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 29
of 5
9
30
GE
NE
RAT
ION
CA
PAC
ITY
(CO
NT’
D)
INS
IGH
TS
& IM
PLI
CAT
ION
S
• G
ener
atio
n ca
pac
ity v
alue
is h
ighl
y d
epen
den
t on
the
cor
rela
tion
of D
PV
gen
erat
ion
to lo
ad, s
o it’
s cr
itica
l to
acc
urat
ely
asse
ss t
hat
corr
elat
ion
usin
g an
ELC
C a
pp
roac
h, a
s al
l stu
die
s re
view
ed d
o. H
oew
ver,
vary
ing
resu
lts in
dic
ate
pos
sib
le d
iffer
ent
form
ulat
ions
of E
LCC
.
• Th
e va
lue
also
dep
end
s on
whe
ther
new
cap
acity
is n
eed
ed o
n th
e sy
stem
, and
the
refo
re w
heth
er D
PV
d
efer
s ne
w c
apac
ity. I
t’s im
por
tant
to
asse
ss w
hat
cap
acity
wou
ld h
ave
bee
n ne
eded
with
out
any
add
ition
al,
exp
ecte
d, o
r p
lann
ed D
PV.
• G
ener
atio
n ca
pac
ity v
alue
is li
kely
to
chan
ge s
igni
fican
tly a
s m
ore
DP
V, a
nd m
ore
rene
wab
le a
nd
dis
trib
uted
res
ourc
es o
f all
kind
s ar
e ad
ded
to
the
syst
em. S
ome
amou
nt o
f DP
V c
an d
isp
lace
the
mos
t co
stly
res
ourc
es in
the
cap
acity
sta
ck, b
ut in
crea
sing
am
ount
s of
DP
V c
ould
beg
in t
o d
isp
lace
less
cos
tly
reso
urce
s. S
imila
rly, t
he u
nder
lyin
g lo
ad s
hap
e, a
nd t
here
fore
eve
n th
e co
ncep
t of
a p
eak
coul
d b
egin
to
shift
.
KE
Y D
RIV
ER
S O
F VA
LUE
AN
D
MA
IN A
SS
UM
PT
ION
S
0123456
025
5075
100
ELC
C F
acto
r (%
)
Value of Generation Capacity (cents/kWh $2012)
Sen
sitiv
ity o
f G
ener
atio
n C
apac
ity
Valu
e to
the
ELC
C F
acto
r
Gas
Tur
bin
e -
$700
($/k
Wh)
Com
bin
ed C
ycle
- $
1,30
0 ($
/kW
h)
Cap
ital
Co
sts
AS
SU
MP
TIO
NS
:C
apac
ity F
acto
r: 2
0%D
isco
unt
Rat
e: 5
%P
lant
Life
time:
25
year
s
NormalizedPower (%)
100
%
50
%
0% 0
:00
12:0
00
0:0
0
Sys
tem
De
ma
nd
PV
So
uth
Fa
cin
g O
rie
nta
tio
ns
PV
We
st-F
aci
ng
Whi
le E
LCC
ass
esse
s D
PV
’s
cont
ribut
ion
to r
elia
bili
ty
thro
ugho
ut t
he y
ear,
gene
ratio
n ca
pac
ity v
alue
will
gen
eral
ly b
e hi
gher
if D
PV
out
put
is m
ore
coin
cid
ent
with
pea
k.
LOO
KIN
G F
OR
WA
RD
Gen
erat
ion
cap
acity
is o
ne o
f the
val
ues
mos
t lik
ely
to c
hang
e, m
ost
qui
ckly
, with
incr
easi
ng D
PV
p
enet
ratio
n. K
ey r
easo
ns fo
r th
is a
re (1
) inc
reas
ing
DP
V p
enet
ratio
n co
uld
hav
e th
e ef
fect
of p
ushi
ng t
he
pea
k to
late
r in
the
day
, whe
n D
PV
gen
erat
ion
is lo
wer
, and
(2) i
ncre
asin
g D
PV
pen
etra
tion
will
dis
pla
ce
exp
ensi
ve p
eaki
ng r
esou
rces
, but
onc
e th
ose
reso
urce
s ar
e d
isp
lace
d, t
he c
ost
of t
he n
ext
reso
urce
may
be
low
er. B
eyon
d D
PV,
it’s
imp
orta
nt t
o no
te t
hat
a sh
ift t
owar
ds
mor
e re
new
able
s co
uld
cha
nge
the
und
erly
ing
co
ncep
t of
a d
aily
or
seas
onal
pea
k.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 30
of 5
9
VALU
E O
VE
RV
IEW
The
tran
smis
sion
and
dis
trib
utio
n (T
&D
) cap
acity
val
ue is
a m
easu
re o
f the
net
cha
nge
in T
&D
infr
astr
uctu
re a
s a
resu
lt of
the
ad
diti
on o
f DP
V. B
enefi
ts o
ccur
whe
n D
PV
is a
ble
to
mee
t ris
ing
dem
and
loca
lly, r
elie
ving
cap
acity
co
nstr
aint
s up
stre
am a
nd d
efer
ring
or a
void
ing
tran
smis
sion
or
dis
trib
utio
n up
grad
es. C
osts
are
incu
rred
whe
n ad
diti
onal
tra
nsm
issi
on o
r d
istr
ibut
ion
inve
stm
ent
are
nece
ssar
y to
sup
por
t th
e ad
diti
on o
f DP
V, w
hich
cou
ld
occu
r w
hen
the
amou
nt o
f sol
ar e
nerg
y ex
ceed
s th
e d
eman
d in
the
loca
l are
a an
d in
crea
ses
need
ed li
ne c
apac
ity.
AP
PR
OA
CH
OV
ER
VIE
WTh
e ne
t va
lue
of d
efer
ring
or a
void
ing
T&D
inve
stm
ents
is d
riven
by
rate
of l
oad
gro
wth
, DP
V c
onfig
urat
ion
and
en
ergy
pro
duc
tion,
pea
k co
inci
den
ce a
nd d
epen
dab
le c
apac
ity. G
iven
the
site
sp
ecifi
c na
ture
of T
&D
, esp
ecia
lly
dis
trib
utio
n, t
here
can
be
sign
ifica
nt r
ange
in t
he c
alcu
late
d v
alue
of D
PV.
His
toric
ally
low
pen
etra
tions
of D
PV
has
m
eant
tha
t st
udie
s ha
ve p
rimar
ily fo
cuse
d o
n an
alyz
ing
the
abili
ty o
f DP
V t
o d
efer
tra
nsm
issi
on o
r d
istr
ibut
ion
upgr
ades
and
hav
e no
t fo
cuse
d o
n p
oten
tial c
osts
, whi
ch w
ould
like
ly n
ot a
rise
until
gre
ater
leve
ls o
f pen
etra
tion.
S
tud
ies
typ
ical
ly d
eter
min
e th
e T&
D c
apac
ity v
alue
bas
ed o
n th
e ca
pita
l cos
ts o
f pla
nned
exp
ansi
on p
roje
cts
in
the
regi
on o
f int
eres
t. H
owev
er, t
he g
ranu
larit
y of
ana
lysi
s d
iffer
s.
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•Lo
cati
ona
l cha
ract
eris
tics
-Tr
ansm
issi
on a
nd d
istr
ibut
ion
infr
astr
uctu
re p
roje
cts
are
inhe
rent
ly s
ite-
spec
ific
and
the
ir ag
e, s
ervi
ce li
fe, a
nd u
se c
an v
ary
sign
ifica
ntly
. Thu
s, t
he n
eed
, siz
e an
d c
ost
of
upgr
ades
, rep
lace
men
t or
exp
ansi
on c
orre
spon
din
gly
vary
. •
Pro
ject
ed lo
ad g
row
th -
Exp
ecte
d r
ate
of d
eman
d g
row
th a
ffect
s th
e ne
ed, s
cale
and
cos
t of
T&
D
upgr
ades
and
the
ab
ility
of D
PV
to
def
er o
r of
fset
ant
icip
ated
T&
D e
xpan
sion
s. T
he r
ate
of g
row
th o
f DP
V
wou
ld n
eed
to
keep
pac
e w
ith t
he g
row
th in
dem
and
, bot
h b
y or
der
of m
agni
tud
e an
d s
pee
d.
•P
V t
emp
ora
l co
inci
den
ce w
ith
syst
em a
nd/
or
loca
l dem
and
- T
he t
imin
g of
ene
rgy
pro
duc
tion
from
D
PV
and
its
coin
cid
ence
with
sys
tem
pea
ks (t
rans
mis
sion
) and
loca
l pea
ks (d
istr
ibut
ion)
driv
e th
e ab
ility
of
DP
V t
o co
ntrib
ute
as d
epen
dab
le c
apac
ity t
hat
coul
d d
efer
or
dis
pla
ce a
tra
nsm
issi
on o
r d
istr
ibut
ion
cap
acity
up
grad
e.•
The
leng
th o
f ti
me
the
inve
stm
ent
is d
efer
red
-Th
e le
ngth
of t
ime
that
T&
D c
an b
e d
efer
red
by
the
inst
alla
tion
of P
V v
arie
s b
y th
e ra
te o
f loa
d g
row
th, t
he a
ssum
ed d
epen
dab
le c
apac
ity o
f the
PV,
and
PV
’s
corr
elat
ion
with
pea
k. T
he c
ost
of c
apita
l sav
ed w
ill in
crea
se w
ith t
he le
ngth
of d
efer
men
t.•
Inp
ut A
ssum
pti
ons
:
•T
or
D in
vest
men
t p
lan
char
acte
rist
ics
- D
epen
din
g up
on d
ata
avai
lab
le a
nd d
epth
of a
naly
sis,
stu
die
s va
ry b
y th
e le
vel o
f gra
nula
rity
in w
hich
T&
D in
vest
men
t p
lans
wer
e as
sess
ed–p
roje
ct b
y p
roje
ct o
r b
road
er
gene
raliz
atio
ns a
cros
s se
rvic
e te
rrito
ries.
•M
etho
do
log
ies:
•A
ccru
al o
f ca
pac
ity
valu
e to
DP
V -
One
of t
he m
ost
sign
ifica
nt m
etho
dol
ogic
al d
iffer
ence
s is
whe
ther
D
PV
has
incr
emen
tal T
&D
cap
acity
val
ue t
he fa
ce o
f “lu
mp
y” T
&D
inve
stm
ents
. (se
e im
plic
atio
ns a
nd
insi
ghts
).•
Loss
es -
Som
e st
udie
s in
clud
e th
e m
agni
fied
ben
efit
of d
efer
red
T&
D c
apac
ity d
ue t
o av
oid
ed lo
sses
w
ithin
the
cal
cula
tion
of T
&D
val
ue, w
hile
oth
ers
item
ize
line
loss
es s
epar
atel
y.
T&
D C
APA
CIT
Y B
EN
EFI
T A
ND
CO
ST
E
ST
IMAT
ES
AS
RE
PO
RT
ED
BY
RE
VIE
WE
DS
TU
DIE
S
31
TRA
NS
MIS
SIO
N &
DIS
TRIB
UTI
ON
CA
PAC
ITY
05
1015
AP
S 2
013*
Cro
ssb
oard
er (A
Z) 2
013
CP
R (T
X) 2
013
Cro
ssb
ord
er (C
A) 2
013
CP
R (N
J/PA
) 201
2
E3
2012
AE
/CP
R 2
012*
AP
S 2
009*
NR
EL
2008
AE
/CP
R 2
006
Vote
Sol
ar 2
005
(cen
ts/k
Wh
$201
2) * =
val
ue in
clud
es lo
sses
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 31
of 5
9
TRA
NS
MIS
SIO
N &
DIS
TRIB
UTI
ON
CA
PAC
ITY
INS
IGH
TS
& IM
PLI
CAT
ION
S
•S
trat
egic
ally
tar
gete
d D
PV
dep
loym
ent
can
relie
ve T
&D
cap
acity
con
stra
ints
by
pro
vid
ing
pow
er c
lose
to
dem
and
and
pot
entia
lly d
efer
cap
acity
inve
stm
ents
, but
dis
per
sed
dep
loym
ent
has
bee
n fo
und
to
pro
vid
e le
ss b
enefi
t. T
hus,
the
ab
ility
to
acce
ss D
PV
’s T
&D
def
erra
l val
ue w
ill r
equi
re p
roac
tive
dis
trib
utio
n p
lann
ing
that
inco
rpor
ates
dis
trib
uted
ene
rgy
reso
urce
s, s
uch
as D
PV,
into
the
eva
luat
ion.
•Th
e va
lues
of T
&D
are
oft
en g
roup
ed t
oget
her,
but
the
y ar
e un
ique
whe
n co
nsid
erin
g th
e p
oten
tial
cost
s an
d b
enefi
ts t
hat
resu
lt fr
om D
PV.
•W
hile
the
ab
ility
to
def
er o
r av
oid
tra
nsm
issi
on is
stil
l loc
atio
nal d
epen
den
t, it
is le
ss s
o th
an
dis
trib
utio
n. T
rans
mis
sion
agg
rega
tes
dis
par
ate
dis
trib
utio
n ar
eas
and
the
effe
cts
of a
dd
ition
al
DP
V a
t th
e d
istr
ibut
ion
leve
l typ
ical
ly r
equi
re le
ss g
ranu
lar
dat
a an
d a
naly
sis.
•Th
e d
istr
ibut
ion
syst
em r
equi
res
mor
e ge
ogra
phi
cally
sp
ecifi
c d
ata
that
refl
ects
the
site
sp
ecifi
c ch
arac
teris
tics
such
as
loca
l hou
rly P
V p
rod
uctio
n an
d c
orre
latio
n w
ith lo
cal l
oad
.
•Th
ere
are
sign
ifica
ntly
diff
erin
g ap
pro
ache
s on
the
ab
ility
of D
PV
to
accr
ue T
&D
cap
acity
def
erm
ent
or
avoi
dan
ce v
alue
tha
t re
qui
re r
esol
utio
n:
•H
ow s
houl
d D
PV
’s c
apac
ity d
efer
ral v
alue
be
estim
ated
in t
he fa
ce o
f “lu
mp
y” T
&D
inve
stm
ents
? W
hile
AP
S 2
009
and
AP
S 2
013
pos
it th
at a
min
imum
am
ount
of s
olar
mus
t b
e in
stal
led
to
def
er
cap
acity
bef
ore
cred
it is
war
rant
ed, C
ross
bor
der
(AZ
) 201
3 cr
edits
eve
ry u
nit
of r
elia
ble
cap
acity
w
ith c
apac
ity v
alue
.
•W
hat
stan
dar
d s
houl
d b
e ap
plie
d t
o es
timat
e P
V’s
ab
ility
to
def
er a
sp
ecifi
c d
istr
ibut
ion
exp
ansi
on p
roje
ct?
Whi
le m
ost
stud
ies
use
ELC
C t
o d
eter
min
e ef
fect
ive
cap
acity
, AP
S 2
009
and
A
PS
201
3 us
e th
e le
vel a
t w
hich
the
re is
a 9
0% c
onfid
ence
of t
hat
amou
nt o
f gen
erat
ion.
LOO
KIN
G F
OR
WA
RD
Any
dis
trib
uted
res
ourc
es, n
ot ju
st D
PV,
tha
t ca
n b
e in
stal
led
nea
r th
e en
d u
ser
to r
educ
e us
e of
, and
co
nges
tion
alon
g, t
he T
&D
net
wor
k co
uld
pot
entia
lly p
rovi
de
T&D
val
ue. T
his
incl
udes
tec
hnol
ogie
s th
at a
llow
en
ergy
to
be
used
mor
e ef
ficie
ntly
or
at d
iffer
ent
times
, red
ucin
g th
e q
uant
ity o
f ele
ctric
ity t
rave
ling
thro
ugh
the
T&D
net
wor
k (e
spec
ially
dur
ing
pea
k ho
urs)
.
32
TR
AN
SM
ISS
ION
& D
IST
RIB
UT
ION
SY
ST
EM
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 32
of 5
9
GR
ID S
UP
PO
RT
SE
RV
ICE
S
VALU
E O
VE
RV
IEW
Grid
sup
por
t se
rvic
es, a
lso
com
mon
ly r
efer
red
to
as a
ncill
ary
serv
ices
(AS
) in
who
lesa
le e
nerg
y m
arke
ts, a
re r
equi
red
to
ena
ble
the
rel
iab
le o
per
atio
n of
inte
rcon
nect
ed e
lect
ric g
rid s
yste
ms,
incl
udin
g op
erat
ing
rese
rves
, rea
ctiv
e su
pp
ly
and
vol
tage
con
trol
; fre
que
ncy
regu
latio
n; e
nerg
y im
bal
ance
; and
sch
edul
ing.
AP
PR
OA
CH
OV
ER
VIE
WTh
ere
is s
igni
fican
t va
riatio
n ac
ross
stu
die
s on
the
imp
act
DP
V w
ill h
ave
on t
he a
dd
ition
or
red
uctio
n in
the
nee
d o
f gr
id s
upp
ort
serv
ices
and
the
ass
ocia
ted
cos
t or
ben
efit.
Mos
t st
udie
s fo
cus
on t
he c
ost
DP
V c
ould
incu
r in
req
uirin
g ad
diti
onal
grid
sup
por
t se
rvic
es, w
hile
a m
inor
ity e
valu
ate
the
valu
e D
PV
cou
ld p
rovi
de
by
red
ucin
g lo
ad a
nd r
equi
red
re
serv
es o
r th
e A
S t
hat
DP
V c
ould
pro
vid
e w
hen
coup
led
with
oth
er t
echn
olog
ies.
Whi
le m
etho
dol
ogie
s ar
e in
cons
iste
nt, t
he a
pp
roac
hes
gene
rally
focu
s on
met
hod
s fo
r ca
lcul
atin
g ch
ange
s in
nec
essa
ry o
per
atin
g re
serv
es,
and
less
pre
cisi
on o
r ru
les
of t
hum
b a
re a
pp
lied
to
the
rem
aind
er o
f AS
, suc
h as
vol
tage
reg
ulat
ion.
Op
erat
ing
rese
rves
are
typ
ical
ly e
stim
ated
by
det
erm
inin
g th
e re
liab
le c
apac
ity fo
r w
hich
PV
can
be
coun
ted
on
to p
rovi
de
cap
acity
whe
n d
eman
ded
ove
r th
e ye
ar.
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•R
elia
bili
ty s
tand
ard
s an
d m
arke
t ru
les
- Th
e st
and
ard
s an
d r
ules
for
relia
bili
ty t
hat
gove
rn t
he r
equi
rem
ents
fo
r gr
id s
upp
ort
serv
ices
and
res
erve
mar
gins
diff
er. T
hese
sta
ndar
ds
dire
ctly
imp
act
the
pot
entia
l net
val
ue o
f ad
din
g D
PV
to
the
syst
em.
•A
vaila
bili
ty o
f an
cilla
ry s
ervi
ces
mar
ket
- W
here
who
lesa
le e
lect
ricity
mar
kets
exi
st, t
he e
stim
ated
val
ue is
co
rrel
ated
to
the
mar
ket
pric
es o
f AS
. •
PV
tem
po
ral c
oin
cid
ence
wit
h sy
stem
and
/ o
r lo
cal d
eman
d -
The
tim
ing
of e
nerg
y p
rod
uctio
n fr
om D
PV
an
d it
’s c
oinc
iden
ce w
ith s
yste
m p
eaks
diff
ers
loca
tiona
lly.
•P
enet
rati
on
of
PV
- A
s P
V p
enet
ratio
ns in
crea
se, t
he v
alue
of i
ts r
elia
ble
cap
acity
dec
reas
es a
nd, u
nder
st
and
ard
rel
iab
ility
pla
nnin
g ap
pro
ache
s, w
ould
incr
ease
the
am
ount
of s
yste
m r
eser
ves
nece
ssar
y to
m
aint
ain
relia
ble
op
erat
ions
. •
Sys
tem
gen
erat
ion
mix
- T
he p
erfo
rman
ce c
hara
cter
istic
s of
the
exi
stin
g ge
nera
tion
mix
, inc
lud
ing
the
gene
rato
rs a
bili
ty t
o re
spon
d q
uick
ly b
y in
crea
sing
or
dec
reas
ing
pro
duc
tion,
can
sig
nific
antly
cha
nge
the
sup
ply
val
ue o
f anc
illar
y se
rvic
es a
nd t
he v
alue
.•
Met
hod
olo
gie
s:
•R
elia
ble
or
dep
end
able
cap
acit
y o
f P
V -
The
deg
ree
that
DP
V c
an b
e d
epen
ded
to
pro
vid
e ca
pac
ity w
hen
dem
and
ed h
as a
dire
ct e
ffect
on
the
amou
nt o
f op
erat
ing
rese
rves
tha
t th
e re
st o
f the
sys
tem
mus
t su
pp
ly.
The
high
er t
he “
dep
end
able
cap
acity
,” t
he le
ss o
per
atin
g re
serv
es n
eces
sary
. •
Co
rrel
atin
g r
educ
ed lo
ad w
ith
red
uced
anc
illar
y se
rvic
e ne
eds
- C
ross
bor
der
(AZ
) 201
3 ca
lcul
ated
a n
et
ben
efit
of P
DV
bas
ed o
n 1)
load
red
uctio
n &
red
uced
op
erat
ing
rese
rve
req
uire
men
ts; 2
) pea
k d
eman
d
red
uctio
n an
d u
tility
cap
acity
req
uire
men
ts.
•P
ote
ntia
l of
PV
to
pro
vid
e g
rid
sup
po
rt w
ith
tech
nolo
gy
coup
ling
- W
hile
the
prim
ary
focu
s ac
ross
stu
die
s w
as t
he im
pac
t D
PV
wou
ld h
ave
on t
he n
eed
for
add
ition
al A
S, N
RE
L 20
08 &
AE
/CP
R 2
006
bot
h no
ted
tha
t P
V c
ould
pro
vid
e vo
ltage
reg
ulat
ion
with
sm
art
inve
rter
s w
ere
inst
alle
d.
GR
ID S
UP
PO
RT
SE
RV
ICE
S B
EN
EFI
T A
ND
CO
ST
ES
TIM
ATE
S A
S R
EP
OR
TE
D B
Y
RE
VIE
WE
D S
TU
DIE
S
33
-10
12
Cro
ssb
ord
er (A
Z) 2
013
Cro
ssb
ord
er (C
A) 2
013
LBN
L 20
12
E3
2012
NR
EL
2008
AP
S 2
009
(cen
ts/k
Wh
$201
2)
[dec
reas
ed o
per
atin
g &
ca
pac
ity r
eser
ve r
equi
rem
ent]
[bas
ed o
n C
AIS
O
2011
Mar
ket
Valu
es]
[Mar
ket
valu
e of
non
-sp
inni
ng
rese
rves
, sp
inni
ng r
eser
ves,
and
re
gula
tion]
[1%
of a
void
ed
ener
gy v
alue
]
[Met
a-an
alys
is]
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 33
of 5
9
GR
ID S
UP
PO
RT
SE
RV
ICE
S
Gri
d S
upp
ort
Ser
vice
s
The
po
tent
ial f
or
PV
to
p
rovi
de
gri
d s
upp
ort
se
rvic
es (w
ith
tech
nolo
gy
mo
difi
cati
ons
)
RE
AC
TIV
E S
UP
PLY
AN
D
VO
LTA
GE
CO
NTR
OL
(+/-
)P
V w
ith a
n ad
vanc
ed in
vert
er c
an
inje
ct/c
onsu
me
VAR
s, a
dju
stin
g to
co
ntro
l vol
tage
FRE
QU
EN
CY
RE
GU
LATI
ON
(+/-
)A
dva
nced
inve
rter
s ca
n ad
just
out
put
fr
eque
ncy;
sta
ndar
d in
vert
ers
may
EN
ER
GY
IMB
ALA
NC
E
(+/-
)If
PV
out
put
< e
xpec
ted
, im
bal
ance
se
rvic
e is
req
uire
d. A
dva
nced
inve
rter
s co
uld
ad
just
out
put
to
pro
vid
e im
bal
ance
OP
ER
ATIN
G R
ES
ER
VE
S
(-)
Dep
end
ing
on w
eath
er, c
ontr
olla
bili
ty,
stan
dal
one
PV
may
intr
oduc
e
add
ition
al fo
reca
st e
rror
SC
HE
DU
LIN
G /
FO
RE
CA
STI
NG
(-)
The
varia
bili
ty o
f the
sol
ar r
esou
rce
req
uire
s ad
diti
onal
fore
cast
ing
to
red
uce
unce
rtai
nty
34
INS
IGH
TS
& IM
PLI
CAT
ION
S
•A
s w
ith la
rge
scal
e re
new
able
inte
grat
ion,
the
re is
stil
l con
trov
ersy
ove
r d
eter
min
ing
the
net
chan
ge in
“an
cilla
ry s
ervi
ces
due
to
varia
ble
gen
erat
ion
and
muc
h m
ore
cont
rove
rsy
rega
rdin
g ho
w t
o al
loca
te t
hose
cos
ts b
etw
een
spec
ific
gene
rato
rs o
r lo
ads.
” (L
BN
L 20
12)
•A
reas
with
who
lesa
le A
S m
arke
ts e
nab
le e
asie
r q
uant
ifica
tion
of t
he p
rovi
sion
of A
S s
ervi
ces.
R
egio
ns w
ithou
t m
arke
ts h
ave
less
sta
ndar
d m
etho
dol
ogie
s fo
r q
uant
ifyin
g th
e va
lue
of A
S
serv
ices
.
•O
ne o
f the
mos
t si
gnifi
cant
diff
eren
ces
in r
evie
wed
met
hod
olog
ical
ap
pro
ache
s is
whe
ther
the
ne
cess
ary
amou
nt o
f op
erat
ing
rese
rves
, as
spec
ified
by
req
uire
d r
eser
ve m
argi
n, d
ecre
ases
by
DP
V’s
cap
acity
val
ue (a
s d
eter
min
ed b
y E
LCC
, for
exa
mp
le).
Cro
ssb
ord
er (C
A) 2
013,
E3
2012
an
d V
ote
Sol
ar 2
005
note
tha
t th
e ad
diti
on o
f DP
V r
educ
es lo
ad s
erve
d b
y ce
ntra
l gen
erat
ion,
th
us a
llow
ing
utili
ties
to r
educ
e p
rocu
red
res
erve
s. A
dd
ition
al a
naly
sis
is n
eed
ed t
o d
eter
min
e w
heth
er t
he r
equi
red
leve
l of r
eser
ves
shou
ld b
e ad
just
ed in
the
face
of a
cha
ngin
g sy
stem
.
•S
tud
ies
varie
d in
the
ir as
sess
men
ts o
f grid
sup
por
t se
rvic
es. A
PS
, 200
9 d
id n
ot e
xpec
t D
PV
w
ould
con
trib
ute
sign
ifica
ntly
to
spin
ning
or
oper
atin
g re
serv
es, b
ut p
red
icte
d r
egul
atio
n re
serv
es c
ould
be
affe
cted
at
high
pen
etra
tion
leve
ls.
LOO
KIN
G F
OR
WA
RD
Incr
easi
ng le
vels
of d
istr
ibut
ed e
nerg
y re
sour
ces
and
var
iab
le r
enew
able
gen
erat
ion
will
beg
in t
o sh
ift
bot
h th
e ne
ed fo
r gr
id s
upp
ort
serv
ices
as
wel
l as
the
typ
es o
f ass
ets
that
can
and
nee
d t
o p
rovi
de
them
. The
ab
ility
of D
PV
to
pro
vid
e gr
id s
upp
ort
req
uire
s te
chno
logy
mod
ifica
tions
or
add
ition
s, s
uch
as a
dva
nced
inve
rter
s or
sto
rage
, whi
ch in
cur
add
ition
al c
osts
. How
ever
, it
is li
kely
tha
t th
e ne
t va
lue
pro
pos
ition
will
incr
ease
as
tech
nolo
gy c
osts
dec
reas
e an
d t
he o
pp
ortu
nity
(or
req
uire
men
ts) t
o p
rovi
de
thes
e se
rvic
es in
crea
se w
ith p
enet
ratio
n.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 34
of 5
9
35
FIN
AN
CIA
L: F
UE
L P
RIC
E H
ED
GE
FUE
L P
RIC
E H
ED
GE
BE
NE
FIT
AN
DC
OS
T E
ST
IMAT
ES
AS
RE
PO
RT
ED
BY
R
EV
IEW
ED
ST
UD
IES
VALU
E O
VE
RV
IEW
DP
V p
rod
uces
rou
ghly
con
stan
t-co
st p
ower
com
par
ed t
o fo
ssil
fuel
gen
erat
ion,
whi
ch is
tie
d t
o p
oten
tially
vo
latil
e fu
el p
rices
. DP
V c
an p
rovi
de
a “h
edge
” ag
ains
t it,
red
ucin
g ris
k ex
pos
ure
to u
tiliti
es a
nd c
usto
mer
s.
AP
PR
OA
CH
OV
ER
VIE
WM
ore
than
hal
f the
stu
die
s re
view
ed a
ckno
wle
dge
DP
V’s
fuel
pric
e he
dge
ben
efit,
alth
ough
few
er q
uant
ify it
an
d t
hose
tha
t d
o ta
ke d
iffer
ent,
alth
ough
con
cep
tual
ly s
imila
r, ap
pro
ache
s.
• In
futu
re y
ears
whe
n na
tura
l gas
futu
res
mar
ket
pric
es a
re a
vaila
ble
, usi
ng t
hose
NY
ME
X p
rices
to
dev
elop
a
natu
ral g
as p
rice
fore
cast
sho
uld
incl
ude
the
valu
e of
vol
atili
ty.
• In
futu
re y
ears
bey
ond
whe
n na
tura
l gas
futu
res
mar
ket
pric
es a
re a
vaila
ble
, est
imat
e na
tura
l gas
pric
e an
d v
olat
ility
val
ue s
epar
atel
y. D
iffer
ing
app
roac
hes
incl
ude:
• E
scal
atin
g N
YM
EX
pric
es a
t a
cons
tant
rat
e, u
nder
the
ass
ump
tion
that
doi
ng s
o w
ould
con
tinue
to
re
flect
hed
ge v
alue
(Cro
ssb
ord
er (A
Z) 2
013)
; or
• E
stim
atin
g vo
latil
ity h
edge
val
ue s
epar
atel
y as
the
val
ue o
r an
op
tion/
swap
, or
as t
he a
ctua
l pric
e ad
der
the
util
ity is
incu
rrin
g no
w t
o he
dge
gas
pric
es (C
PR
(NJ/
PA 2
012)
, NR
EL
2008
).
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•M
arg
inal
res
our
ce -
Wha
t re
sour
ce is
on
the
mar
gin,
and
the
refo
re h
ow m
uch
fuel
is d
isp
lace
d
varie
s.•
Exp
osu
re t
o f
uel p
rice
vo
lati
lity
- M
ost
utili
ties
alre
ady
hed
ge s
ome
por
tion
of t
heir
natu
ral g
as
pur
chas
es fo
r so
me
per
iod
of t
ime
in t
he fu
ture
. •
Met
hod
olo
gie
s:
•A
pp
roac
h to
est
imat
ing
val
ue -
Whi
le m
ost
stud
ies
agre
e th
at N
YM
EX
futu
res
pric
es a
re a
n ad
equa
te r
eflec
tion
of v
olat
ility
, the
re is
no
larg
ely
agre
ed u
pon
ap
pro
ach
to e
stim
atin
g vo
latil
ity
bey
ond
whe
n th
ose
pric
es a
re a
vaila
ble
.
INS
IGH
TS
& IM
PLI
CAT
ION
S
• N
YM
EX
futu
res
mar
ket
pric
es a
re a
n ad
equa
te r
eflec
tion
of v
olat
ility
in t
he y
ears
in w
hich
it o
per
ates
.•
Bey
ond
tha
t, v
olat
ility
sho
uld
be
estim
ated
, alth
ough
the
re is
no
obvi
ous
bes
t p
ract
ice.
Fur
ther
wor
k is
re
qui
red
to
dev
elop
an
app
roac
h th
at a
ccur
atel
y m
easu
res
hed
ge v
alue
.
01
23
45
CP
R (T
X) 2
013
CP
R (N
J/PA
) 201
2
NR
EL
2008
R. D
uke
2005
(cen
ts/k
Wh
$201
2)
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 35
of 5
9
FIN
AN
CIA
L: M
AR
KE
T P
RIC
E R
ES
PO
NS
EVA
LUE
OV
ER
VIE
WTh
e ad
diti
on o
f DP
V, e
spec
ially
at
high
er p
enet
ratio
ns, c
an a
ffect
the
mar
ket
pric
e of
ele
ctric
ity in
a p
artic
ular
m
arke
t or
ser
vice
ter
ritor
y. T
hese
mar
ket
pric
e ef
fect
s sp
an e
nerg
y an
d c
apac
ity v
alue
s in
the
sho
rt t
erm
and
long
te
rm, a
ll of
whi
ch a
re in
terr
elat
ed. B
enefi
ts c
an o
ccur
as
DP
V p
rovi
des
ele
ctric
ity c
lose
to
dem
and
, red
ucin
g th
e d
eman
d fo
r ce
ntra
lly-s
upp
lied
ele
ctric
ity a
nd t
he fu
el p
ower
ing
thos
e ge
nera
tors
, the
reb
y lo
wer
ing
elec
tric
ity
pric
es a
nd p
oten
tially
fuel
com
mod
ity p
rices
. A r
elat
ed b
enefi
t is
der
ived
from
the
effe
ct o
f DP
V’s
con
trib
utio
n at
hi
gher
pen
etra
tions
to
resh
ape
the
load
pro
file
that
cen
tral
gen
erat
ors
need
to
mee
t. D
epen
din
g up
on t
he
corr
elat
ion
of D
PV
pro
duc
tion
and
load
, the
pea
k d
eman
d c
ould
be
red
uced
and
the
mar
gina
l gen
erat
or c
ould
be
mor
e ef
ficie
nt a
nd le
ss c
ostly
, red
ucin
g to
tal e
lect
ricity
cos
t. H
owev
er, t
hese
ben
efits
cou
ld p
oten
tially
be
red
uced
in
the
long
er t
erm
as
ener
gy p
rices
dec
line,
whi
ch c
ould
res
ult
in h
ighe
r d
eman
d. A
dd
ition
ally
, dep
ress
ed p
rices
in
the
ener
gy m
arke
t co
uld
hav
e a
feed
bac
k ef
fect
by
rais
ing
cap
acity
pric
es.
AP
PR
OA
CH
OV
ER
VIE
WW
hile
sev
eral
stu
die
s ev
alua
te a
mar
ket
pric
e re
spon
se o
f DP
V, d
istin
ct a
pp
roac
hes
wer
e em
plo
yed
by
E3
2012
, C
PR
(NJ/
PN
) 201
2, a
nd N
RE
L 20
08.
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•M
etho
do
log
ies:
•C
ons
ider
ing
mar
ket
pri
ce e
ffec
ts o
f D
PV
in t
he c
ont
ext
of
oth
er r
enew
able
tec
hno
log
ies
- E
3 20
12
inco
rpor
ated
mar
ket
pric
e ef
fect
in it
s hi
gh p
enet
ratio
n ca
se b
y ad
just
ing
dow
nwar
d t
he m
argi
nal v
alue
of
ener
gy t
hat
DP
V w
ould
dis
pla
ce. H
owev
er, f
or t
he p
urp
oses
of t
he s
tud
y, E
3 20
12 d
id n
ot a
dd
thi
s as
a
ben
efit
to t
he a
void
ed c
ost
bec
ause
the
y “a
ssum
e th
e m
arke
t p
rice
effe
ct w
ould
als
o oc
cur
with
alte
rnat
ive
app
roac
hes
to m
eetin
g [C
A’s]
RP
S.”
•
Inco
rpo
rati
ng c
apac
ity
effe
cts
- E
3 20
12 r
epre
sent
ed a
pot
entia
l fee
db
ack
effe
ct b
etw
een
the
ener
gy
and
cap
acity
by
assu
min
g an
ene
rgy
mar
ket
calib
ratio
n fa
ctor
. Tha
t is
, it
assu
mes
tha
t, in
the
long
run
, the
C
CG
T's
ener
gy m
arke
t re
venu
es p
lus
the
cap
acity
pay
men
t eq
ual t
he fi
xed
and
var
iab
le c
osts
of t
he
CC
GT.
The
refo
re, a
CC
GT
wou
ld c
olle
ct m
ore
reve
nue
thro
ugh
the
cap
acity
and
ene
rgy
mar
kets
tha
n is
ne
eded
to
cove
r its
cos
ts, a
nd a
dec
reas
e in
ene
rgy
cost
s w
ould
res
ult
in a
rel
ativ
e in
crea
se in
cap
acity
co
sts.
•C
PR
(NJ/
PA) 2
012
inco
rpor
ates
mar
ket
pric
e ef
fect
“b
y re
duc
ing
dem
and
dur
ing
the
high
pric
ed h
ours
[re
sulti
ng in
] a c
ost
savi
ngs
real
ized
by
all c
onsu
mer
s.”
They
not
e “t
hat
furt
her
inve
stig
atio
n of
the
met
hod
s m
ay b
e w
arra
nted
in li
ght
of t
wo
argu
men
ts...
that
the
met
hod
olog
y d
oes
add
ress
ind
uced
incr
ease
in
dem
and
due
to
pric
e re
duc
tions
, and
tha
t it
only
ad
dre
sses
sho
rt-r
un e
ffect
s (ig
norin
g th
e im
pac
t on
ca
pac
ity m
arke
ts).”
INS
IGH
TS
& IM
PLI
CAT
ION
S
•Th
e m
arke
t p
rice
red
uctio
n va
lue
only
ass
esse
s th
e in
itial
mar
ket
reac
tion
of r
educ
ed p
rice,
not
su
bse
que
nt m
arke
t d
ynam
ics
(e.g
. inc
reas
ed d
eman
d in
res
pon
se t
o p
rice
red
uctio
ns, o
r th
e im
pac
t on
the
ca
pac
ity m
arke
t), w
hich
has
to
be
stud
ied
and
con
sid
ered
, esp
ecia
lly in
ligh
t of
hig
her
pen
etra
tions
of D
PV.
LOO
KIN
G F
OR
WA
RD
Tech
nolo
gies
pow
ered
by
risk-
free
fuel
sou
rces
(suc
h as
win
d) a
nd t
echn
olog
ies
that
incr
ease
the
effi
cien
cy o
f en
ergy
use
and
dec
reas
e co
nsum
ptio
n w
ould
als
o ha
ve s
imila
r ef
fect
s.
Pri
ce(b
efo
re P
V)
Pri
ce(a
fter
PV
)
Load
(bef
ore
PV
)Lo
ad(a
fter
PV
)
Mar
ket
Pri
ce
Red
uctio
n
MA
RK
ET
PR
ICE
VS
. LO
AD
36
Sou
rce:
CP
R (N
J/PA
) 201
2
MA
RK
ET
PR
ICE
RE
SP
ON
SE
BE
NE
FIT
AN
D C
OS
T E
ST
IMAT
ES
AS
RE
PO
RT
ED
BY
RE
VIE
WE
D S
TU
DIE
S
02
46
8C
PR
(NJ/
PA) 2
012
NR
EL
2008
(cen
ts/k
Wh
$201
2)
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 36
of 5
9
SE
CU
RIT
Y: R
ELI
AB
ILIT
Y A
ND
RE
SIL
IEN
CY
VALU
E O
VE
RV
IEW
The
grid
sec
urity
val
ue t
hat
DP
V c
ould
pro
vid
e is
att
ribut
able
to
thre
e p
rimar
y fa
ctor
s, t
he la
st o
f whi
ch w
ould
re
qui
re c
oup
ling
DP
V w
ith o
ther
tec
hnol
ogie
s to
ach
ieve
the
ben
efit:
1.Th
e p
oten
tial t
o re
duc
e ou
tage
s b
y re
duc
ing
cong
estio
n al
ong
the
T&D
net
wor
k. P
ower
out
ages
and
ro
lling
bla
ckou
ts a
re m
ore
likel
y w
hen
dem
and
is h
igh
and
the
T&
D s
yste
m is
str
esse
d.
2.Th
e ab
ility
to
red
uce
larg
e-sc
ale
outa
ges
by
incr
easi
ng t
he d
iver
sity
of t
he e
lect
ricity
sys
tem
’s
gene
ratio
n p
ortf
olio
with
sm
alle
r ge
nera
tors
tha
t ar
e ge
ogra
phi
cally
dis
per
sed
.3.
The
ben
efit
to c
usto
mer
s to
pro
vid
e b
ack-
up p
ower
sou
rces
ava
ilab
le d
urin
g ou
tage
s th
roug
h th
e co
mb
inat
ion
of P
V, c
ontr
ol t
echn
olog
ies,
inve
rter
s an
d s
tora
ge.
AP
PR
OA
CH
OV
ER
VIE
WW
hile
the
re is
gen
eral
agr
eem
ent
acro
ss s
tud
ies
that
inte
grat
ing
DP
V n
ear
the
poi
nt o
f use
will
dec
reas
e st
ress
on
the
bro
ader
T&
D s
yste
m, m
ost
stud
ies
do
not
calc
ulat
e a
ben
efit
due
to
the
diffi
culty
of
qua
ntifi
catio
n. C
PR
201
2 an
d 2
011
did
rep
rese
nt t
he v
alue
as
the
valu
e of
avo
ided
out
ages
bas
ed o
n th
e to
tal c
ost
of p
ower
out
ages
to
the
U.S
. eac
h ye
ar, a
nd t
he p
erce
ived
ab
ility
of D
PV
to
dec
reas
e th
e in
cid
ence
of
out
ages
.
Sec
tor
Min
Max
Res
iden
tial
0.02
80.
41
Com
mer
cial
11.7
714
.40
Ind
ustr
ial
0.4
1.99
Sou
rce:
The
Nat
iona
l Res
earc
h C
ounc
il, 2
010
Dis
rup
tion
Valu
e R
ang
e b
y S
ecto
r (c
ents
/kW
h $2
012)
37
INS
IGH
TS
& IM
PLI
CAT
ION
S
•Th
e va
lue
of in
crea
sed
rel
iab
ility
is s
igni
fican
t, b
ut t
here
is a
nee
d t
o q
uant
ify a
nd d
emon
stra
te h
ow
muc
h va
lue
can
be
pro
vid
ed b
y D
PV.
Rul
es-o
f-th
umb
ass
ump
tions
and
cal
cula
tions
for
secu
rity
imp
acts
req
uire
sig
nific
ant
anal
ysis
and
rev
iew
.
•O
pp
ortu
nitie
s to
leve
rage
com
bin
atio
ns o
f dis
trib
uted
tec
hnol
ogie
s to
incr
ease
cus
tom
er r
elia
bili
ty a
re
star
ting
to b
e te
sted
. The
val
ue o
f DP
V in
incr
easi
ng s
upp
ling
pow
er d
urin
g ou
tage
s ca
n on
ly b
e re
aliz
ed if
DP
V is
cou
ple
d w
ith s
tora
ge a
nd e
qui
pp
ed w
ith t
he c
apab
ility
to
isla
nd it
self
from
the
grid
d
urin
g a
pow
er o
utag
e, w
hich
com
e at
ad
diti
onal
cap
ital c
ost.
LOO
KIN
G F
OR
WA
RD
Any
dis
trib
uted
res
ourc
es t
hat
can
be
inst
alle
d n
ear
the
end
use
r to
red
uce
use
of, a
nd c
onge
stio
n al
ong,
the
T&
D n
etw
ork
coul
d p
oten
tially
red
uce
tran
smis
sion
str
ess.
Thi
s in
clud
es t
echn
olog
ies
that
allo
w e
nerg
y to
be
used
mor
e ef
ficie
ntly
or
at d
iffer
ent
times
, red
ucin
g th
e q
uant
ity o
f ele
ctric
ity t
rave
ling
thro
ugh
the
T&D
ne
twor
k (e
spec
ially
dur
ing
pea
k ho
urs)
. Any
dis
trib
uted
tec
hnol
ogie
s w
ith t
he c
apab
ility
to
be
isla
nded
from
th
e gr
id c
ould
als
o p
lay
a ro
le.
01
23
CP
R (N
J/P
N) 2
012
NR
EL
2008
(cen
ts/k
Wh
$201
2)
RE
LIA
BIL
ITY
AN
D R
ES
ILIE
NC
Y B
EN
EFI
T
AN
D C
OS
T E
ST
IMAT
ES
AS
RE
PO
RT
ED
BY
RE
VIE
WE
D S
TU
DIE
S
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 37
of 5
9
38
EN
VIR
ON
ME
NT:
CA
RB
ON
VALU
E O
VE
RV
IEW
The
ben
efits
of r
educ
ing
carb
on e
mis
sion
s in
clud
e (1
) red
ucin
g fu
ture
com
plia
nce
cost
s, c
arb
on t
axes
, or
othe
r fe
es, a
nd
(2) m
itiga
ting
the
heat
h an
d e
cosy
stem
dam
ages
pot
entia
lly c
ause
d b
y cl
imat
e ch
ange
.
AP
PR
OA
CH
OV
ER
VIE
WB
y an
d la
rge,
stu
die
s th
at a
dd
ress
ed c
arb
on fo
cuse
d o
n th
e co
mp
lianc
e co
sts
or fe
es a
ssoc
iate
d w
ith fu
ture
car
bon
em
issi
ons,
and
con
clud
e th
at c
arb
on r
educ
tion
can
incr
ease
DP
V’s
val
ue b
y m
ore
than
tw
o ce
nts
per
kilo
wat
t-ho
ur,
dep
end
ing
heav
ily o
n th
e p
rice
pla
ced
on
carb
on. W
hile
the
re is
som
e ag
reem
ent
that
car
bon
red
uctio
n p
rovi
des
val
ue
and
on
the
gene
ral f
orm
ulat
ion
of c
arb
on v
alue
, the
re a
re w
idel
y va
ryin
g as
sum
ptio
ns, a
nd n
ot a
ll st
udie
s in
clud
e ca
rbon
va
lue.
Car
bon
red
uctio
n b
enefi
t is
the
am
ount
of c
arb
on d
isp
lace
d t
imes
the
pric
e of
red
ucin
g a
ton
of c
arb
on. T
he a
mou
nt o
f ca
rbon
dis
pla
ced
is d
irect
ly li
nked
to
the
amou
nt o
f ene
rgy
dis
pla
ced
, whe
n it
is d
isp
lace
d, a
nd t
he c
arb
on in
tens
ity o
f th
e re
sour
ce b
eing
dis
pla
ced
.
WH
Y A
ND
HO
W V
ALU
ES
DIF
FER
•S
yste
m C
ont
ext:
•M
arg
inal
res
our
ce -
Diff
eren
t re
sour
ces
may
be
on t
he m
argi
n in
diff
eren
t re
gion
s or
with
diff
eren
t so
lar
pen
etra
tions
. Car
bon
red
uctio
n is
sig
nific
antly
diff
eren
t if
ener
gy is
dis
pla
ced
from
coa
l, ga
s co
mb
ined
cyc
les,
or
gas
com
bus
tion
turb
ines
.•
Inp
ut A
ssum
pti
ons
:
•Va
lue
of
carb
on
red
ucti
on
- S
tud
ies
have
wid
ely
vary
ing
assu
mp
tions
ab
out
the
pric
e or
car
bon
. Som
e st
udie
s b
ase
pric
e on
rep
orte
d p
rices
in E
urop
ean
mar
kets
, oth
ers
on fo
reca
sts
bas
ed o
n p
olic
y ex
pec
tatio
ns, o
ther
s on
a
com
bin
atio
n. T
he in
crea
sed
unc
erta
inty
aro
und
U.S
. Fed
eral
car
bon
legi
slat
ion
has
mad
e p
rice
estim
ates
mor
e d
ifficu
lt.•
Hea
t ra
tes
of
mar
gin
al r
eso
urce
s -
The
assu
med
effi
cien
cy o
f the
mar
gina
l pow
er p
lant
is d
irect
ly c
orre
late
d t
o am
ount
of c
arb
on d
isp
lace
d b
y D
PV.
•M
etho
do
log
ies:
•A
dd
er v
s. s
tand
-alo
ne v
alue
- T
here
is n
o co
mm
on a
pp
roac
h to
whe
ther
car
bon
is r
epre
sent
ed a
s a
stan
d-
alon
e va
lue
(for
exam
ple
, NR
EL
2008
and
E3
2012
) or
as a
n ad
der
to
ener
gy v
alue
(for
exa
mp
le, A
PS
201
3).
•Le
vel o
f g
ranu
lari
ty/w
hat’s
on
the
mar
gin
- J
ust
as w
ith e
nerg
y (w
hich
is d
irect
ly li
nked
to
carb
on r
educ
tion)
, st
udie
s ta
ke o
ne o
f thr
ee g
ener
al a
pp
roac
hes:
(1) D
PV
dis
pla
ces
ener
gy fr
om a
gas
pla
nt, g
ener
ally
a c
omb
ined
cy
cle,
(2) D
PV
dis
pla
ces
ener
gy fr
om o
ne t
ype
of p
lant
(gen
eral
ly a
com
bin
ed c
ycle
) off-
pea
k an
d a
diff
eren
t ty
pe
of p
lant
(gen
eral
ly a
com
bus
tion
turb
ine)
on-
pea
k, (3
) DP
V d
isp
lace
s w
hate
ver
reso
urce
is o
n th
e m
argi
n d
urin
g ev
ery
hour
of t
he y
ear,
bas
ed o
n a
dis
pat
ch a
naly
sis.
BE
NE
FIT
AN
D C
OS
T E
ST
IMAT
ES
AS
R
EP
OR
TE
D B
Y R
EV
IEW
ED
ST
UD
IES
02
35
6C
ross
bor
der
(CA
) 201
3
E3
2012
NR
EL
2008
R. D
uke
2005
(cen
ts/k
Wh
$201
2)
02
46
Cro
ssb
ord
er (A
Z) 2
013
CP
R (T
X) 2
013
AE
/CP
R 2
012
CP
R (N
J/PA
) 201
2
AE
/CP
R 2
006
Vote
Sol
ar 2
005
(cen
ts/k
Wh
$201
2)
Ran
ge o
f Ben
efits
and
Cos
ts fr
om S
tud
ies
that
Eva
luat
e C
arb
on S
epar
atel
y
Ran
ge o
f Ben
efits
and
Cos
ts fr
om S
tud
ies
that
G
roup
All
Env
ironm
enta
l Val
ues
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 38
of 5
9
39
EN
VIR
ON
ME
NT:
CA
RB
ON
(CO
NT’
D)
INS
IGH
TS
& IM
PLI
CAT
ION
S
• Ju
st a
s w
ith e
nerg
y va
lue,
car
bon
val
ue d
epen
ds
heav
ily o
n w
hat
the
mar
gina
l res
ourc
e is
tha
t is
bei
ng
dis
pla
ced
. The
sam
e d
eter
min
atio
n of
the
mar
gina
l res
ourc
e sh
ould
be
used
to
driv
e b
oth
ener
gy a
nd
carb
on v
alue
s.
• W
hile
the
re is
litt
le a
gree
men
t on
wha
t th
e $/
ton
pric
e of
car
bon
is o
r sh
ould
be,
it is
like
ly n
on-z
ero.
KE
Y D
RIV
ER
S O
F VA
LUE
AN
D M
AIN
A
SS
UM
PT
ION
S
0
3.00
6.00
9.00
12.0
0
15.0
0
020
4060
8010
0
Value (cents/kWh $2012)
2012
$/
ton
CO
2
Car
bo
n P
rice
Sen
sitiv
ity
CA
EU
Aus
Coa
lN
atur
al g
as
Hea
t R
ate
Sen
sitiv
ity
0
3.00
6.00
9.00
12.0
0
15.0
0
8000
9000
1000
011
000
1200
0
Value (cents/kWh $2012)
Hea
t R
ate
(MM
Btu
/kW
h)
Coa
l: $1
00/t
CO
2N
at. G
as: $
100/
tCO
2C
oal:
$20/
tCO
2N
at. G
as: $
20/t
CO
2
How
muc
h ca
rbon
DP
V d
isp
lace
s d
epen
ds
on
the
dis
pat
ch o
rder
of o
ther
res
ourc
es,
whe
n th
e so
lar
is g
ener
ated
, and
how
m
uch
is g
ener
ated
.
LOO
KIN
G F
OR
WA
RD
Whi
le t
here
has
bee
n no
Fed
eral
act
ion
on c
limat
e ov
er t
he la
st fe
w y
ears
, lea
din
g to
gre
ater
unc
erta
inty
ab
out
pot
entia
l fut
ure
pric
es, m
any
stat
es a
nd u
tiliti
es c
ontin
ue t
o va
lue
carb
on a
s a
refle
ctio
n of
ass
umed
b
enefi
t. T
here
ap
pea
rs t
o b
e in
crea
sing
like
lihoo
d t
hat
the
US
Env
ironm
enta
l Pro
tect
ion
Age
ncy
will
tak
e ac
tion
to li
mit
emis
sion
s fr
om c
oal p
lant
s, p
oten
tially
pro
vid
ing
a m
ore
conc
rete
ind
icat
or o
f pric
e.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 39
of 5
9
40
EN
VIR
ON
ME
NT:
OTH
ER
FA
CTO
RS
CR
ITE
RIA
AIR
P
OLL
UTA
NTS
WAT
ER
LAN
D
In a
dd
ition
to
carb
on, D
PV
has
sev
eral
oth
er e
nviro
nmen
tal b
enefi
ts (o
r p
oten
tially
cos
ts) t
hat,
whi
le c
omm
only
ack
now
led
ged
, are
incl
uded
in o
nly
a fe
w o
f the
stu
die
s re
view
ed h
ere.
Th
at s
aid
, the
re is
a s
igni
fican
t b
ody
of t
houg
ht fo
r ea
ch o
utsi
de
the
real
m o
f DP
V c
ost/
ben
efit
valu
atio
n.
SU
MM
AR
Y: C
riter
ia a
ir p
ollu
tant
s (N
OX
, SO
2, a
nd
par
ticul
ate
mat
ter)
rel
ease
d fr
om t
he b
urni
ng o
f fos
sil
fuel
s ca
n p
rod
uce
bot
h he
alth
and
eco
syst
em d
amag
es.
The
econ
omic
cos
t of
the
se p
ollu
tant
s is
gen
eral
ly
estim
ated
as:
1. T
he c
omp
lianc
e co
sts
of r
educ
ing
pol
luta
nt
emis
sion
s fr
om p
ower
pla
nts,
or
the
add
ed
com
plia
nce
cost
s to
furt
her
dec
reas
e em
issi
ons
bey
ond
som
e b
asel
ine
stan
dar
d; a
nd/o
r
2. T
he e
stim
ated
cos
t of
dam
ages
, suc
h as
med
ical
ex
pen
ses
for
asth
ma
pat
ient
s or
the
val
ue o
f m
orta
lity
risk,
whi
ch a
ttem
pts
to
mea
sure
w
illin
gnes
s to
pay
for
a sm
all r
educ
tion
in r
isk
of
dyi
ng d
ue t
o ai
r p
ollu
tion.
VALU
E: C
ross
bor
der
(AZ
) 201
3 es
timat
ed t
he v
alue
of
crite
ria a
ir p
ollu
tant
red
uctio
ns, b
ased
on
AP
S’s
In
tegr
ated
Res
ourc
e P
lan,
as
$0.3
65/M
Wh,
and
NR
EL
2008
as
$0.2
-14/
MW
h (2
012$
). C
PR
(NJ/
PA) 2
012
and
A
E/C
PR
201
2 al
so a
ckno
wle
dge
d c
riter
ia a
ir p
ollu
tant
s,
but
est
imat
e co
st b
ased
on
a co
mb
ined
env
ironm
enta
l va
lue.
SU
MM
AR
Y: C
oal a
nd n
atur
al g
as p
ower
pla
nts
with
dra
w a
nd c
onsu
me
wat
er p
rimar
ily fo
r co
olin
g.
Ap
pro
ache
s to
val
uing
red
uced
wat
er u
sage
hav
e fo
cuse
d o
n th
e co
st o
r va
lue
of w
ater
in c
omp
etin
g se
ctor
s, p
oten
tially
incl
udin
g m
unic
ipal
, agr
icul
tura
l, an
d
envi
ronm
enta
l/rec
reat
iona
l use
s.
SU
MM
AR
Y: D
PV
can
imp
act
land
in t
hree
way
s:
1. C
hang
e in
pro
per
ty v
alue
with
the
ad
diti
on o
f DP
V;2.
Lan
d r
equi
rem
ent;
or
3. E
cosy
stem
imp
acts
.
RE
SO
UR
CE
S:
RE
SO
UR
CE
S:
RE
SO
UR
CE
S:
Ep
stei
n, P
., B
uono
core
, J.,
Eck
erle
, K. e
t al
., Fu
ll C
ost
Acc
ount
ing
for
the
Life
Cyc
le o
f Coa
l, 20
11.
Mul
ler,
N.,
Men
del
sohn
, R.,
Nor
dha
us, W
., E
nviro
nmen
tal
Acc
ount
ing
for
Pol
lutio
n in
the
US
Eco
nom
y. A
mer
ican
Eco
nom
ic
Rev
iew
101
, Aug
. 201
1. p
p. 1
649
- 16
75.
Nat
iona
l Res
earc
h C
ounc
il. H
idd
en C
osts
of E
nerg
y: U
npric
ed
Con
seq
uenc
es o
f Ene
rgy
Pro
duc
tion
and
Use
, 201
0.
Telli
nghu
lsen
, S.,
Eve
ry D
rop
Cou
nts.
Wes
tern
Res
ourc
es A
dvo
cate
s,
Jan.
201
1.
Fthe
naki
s, V
., H
yung
l, C
., Li
fe-c
ycle
Use
of W
ater
in U
.S. E
lect
ricity
G
ener
atio
n. R
enew
able
and
Sus
tain
able
Ene
rgy
Rev
iew
14,
Sep
t.
2010
. pp
.203
9-20
48.
WAT
ER
CO
NS
UM
PT
ION
BY
TE
CH
NO
LOG
Y
VALU
E: T
he o
nly
stud
y re
view
ed t
hat
exp
licitl
y va
lues
w
ater
red
uctio
n is
Cro
ssb
ord
er (A
Z) 2
013,
whi
ch
estim
ates
a $
1.08
4/M
Wh
valu
e b
ased
on
AP
S’s
IRP.
VALU
E: N
one
of t
he s
tud
ies
revi
ewed
exp
licitl
y es
timat
e la
nd im
pac
ts.
0
0.5
1.0
1.5
Coal
CSP
Nuclear
Oil/Gas
Natural Gas
Biomass
PV
Wind
(gals/kWh)
0102030
Natural Gas (C
C)Wind, arra
y spacing Solar CSP
PV (Ground)
Coal
NuclearGeotherm
al Wind, footprint
LIFE
-CY
CLE
LA
ND
US
E B
Y T
EC
HN
OLO
GY
(acres/MW)
Sou
rce:
Fth
enak
isS
ourc
e: G
ood
rich
Goo
dric
h et
al.
Res
iden
tial,
Com
mer
cial
, and
Util
ity S
cale
P
hoto
volta
ic (V
) Sys
tem
Pric
es in
the
Uni
ted
Sta
tes:
Cur
rent
Driv
ers
and
Cos
t-R
educ
tion
Op
por
tuni
ties.
�NR
EL.
Feb
ruar
y 20
12. P
ages
14,
23
—28
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 40
of 5
9
SO
CIA
L: E
CO
NO
MIC
DE
VE
LOP
ME
NT
VALU
E O
VE
RV
IEW
The
assu
med
soc
ial v
alue
from
DP
V is
bas
ed o
n an
y jo
b a
nd e
cono
mic
gro
wth
ben
efits
tha
t D
PV
brin
gs t
o th
e ec
onom
y, in
clud
ing
job
s an
d h
ighe
r ta
x re
venu
e. T
he v
alue
of e
cono
mic
dev
elop
men
t d
epen
ds
on
num
ber
of j
obs
crea
ted
or
dis
pla
ced
, as
mea
sure
d b
y a
job
mul
tiplie
r, as
wel
l as
the
valu
e of
eac
h jo
b, a
s m
easu
red
by
aver
age
sala
ry a
nd/o
r ta
x re
venu
e.
AP
PR
OA
CH
OV
ER
VIE
W
Very
few
stu
die
s re
view
ed q
uant
ify e
mp
loym
ent
and
tax
rev
enue
val
ue, a
lthou
gh a
num
ber
of t
hem
ac
know
led
ge t
he v
alue
. CP
R (N
J/P
N) 2
012
calc
ulat
ed jo
b im
pac
t b
ased
on
enha
nced
tax
rev
enue
s as
soci
ated
with
the
net
job
cre
atin
g fo
r so
lar
vs c
onve
ntio
nal p
ower
res
ourc
es. T
he 2
011
stud
y in
clud
ed
incr
ease
d t
ax r
even
ue, d
ecre
ased
une
mp
loym
ent,
and
incr
ease
d c
onfid
ence
for
bus
ines
s d
evel
opm
ent
econ
omic
gro
wth
ben
efits
, but
onl
y q
uant
ified
the
tax
rev
enue
ben
efit.
41
IMP
LIC
ATIO
NS
AN
D IN
SIG
HT
S
•Th
ere
is s
igni
fican
t va
riab
ility
in t
he r
ange
of j
ob m
ultip
liers
.
•M
any
of t
he jo
bs
crea
ted
from
PV,
par
ticul
arly
tho
se a
ssoc
iate
d w
ith in
stal
latio
n, a
re lo
cal,
so t
here
can
b
e va
lue
to s
ocie
ty a
nd lo
cal c
omm
uniti
es fr
om g
row
th in
qua
ntity
and
qua
lity
of jo
bs
avai
lab
le. T
he
loca
tions
whe
re jo
bs
are
crea
ted
are
like
ly n
ot t
he s
ame
as w
here
job
s ar
e lo
st. W
hile
the
re c
ould
be
a ne
t b
enefi
t to
soc
iety
, som
e re
gion
s co
uld
bea
r a
net
cost
from
the
tra
nsiti
on in
the
job
mar
ket.
•W
hile
em
plo
ymen
t an
d t
ax r
even
ues
have
not
gen
eral
ly b
een
qua
ntifi
ed in
stu
die
s re
view
ed, E
3 20
11
reco
mm
end
s an
inp
ut-o
utp
ut m
odel
ing
app
roac
h as
an
adeq
uate
rep
rese
ntat
ion
of t
his
valu
e.
Sou
rces
: Wei
, 201
0
Job-year/GWh
EC
ON
OM
IC D
EV
ELO
PM
EN
T B
EN
EFI
T
AN
D C
OS
T E
ST
IMAT
ES
AS
RE
PO
RT
ED
BY
RE
VIE
WE
D S
TU
DIE
S
01
23
45
CP
R (N
J/PA
) 201
2
NR
EL
2008
(cen
ts/k
Wh
$201
2)
0
0.250.
5
0.751
Solar
EE
Wind
Nuclear
Coal
Natural Gas
Small Hydro
Job
Mul
tiplie
rs b
y In
dus
try
RE
SO
UR
CE
S:
Wei
, M.,
Pat
adia
, S.,
and
Kam
men
, D.,
Put
ting
Ren
ewab
les
and
Ene
rgy
Effi
cien
cy t
o W
ork:
How
Man
y Jo
bs
Can
the
Ene
rgy
Ind
ustr
y G
ener
ate
in t
he U
S?
Ene
rgy
Pol
icy
38, 2
010.
pp
. 919
-931
.
Bro
okin
gs In
stitu
te, S
izin
g th
e C
lean
Eco
nom
y: A
Nat
iona
l and
Reg
iona
l Gre
en J
obs
Ass
essm
ent,
201
1.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 41
of 5
9
04STU
DY
OV
ER
VIE
WS
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 42
of 5
9
RW
BE
CK
FO
R A
RIZ
ON
AP
UB
LIC
SE
RV
ICE,2
009
DIS
TRIB
UTE
DR
EN
EW
AB
LE E
NE
RG
YO
PE
RAT
ING
IMPA
CTS
&V
ALU
ATIO
N S
TUD
Y
43
Sys
tem
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To
det
erm
ine
the
pot
entia
l val
ue o
f DP
V fo
r A
rizon
a P
ublic
Ser
vice
, and
to
und
erst
and
the
like
ly o
per
atin
g im
pac
ts.
GE
OG
RA
PH
IC F
OC
US
Ariz
ona
Pub
lic S
ervi
ce t
errit
ory
SY
ST
EM
CO
NT
EX
TVe
rtic
ally
inte
grat
ed IO
U, 1
5% R
PS
by
2025
with
30%
dis
trib
uted
res
ourc
e ca
rveo
ut
LEV
EL
OF
SO
LAR
AN
ALY
ZE
D0.
2-16
% b
y 20
25 (b
y en
ergy
)
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
EU
tility
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISFe
eder
leve
l, ho
urly
, mea
sure
s in
crem
enta
l val
ue in
201
0, 2
015,
and
202
5
TO
OLS
US
ED
•A
BB
’s F
eed
er-A
ll•
EP
RI’s
Dis
trib
utio
n S
yste
m S
imul
ator
•P
RO
MO
D
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
Ene
rgy
= E
nerg
y p
rovi
des
the
larg
est
sour
ce o
f val
ue t
o th
e A
PS
sys
tem
. Val
ue is
ca
lcul
ated
bas
ed o
n a
PR
OM
OD
hou
rly c
omm
itmen
t an
d d
isp
atch
sim
ulat
ion.
DP
V
red
uces
fuel
, pur
chas
ed p
ower
req
uire
men
ts, l
ine
loss
es, a
nd fi
xed
O&
M. T
he
natu
ral g
as p
rice
fore
cast
is b
ased
on
NY
ME
X fo
rwar
d p
rices
with
ad
just
men
t fo
r d
eliv
ery
to A
PS
’s s
yste
m.
Gen
erat
ion
cap
acit
y =
The
re is
litt
le, b
ut s
ome,
gen
erat
ion
cap
acity
val
ue.
Gen
erat
ion
cap
acity
val
ue d
oes
not
diff
er b
ased
on
the
geog
rap
hic
loca
tion
of
sola
r, b
ut g
ener
atio
n ca
pac
ity in
vest
men
ts a
re “
lum
py”
, so
a si
gnifi
cant
am
ount
of
sola
r is
nee
ded
to
dis
pla
ce it
.
Cap
acity
val
ue in
clud
es b
enefi
ts fr
om r
educ
ed lo
sses
. Cap
acity
val
ue is
d
eter
min
ed b
y co
mp
arin
g D
PV
’s d
epen
dab
le c
apac
ity (d
eter
min
ed a
s th
e E
LCC
) to
AP
S’s
gen
erat
ion
inve
stm
ent
pla
n.
T&
D c
apac
ity
= T
here
is v
ery
little
dis
trib
utio
n ca
pac
ity v
alue
, and
wha
t va
lue
exis
ts c
omes
from
tar
getin
g sp
ecifi
c fe
eder
s. S
olar
gen
erat
ion
pea
ks e
arlie
r in
the
d
ay t
han
the
syst
em’s
pea
k lo
ad, D
PV
onl
y ha
s va
lue
if it
is o
n a
feed
er t
hat
is
faci
ng a
n ov
erlo
aded
con
diti
on, a
nd D
PV
’s d
epen
dab
le c
apac
ity d
imin
ishe
s as
so
lar
pen
etra
tion
incr
ease
s. D
istr
ibut
ion
valu
e in
clud
es c
apac
ity, e
xten
sion
of
serv
ice
life,
red
uctio
n in
eq
uip
men
t si
zing
, and
sys
tem
per
form
ance
issu
es.
Ther
e is
litt
le, b
ut s
ome,
tra
nsm
issi
on c
apac
ity v
alue
sin
ce v
alue
doe
s no
t d
iffer
b
ased
on
the
geog
rap
hic
loca
tion
of s
olar
, but
tra
nsm
issi
on in
vest
men
ts a
re
“lum
py”
, so
a si
gnifi
cant
am
ount
of s
olar
is n
eed
ed t
o d
isp
lace
d it
. Tra
nsm
issi
on
valu
e in
clud
es c
apac
ity a
nd p
oten
tial d
etrim
enta
l im
pac
ts t
o tr
ansi
ent
stab
ility
and
sp
inni
ng r
esou
rces
(i.e
., an
cilla
ry s
ervi
ces)
.
T&D
cap
acity
val
ue in
clud
es b
enefi
ts fr
om r
educ
ed lo
sses
, mod
eled
with
a
com
bin
atio
n of
hou
rly s
yste
m-w
ide
and
feed
er-s
pec
ific
mod
elin
g. T
&D
cap
acity
va
lue
is d
eter
min
ed b
y co
mp
arin
g D
PV
’s d
epen
dab
le c
apac
ity t
o A
PS
’s T
&D
in
vest
men
t p
lan.
For
T&
D, a
s co
mp
ared
to
gene
ratio
n, d
epen
dab
le c
apac
ity is
d
eter
min
ed a
s th
e le
vel o
f sol
ar o
utp
ut t
hat
will
occ
ur w
ith 9
0% c
onfid
ence
dur
ing
the
dai
ly fi
ve h
ours
of p
eak
dur
ing
sum
mer
mon
ths.
Hig
hlig
hts
•Th
e st
udy
app
roac
h co
mb
ined
sys
tem
mod
elin
g, e
mp
irica
l tes
ting,
and
info
rmat
ion
revi
ew, a
nd
rep
rese
nts
one
of t
he m
ore
tech
nica
lly r
igor
ous
app
roac
hes
of r
evie
wed
stu
die
s.
•A
key
met
hod
olog
ical
ass
ump
tion
in t
he s
tud
y is
tha
t ge
nera
tion,
tra
nsm
issi
on, a
nd d
istr
ibut
ion
cap
acity
val
ue c
an o
nly
be
give
n to
DP
V w
hen
it ac
tual
ly d
efer
s or
avo
ids
a p
lann
ed in
vest
men
t.
The
imp
licat
ions
are
tha
t a
cert
ain
min
imum
am
ount
of D
PV
mus
t b
e in
stal
led
in a
cer
tain
tim
e p
erio
d (a
nd in
a c
erta
in lo
catio
n fo
r d
istr
ibut
ion
cap
acity
) to
crea
te v
alue
.
•Th
e st
udy
det
erm
ines
tha
t to
tal v
alue
dec
reas
es o
ver
time,
prim
arily
driv
en b
y d
ecre
asin
g ca
pac
ity
valu
e. In
crea
sing
leve
ls o
f DP
V e
ffect
ivel
y p
ushe
s th
e sy
stem
pea
k to
late
r ho
urs.
•Th
e st
udy
ackn
owle
dge
d b
ut d
id n
ot q
uant
ify a
num
ber
of o
ther
val
ues
incl
udin
g jo
b c
reat
ion,
a
mor
e su
stai
nab
le e
nviro
nmen
t, c
arb
on r
educ
tion,
and
incr
ease
d w
orke
r p
rod
uctiv
ity.
05101520
Ene
rgy
Gen
Cap
T&D
Cap
Tota
l
(cents/kWh $2012)
11.7
5
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
*thi
s ch
art
rep
rese
nts
the
pre
sent
val
ue o
f 202
5 in
crem
enta
l val
ue, n
ot a
leve
lized
cos
t
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 43
of 5
9
44
SA
IC F
OR
AR
IZO
NA
PU
BLI
CS
ER
VIC
E,2
013
2013
UP
DAT
ED
SO
LAR
PV
VA
LUE
RE
PO
RT
Stu
dy
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To u
pd
ate
the
valu
atio
n of
futu
re D
PV
sys
tem
s in
the
Ariz
ona
Pub
lic
Ser
vice
(AP
S) t
errit
ory
inst
alle
d a
fter
201
2.
GE
OG
RA
PH
IC F
OC
US
Ariz
ona
Pub
lic S
ervi
ce t
errit
ory
SY
ST
EM
CO
NT
EX
TVe
rtic
ally
inte
grat
ed IO
U, 1
5% R
PS
by
2025
with
30%
dis
trib
uted
re
sour
ce c
arve
out
, pea
k ex
tend
s p
ast
suns
et
LEV
EL
OF
SO
LAR
AN
ALY
ZE
D4.
5-16
% b
y 20
25 (b
y en
ergy
)
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ER
atep
ayer
s
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISFe
eder
leve
l, ho
urly
, mea
sure
s in
crem
enta
l val
ue in
201
5, 2
020,
and
202
5
TO
OLS
US
ED
•N
RE
L’s
SA
M 2
.0•
EP
RI’s
DS
S D
istr
ibut
ion
Feed
er M
odel
•P
RO
MO
D
Hig
hlig
hts
•D
PV
pro
vid
es le
ss v
alue
tha
n in
AP
S’s
200
9 st
udy,
due
to
chan
ging
pow
er m
arke
t an
d s
yste
m
cond
ition
s. E
nerg
y ge
nera
tion
and
who
lesa
le p
urch
ase
cost
s ha
ve d
ecre
ased
due
to
low
er n
atur
al
gas
pric
es. E
xpec
ted
CO
2 co
sts
are
sign
ifica
ntly
low
er d
ue t
o d
ecre
ased
like
lihoo
d o
f Fed
eral
le
gisl
atio
n. L
oad
fore
cast
s ar
e lo
wer
, mea
ning
red
uced
gen
erat
ion,
dis
trib
utio
n an
d t
rans
mis
sion
ca
pac
ity r
equi
rem
ents
.
•Th
e st
udy
note
s th
e p
oten
tial f
or in
crea
sed
val
ue (p
rimar
ily in
T&
D c
apac
ity) i
f DP
V c
an b
e ge
ogra
phi
cally
tar
gete
d in
suf
ficie
nt q
uant
ities
. How
ever
, it
note
s th
at a
ctua
l dep
loym
ent
sinc
e th
e 20
09 s
tud
y d
oes
not
show
sig
nific
ant
clus
terin
g or
tar
getin
g.
•Li
ke t
he 2
009
stud
y, c
apac
ity v
alue
is a
ssum
ed t
o b
e b
ased
on
DP
V’s
ab
ility
to
def
er p
lann
ed
inve
stm
ents
, rat
her
than
ass
umin
g ev
ery
inst
alle
d u
nit
of D
PV
def
ers
cap
acity
.
Ene
rgy
= E
nerg
y p
rovi
des
the
larg
est
sour
ce o
f val
ue t
o th
e A
PS
sys
tem
. Val
ue is
ca
lcul
ated
bas
ed o
n a
PR
OM
OD
hou
rly c
omm
itmen
t an
d d
isp
atch
sim
ulat
ion.
DP
V
red
uces
fuel
, pur
chas
ed p
ower
req
uire
men
ts, l
ine
loss
es, a
nd fi
xed
O&
M. T
he
natu
ral g
as p
rice
fore
cast
is b
ased
on
NY
ME
X fo
rwar
d p
rices
with
ad
just
men
t fo
r d
eliv
ery
to A
PS
’s s
yste
m. E
nerg
y lo
sses
are
incl
uded
as
par
t of
ene
rgy
valu
e, a
nd
unlik
e th
e 20
09 r
epor
t, a
re b
ased
on
a re
cord
ed a
vera
ge e
nerg
y lo
ss.
Gen
erat
ion
cap
acit
y =
Gen
erat
ion
cap
acity
val
ue is
hig
hly
dep
end
ent
on D
PV
’s
dep
end
able
cap
acity
dur
ing
pea
k. G
ener
atio
n ca
pac
ity v
alue
is b
ased
on
PR
OM
OD
sim
ulat
ions
, and
res
ults
in t
he d
efer
ral o
f com
bus
tion
turb
ines
. Ben
efits
fr
om a
void
ed e
nerg
y lo
sses
are
incl
uded
as
par
t of
cap
acity
val
ue, a
nd u
nlik
e th
e 20
09 r
epor
t, a
re b
ased
on
a re
cord
ed p
eak
dem
and
loss
. Lik
e th
e 20
09 s
tud
y,
gene
ratio
n ca
pac
ity v
alue
is b
ased
on
an E
LCC
cal
cula
tion.
T&
D c
apac
ity
= T
he s
tud
y co
nclu
des
tha
t th
ere
are
an in
suffi
cien
t nu
mb
er o
f fe
eder
s th
at c
an d
efer
cap
acity
up
grad
es b
ased
on
non-
targ
eted
sol
ar P
V
inst
alla
tions
to
det
erm
ine
mea
sura
ble
cap
acity
sav
ings
. Dis
trib
utio
n ca
pac
ity
savi
ngs
can
only
be
real
ized
if d
istr
ibut
ed s
olar
sys
tem
s ar
e in
stal
led
at
adeq
uate
p
enet
ratio
n le
vels
and
loca
ted
on
spec
ific
feed
ers
to r
elie
ve c
onge
stio
n or
del
ay
spec
ific
pro
ject
s, b
ut s
olar
ad
optio
n ha
s b
een
geog
rap
hica
lly d
isp
erse
d.
Dis
trib
utio
n va
lue
incl
udes
red
uced
loss
es, c
apac
ity, e
xten
ded
ser
vice
life
, and
re
duc
ed e
qui
pm
ent
sizi
ng.
Tran
smis
sion
cap
acity
val
ue is
hig
hly
dep
end
ent
on D
PV
’s d
epen
dab
le c
apac
ity
dur
ing
pea
k. N
o tr
ansm
issi
on p
roje
cts
can
be
def
erre
d m
ore
than
one
yea
r, an
d
none
pas
t th
e ta
rget
yea
rs. A
s w
ith t
he 2
009
stud
y, D
PV
dep
end
able
cap
acity
for
the
pur
pos
es o
f T&
D b
enefi
ts is
cal
cula
ted
bas
ed o
n a
90%
con
fiden
ce o
f ge
nera
tion
dur
ing
pea
k su
mm
er h
ours
. Ben
efits
from
avo
ided
ene
rgy
loss
es a
re
incl
uded
.
*thi
s ch
art
rep
rese
nts
the
pre
sent
val
ue o
f 202
5 in
crem
enta
l val
ue, n
ot a
leve
lized
cos
t
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
01234
Ene
rgy
Gen
Cap
T&D
Cap
Tota
l
(cents/kWh $2012)
3.56
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 44
of 5
9
45
CR
OS
SB
OR
DE
RE
NE
RG
Y,2
013
THE
BE
NE
FITS
AN
D C
OS
TS O
F S
OLA
RD
ISTR
IBU
TED
GE
NE
RAT
ION
FO
R A
RIZ
ON
AP
UB
LIC
SE
RV
ICE
Sys
tem
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To d
eter
min
e ho
w d
eman
d-s
ide
sola
r w
ill im
pac
t A
PS
’s
rate
pay
ers;
a r
esp
onse
to
the
AP
S 2
013
stud
y.
GE
OG
RA
PH
IC F
OC
US
Ariz
ona
Pub
lic S
ervi
ce t
errit
ory
SY
ST
EM
CO
NT
EX
TVe
rtic
ally
inte
grat
ed IO
U, 1
5% R
PS
by
2025
LEV
EL
OF
SO
LAR
AN
ALY
ZE
DD
PV
like
ly t
o b
e in
stal
led
bet
wee
n 20
13-2
015;
est
imat
ed h
ere
to b
e ap
pro
xim
atel
y 1.
5%
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ER
atep
ayer
s
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISD
eriv
ed fr
om A
PS
201
3
TO
OLS
US
ED
•S
econ
dar
y an
alys
is b
ased
on
SA
IC a
nd A
PS
det
aile
d
mod
elin
g
Hig
hlig
hts
•Th
e b
enefi
ts o
f DP
V o
n th
e A
PS
sys
tem
exc
eed
the
cos
t b
y m
ore
than
50%
. Key
met
hod
olog
ical
d
iffer
ence
s b
etw
een
this
stu
dy
and
the
AP
S 2
009
and
201
3 st
udie
s in
clud
e:
•D
eter
min
ing
valu
e le
veliz
ed o
ver
20 y
ears
, as
com
par
ed t
o in
crem
enta
l val
ue in
tes
t ye
ars.
•C
red
iting
cap
acity
val
ue t
o ev
ery
unit
of s
olar
DG
inst
alle
d, r
athe
r th
an r
equi
ring
sola
r D
G t
o b
e in
stal
led
in “
lum
py”
incr
emen
ts.
•U
sing
ELC
C t
o d
eter
min
e d
epen
dab
le c
apac
ity fo
r ge
nera
tion,
tra
nsm
issi
on, a
nd d
istr
ibut
ion
cap
acity
val
ues,
as
com
par
ed t
o us
ing
ELC
C fo
r ge
nera
tion
cap
acity
and
a 9
0% c
onfid
ence
d
urin
g p
eak
sum
mer
hou
rs fo
r T&
D c
apac
ity.
•Fo
cusi
ng o
n so
lar
inst
alle
d o
ver
next
few
yea
rs y
ears
, rat
her
than
exa
min
ing
whe
ther
the
re is
d
imin
ishi
ng v
alue
with
incr
easi
ng p
enet
ratio
n.
•Th
e st
udy
note
s th
at D
PV
mus
t b
e co
nsid
ered
in t
he c
onte
xt o
f effi
cien
cy a
nd d
eman
d r
esp
onse
—to
geth
er t
hey
def
er g
ener
atio
n, t
rans
mis
sion
, and
dis
trib
utio
n ca
pac
ity u
ntil
2017
.
Ene
rgy
= A
void
ed e
nerg
y co
sts
are
the
mos
t si
gnifi
cant
sou
rce
of v
alue
. AP
S’s
long
-ter
m
mar
gina
l res
ourc
e is
ass
umed
to
be
a co
mb
ustio
n tu
rbin
e in
pea
k m
onth
s an
d a
co
mb
ined
cyc
le in
off-
pea
k m
onth
s, a
nd a
void
ed e
nerg
y is
bas
ed o
n th
ese
reso
urce
s. T
he
natu
ral g
as p
rice
fore
cast
is b
ased
on
NY
ME
X fo
rwar
d m
arke
t ga
s p
rices
, and
the
stu
dy
det
erm
ines
tha
t it
adeq
uate
ly c
aptu
res
the
fuel
pric
e he
dge
ben
efit.
Key
ass
ump
tions
: $1
5/to
n ca
rbon
ad
der
, 12.
1% li
ne lo
sses
incl
uded
in t
he e
nerg
y va
lue.
Gen
erat
ion
cap
acit
y =
Gen
erat
ion
cap
acity
val
ue is
cal
cula
ted
as
DP
V d
epen
dab
le
cap
acity
(bas
ed o
n D
PV
’s n
ear-
term
ELC
C fr
om A
PS
’s 2
012
IRP
) tim
es t
he fi
xed
cos
ts o
f a
gas
com
bus
tion
turb
ine.
Eve
ry in
stal
led
uni
t of
DP
V r
ecei
ves
that
cap
acity
val
ue, b
ased
on
the
ass
ump
tion
that
, whe
n co
uple
d w
ith e
ffici
ency
and
dem
and
res
pon
se, c
apac
ity
wou
ld h
ave
othe
rwis
e b
een
need
ed b
efor
e A
PS
’s p
lann
ed in
vest
men
t.
T&
D c
apac
ity
= T
&D
cap
acity
val
ue is
cal
cula
ted
as
DP
V d
epen
dab
le c
apac
ity (E
LCC
) tim
es A
PS
’s r
epor
ted
cos
ts o
f T&
D in
vest
men
ts. L
ike
gene
ratio
n ca
pac
ity, e
very
inst
alle
d
unit
is c
red
ited
with
T&
D c
apac
ity, w
ith t
he a
ssum
ptio
n th
at 5
0% o
f dis
trib
utio
n fe
eder
s ca
n se
e d
efer
ral b
enefi
t. T
he s
tud
y no
tes
that
AP
S c
ould
tak
e a
pro
activ
e ap
pro
ach
to
targ
etin
g D
PV
dep
loym
ent,
the
reb
y in
crea
sing
dis
trib
utio
n va
lue.
Gri
d S
upp
ort
(Anc
illar
y se
rvic
es) =
DP
V in
effe
ct r
educ
es lo
ad a
nd t
here
fore
red
uces
the
ne
ed fo
r an
cilla
ry s
ervi
ces
that
wou
ld o
ther
wis
e b
e re
qui
red
, inc
lud
ing
spin
ning
, non
-sp
inni
ng, a
nd c
apac
ity r
eser
ves.
Env
iro
nmen
t =
DP
V e
ffect
ivel
y re
duc
es lo
ad a
nd t
here
fore
red
uces
env
ironm
enta
l im
pac
ts t
hat
wou
ld o
ther
wis
e b
e in
curr
ed. L
ower
load
mea
ns r
educ
ed c
riter
ia a
ir p
ollu
tant
em
issi
ons
and
low
er w
ater
use
(car
bon
is in
clud
ed a
s an
ad
der
to
ener
gy v
alue
).
Ren
ewab
le V
alue
= D
PV
hel
ps
AP
S m
eet
its R
enew
able
Ene
rgy
Sta
ndar
d, t
here
by
low
erin
g A
PS
’s c
omp
lianc
e co
sts.
So
lar
Co
st =
Sin
ce t
he s
tud
y ta
kes
a ut
ility
per
spec
tive,
cos
ts in
clud
ed a
re lo
st r
etai
l rat
e re
venu
es, i
ncen
tive
pay
men
ts, a
nd in
tegr
atio
n co
sts.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
-20
-100102030
(cents/kWh $2012)
Ene
rgy
Gen
Cap
T&D
Cap
Grid
Sup
por
tE
nvR
enew
Sol
arC
ost
Net
Tota
lB
enefi
tsTo
tal
6.67
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 45
of 5
9
46
E3
FOR
CA
LIFO
RN
IAP
UB
LIC
UTI
LITI
ES
CO
MM
ISS
ION
,201
1C
ALI
FOR
NIA
SO
LAR
INIT
IATI
VE
CO
ST-
EFF
EC
TIV
EN
ES
SE
VALU
ATIO
N
Sys
tem
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
“To
per
form
a c
ost-
effe
ctiv
enes
s ev
alua
tion
of t
he C
alifo
rnia
Sol
ar In
itiat
ive
(CS
I) in
acc
ord
ance
with
the
CS
I Pro
gram
Eva
luat
ion
Pla
n.”
GE
OG
RA
PH
IC F
OC
US
Cal
iforn
ia
SY
ST
EM
CO
NT
EX
TS
tud
y: C
SI p
rogr
am, r
etai
l net
met
erin
gC
A: 3
3% R
PS
, IS
O m
arke
t
LEV
EL
OF
SO
LAR
AN
ALY
ZE
D1,
940
MW
pro
gram
goa
l (<
1% o
f 201
6 p
eak
load
)
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
EP
artic
ipan
ts (D
PV
cus
tom
ers)
, Rat
epay
ers,
Pro
gram
Ad
min
istr
ator
, Tot
al
Res
ourc
e, S
ocie
ty
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISH
ourly
TO
OLS
/AP
PR
OA
CH
US
ED
•E
3 av
oid
ed c
ost
mod
el (2
011)
Hig
hlig
hts
•Th
e st
udy
conc
lud
es t
hat
DP
V is
not
exp
ecte
d t
o b
e co
st-e
ffect
ive
from
a t
otal
res
ourc
e or
rat
e im
pac
t p
ersp
ectiv
e d
urin
g th
e st
udy
per
iod
, but
tha
t p
artic
ipan
t ec
onom
ics
will
not
hin
der
CS
I ad
optio
n go
als.
Pro
gram
ince
ntiv
es s
upp
ort
par
ticip
ant
econ
omic
s in
the
sho
rt-r
un, b
ut D
PV
is
exp
ecte
d t
o b
e co
st-e
ffect
ive
for
man
y re
sid
entia
l cus
tom
ers
with
out
pro
gram
ince
ntiv
es b
y 20
17.
The
stud
y su
gges
ts t
hat
the
valu
e of
non
-eco
nom
ic b
enefi
ts o
f DP
V s
houl
d b
e ex
plo
red
to
det
erm
ine
if an
d h
ow t
hey
pro
vid
e va
lue
to C
alifo
rnia
.
•Th
e st
udy
focu
ses
seve
n b
enefi
ts in
clud
ing
ener
gy, l
ine
loss
es, g
ener
atio
n ca
pac
ity, T
&D
cap
acity
, em
issi
ons,
anc
illar
y se
rvic
es, a
nd a
void
ed R
PS
pur
chas
es. I
t fo
cuse
s on
cos
ts in
clud
ing
net
ener
gy m
eter
ing
bill
cre
dits
, reb
ates
/ince
ntiv
es, u
tility
inte
rcon
nect
ion,
cos
ts o
f the
DG
sys
tem
, net
m
eter
ing
cost
s, a
nd p
rogr
am a
dm
inis
trat
ion.
•Th
e st
udy
asse
sses
hou
rly a
void
ed c
osts
in e
ach
of C
alifo
rnia
’s 1
6 cl
imat
e zo
nes
to r
eflec
t va
ryin
g co
sts
in t
hose
zon
es, a
nd c
alcu
late
s b
enefi
ts a
nd c
osts
as
20-y
ear
leve
lized
val
ues.
It u
ses
E3’
s av
oid
ed c
ost
mod
el.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
This
stu
dy
asse
sses
ove
rall
cost
-effe
ctiv
enes
s b
ased
on
five
cost
tes
ts (p
artic
ipan
t co
st t
est,
rat
epay
er im
pac
t m
easu
re, p
rogr
am a
dm
inis
trat
or c
ost,
tot
al r
esou
rce
cost
, and
soc
ieta
l cos
t) as
defi
ned
in t
he C
alifo
rnia
Sta
ndar
d P
ract
ices
Man
ual,
and
p
rese
nts
tota
l rat
her
than
item
ized
res
ults
. The
refo
re, i
ndiv
idua
l res
ults
are
not
sh
own
here
in a
cha
rt.
Ene
rgy
= H
ourly
who
lesa
le v
alue
of e
nerg
y m
easu
red
at
the
poi
nt o
f who
lesa
le
ener
gy t
rans
actio
n. N
atur
al g
as p
rice
is b
ased
on
NY
ME
X fo
rwar
d m
arke
t an
d t
hen
on a
long
-run
fore
cast
of n
atur
al g
as p
rices
.
Loss
es =
Los
ses
bet
wee
n th
e d
eliv
ery
loca
tion
and
the
poi
nt o
f who
lesa
le e
nerg
y tr
ansa
ctio
n. L
osse
s sc
ale
with
ene
rgy
valu
e, a
nd r
eflec
t ch
angi
ng lo
sses
at
pea
k p
erio
ds.
Gen
erat
ion
cap
acit
y =
Val
ue o
f avo
idin
g ne
w g
ener
atio
n ca
pac
ity (a
ssum
ed t
o b
e a
gas
com
bus
tion
turb
ine)
to
mee
t sy
stem
pea
k lo
ads,
incl
udin
g ad
diti
onal
ca
pac
ity a
void
ed d
ue t
o d
ecre
ase
ener
gy lo
sses
. DP
V r
ecei
ves
the
full
valu
e of
av
oid
ed c
apac
ity a
fter
the
res
ourc
e b
alan
ce y
ear.
Valu
e is
less
in t
he s
hort
-run
(b
efor
e th
e re
sour
ce b
alan
ce y
ear)
bec
ause
of C
AIS
O’s
sub
stan
tial p
lann
ing
rese
rve
mar
gin.
T&
D c
apac
ity
= V
alue
of d
efer
ring
T&D
cap
acity
to
mee
t p
eak
load
s.
Gri
d s
upp
ort
ser
vice
s (a
ncill
ary
serv
ices
) = V
alue
bas
ed o
n hi
stor
ical
anc
illar
y se
rvic
es m
arke
t p
rices
, sca
led
with
the
pric
e of
nat
ural
gas
. Ind
ivid
ual a
ncill
ary
serv
ices
incl
uded
are
reg
ulat
ion
up, r
egul
atio
n d
own,
sp
inni
ng r
eser
ves,
and
non
-sp
inni
ng r
eser
ves,
and
val
ue is
bas
ed o
n ho
w a
load
red
uctio
n af
fect
s th
e p
rocu
rem
ent
of e
ach
AS
.
Avo
ided
RP
S =
Val
ue is
the
incr
emen
tal a
void
ed c
ost
of p
urch
asin
g re
new
able
re
sour
ces
to m
eet
Cal
iforn
ia’s
RP
S.
Env
iro
nmen
tal =
Val
ue o
f CO
2 re
duc
tion,
with
$/t
on p
rice
bas
ed o
n a
met
a-an
alys
is o
f for
ecas
ts. U
npric
ed e
xter
nalit
ies
(prim
arily
hea
lth e
ffect
s) w
ere
valu
ed a
t $0
.01-
0.03
/kW
h b
ased
on
seco
ndar
y so
urce
s.
So
cial
= T
he s
tud
y ac
know
led
ges
that
cus
tom
ers
who
inst
all D
PV
may
als
o in
stal
l m
ore
ener
gy e
ffici
ency
, but
doe
s no
t at
tem
pt
to q
uant
ify t
hat
valu
e. T
he s
tud
y al
so
ackn
owle
dge
s p
oten
tial b
enefi
ts a
ssoc
iate
d w
ith e
mp
loym
ent
and
tax
rev
enue
s an
d s
ugge
sts
that
an
inp
ut-o
utp
ut m
odel
wou
ld b
e an
ap
pro
pria
te a
pp
roac
h,
alth
ough
the
se b
enefi
ts a
re n
ot q
uant
ified
in t
his
stud
y.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 46
of 5
9
Hig
hlig
hts
•Lo
cal D
PV
is d
efine
d a
s P
V s
ized
suc
h th
at it
s ou
tput
will
be
cons
umed
by
load
on
the
feed
er o
r su
bst
atio
n w
here
it is
inte
rcon
nect
ed. S
pec
ifica
lly, t
he g
ener
atio
n ca
nnot
bac
kflow
from
the
dis
trib
utio
n sy
stem
ont
o th
e tr
ansm
issi
on s
yste
m.
•Th
e p
roce
ss fo
r id
entif
ying
site
s in
clud
ed u
sing
GIS
dat
a to
iden
tify
site
s su
rrou
ndin
g ea
ch o
f ap
pro
xim
atel
y 1,
800
sub
stat
ions
in P
G&
E, S
DG
&E
and
SC
E. T
he s
tud
y co
mp
ared
hou
rly lo
ad t
hat
the
ind
ivid
ual s
ubst
atio
n le
vel t
o p
oten
tial P
V g
ener
atio
n at
the
sam
e lo
catio
n.
•C
ost
of lo
cal d
istr
ibut
ed P
V in
crea
ses
sign
ifica
ntly
with
Inve
stm
ent
Tax
Cre
dit
(ITC
) exp
iratio
n in
201
7.
•W
hen
PV
is p
rocu
red
on
a le
ast
net
cost
bas
is, o
pp
ortu
nitie
s m
ay e
xist
to
loca
te in
are
as w
ith h
igh
avoi
ded
cos
ts. I
n 20
12, a
leas
t ne
t co
st p
rocu
rem
ent
app
roac
h re
sults
in n
et c
osts
tha
t ar
e ap
pro
xim
atel
y $6
5 m
illio
n lo
wer
ass
umin
g av
oid
ed t
rans
mis
sion
and
dis
trib
utio
n co
sts
can
be
real
ized
. Th
ese
ben
efits
car
ry t
hrou
gh t
o 20
16 fo
r th
e m
ost
par
t, b
ut d
isap
pea
r b
y 20
20, w
hen
all p
oten
tial h
as
bee
n re
aliz
ed r
egar
dle
ss o
f cos
t.
47
Ben
efits
Tota
l
EN
ER
GY
AN
D E
NV
IRO
NM
EN
TAL
EC
ON
OM
ICS,I
NC
.(E
3),2
012
TEC
HN
ICA
LP
OTE
NTI
AL
FOR
LO
CA
LD
ISTR
IBU
TED
PH
OTO
VO
LTA
ICS
IN C
ALI
FOR
NIA
ST
UD
YC
HA
RA
CT
ER
IST
ICS
ST
UD
YO
BJE
CT
IVE
To e
stim
ate
the
tech
nica
l pot
entia
l of l
ocal
DP
V in
Cal
iforn
ia, a
nd
the
asso
ciat
ed c
osts
and
ben
efits
.
GE
OG
RA
PH
ICF
OC
US
Cal
iforn
ia
SY
ST
EM
CO
NT
EX
TC
alifo
rnia
’s 3
inve
stor
-ow
ned
util
ities
(IO
U):
PG
&E
, SD
G&
E, S
CE
SO
LAR
PE
NE
TR
ATIO
N L
EV
EL
AN
ALY
ZE
D15
% o
f sys
tem
pea
k lo
ad
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
Tota
l res
ourc
e co
st (T
RC
)
GR
AN
ULA
RIT
Y O
F A
NA
LYS
IS1,
800
sub
stat
ions
TO
OLS
US
ED
E3
Avo
ided
Cos
t C
alcu
lato
r
Ene
rgy
savi
ngs
(Gen
erat
ion
Ene
rgy)
= E
stim
ate
of h
ourly
who
lesa
le
valu
e of
ene
rgy
adju
sted
for
loss
es b
etw
een
the
poi
nt o
f who
lesa
le
tran
sact
ion
and
del
iver
y. A
nnua
l for
ecas
t b
ased
on
mar
ket
forw
ard
s th
at
tran
sitio
n to
ann
ual a
vera
ge m
arke
t p
rice
need
ed t
o co
ver
the
fixed
and
op
erat
ing
cost
s of
a n
ew C
CG
T, le
ss n
et r
even
ue fr
om d
ay-a
head
en
ergy
, anc
illar
y se
rvic
e, a
nd c
apac
ity m
arke
ts. H
ourly
fore
cast
der
ived
b
ased
on
hist
oric
al h
ourly
day
-ahe
ad m
arke
t p
rice
shap
es a
re fr
om
CA
ISO
’s M
RTU
sys
tem
.
Loss
es (L
ine
Loss
es) =
The
loss
in e
nerg
y fr
om t
rans
mis
sion
and
d
istr
ibut
ion
acro
ss d
ista
nce.
Gen
erat
ion
cap
acit
y =
In t
he lo
ng-r
un (a
fter
the
res
ourc
e b
alan
ce
year
), ge
nera
tion
cap
acity
val
ue is
bas
ed o
n th
e fix
ed c
ost
of a
new
CT
less
exp
ecte
d r
even
ues
from
rea
l-tim
e en
ergy
and
anc
illar
y se
rvic
es
mar
kets
. Prio
r to
res
ourc
e b
alan
ce, v
alue
is b
ased
on
a re
sour
ce
adeq
uacy
val
ue.
T&
D c
apac
ity
= V
alue
is b
ased
on
the
“pre
sent
wor
th”
app
roac
h to
ca
lcul
ate
def
erm
ent
valu
e, in
corp
orat
ing
inve
stm
ent
pla
ns a
s re
por
ted
b
y ut
ilitie
s.
Gri
d s
upp
ort
ser
vice
s =
Val
ue b
ased
on
the
valu
e of
avo
ided
res
erve
s,
scal
ing
with
ene
rgy.
Env
iro
nmen
tal b
enefi
ts =
Val
ue o
f CO
2 em
issi
ons,
bas
ed o
n an
es
timat
e of
the
mar
gina
l res
ourc
e an
d a
met
a-an
alys
is o
f for
ecas
ted
ca
rbon
pric
es.
*E3’
s co
mp
onen
ts o
f ele
ctric
ity a
void
ed c
osts
incl
ude
gene
ratio
n en
ergy
, lin
e lo
sses
, sys
tem
cap
acity
, anc
illar
y se
rvic
es, T
&D
cap
acity
, env
ironm
ent.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
-50.
0
-37.
5
-25.
0
-12.
50
12.5
25.0
(cents/kWh $2012)
Ene
rgy
Gen
Cap
T&D
Cap
Tota
lD
G
Tech
Loss
esA
SA
SC
ost
Car
bon
-14.
52
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 47
of 5
9
48
CR
OS
SB
OR
DE
RE
NE
RG
Y F
OR
VO
TES
OLA
RIN
ITIA
TIV
E,2
013
EVA
LUAT
ING
TH
E B
EN
EFI
TS A
ND
CO
STS
OF
NE
TE
NE
RG
YM
ETE
RIN
G IN
CA
LIFO
RN
IA
Sys
tem
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
“To
exp
lore
rec
ent
clai
ms
from
Cal
iforn
ia's
inve
stor
-ow
ner
utili
ties
that
the
st
ate'
s N
EM
pol
icy
caus
es s
ubst
antia
l cos
t sh
ifts
bet
wee
n en
ergy
cu
stom
ers
with
Sol
ar P
V s
yste
ms
and
non
-sol
ar c
usto
mer
s, p
artic
ular
ly in
re
sid
entia
l mar
ket.
”
GE
OG
RA
PH
IC F
OC
US
Cal
iforn
ia
SY
ST
EM
CO
NT
EX
T33
% R
PS
, ret
ail n
et m
eter
ing,
incr
easi
ng s
olar
pen
etra
tion,
ISO
mar
ket
LEV
EL
OF
SO
LAR
AN
ALY
ZE
DU
p t
o 5%
of p
eak
(by
cap
acity
)
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
EO
ther
cus
tom
ers
(rat
epay
ers)
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISH
ourly
, by
clim
ate
zone
TO
OLS
US
ED
•E
3 av
oid
ed c
ost
mod
el (2
011)
, PV
Wat
ts
Hig
hlig
hts
•Th
e st
udy
conc
lud
es t
hat
“on
aver
age
over
the
res
iden
tial m
arke
ts o
f the
sta
te’s
thr
ee b
ig IO
Us,
N
EM
doe
s no
t im
pos
e co
sts
on n
on-p
artic
ipat
ing
rate
pay
ers,
and
inst
ead
cre
ates
a s
mal
l net
b
enefi
t.”
This
con
clus
ion
is d
riven
by
“rec
ent
sign
ifica
nt c
hang
es t
hat
the
CP
UC
has
ad
opte
d in
IO
Us’
res
iden
tial r
ate
des
igns
” p
lus
“rec
ogni
tion
that
[DP
V]..
.avo
id o
ther
pur
chas
es o
r re
new
able
p
ower
, res
ultin
g in
a s
igni
fican
t im
pro
vem
ent
in t
he e
cono
mic
s of
NE
M c
omp
ared
to
the
CP
UC
’s
2009
E3
NE
M S
tud
y.”
•Th
e st
udy
focu
sed
on
seve
n b
enefi
ts: a
void
ed e
nerg
y, a
void
ed g
ener
atio
n ca
pac
ity, r
educ
ed c
ost
for
anci
llary
ser
vice
s, lo
wer
line
loss
es, r
educ
ed T
&D
inve
stm
ents
, low
er c
osts
for
the
utili
ty’s
p
urch
ase
of o
ther
ren
ewab
le g
ener
atio
n, a
nd a
void
ed e
mis
sion
s. T
he s
tud
y’s
anal
ysis
refl
ects
co
sts
to o
ther
cus
tom
ers
(rat
epay
ers)
from
“b
ill c
red
its t
hat
the
utili
ty p
rovi
des
to
sola
r cu
stom
ers
as c
omp
ensa
tion
for
NE
M e
xpor
ts, p
lus
any
incr
emen
tal u
tility
cos
ts t
o m
eter
and
bill
NE
M
cust
omer
s.”
Thes
e co
sts
are
not
qua
ntifi
ed a
nd le
veliz
ed in
div
idua
lly in
the
rep
ort,
so
they
are
not
re
flect
ed in
the
cha
rt t
o th
e rig
ht.
•Th
e st
udy
bas
es it
s D
PV
val
ue a
sses
smen
t on
E3’
s av
oid
ed c
ost
mod
el a
nd a
pp
roac
h. It
up
dat
es
key
assu
mp
tions
incl
udin
g na
tura
l gas
pric
e fo
reca
st, g
reen
hous
e ga
s al
low
ance
pric
es, a
nd
anci
llary
ser
vice
s re
venu
es, a
nd e
xclu
des
the
res
ourc
e b
alan
ce y
ear
app
roac
h (th
e ye
ar in
whi
ch
avoi
ded
cos
ts c
hang
e fr
om s
hort
-run
to
long
-run
). Th
e st
udy
view
s th
e re
sour
ce b
alan
ce y
ear
as
inco
nsis
tent
with
the
mod
ular
, sho
rt le
ad-t
ime
natu
re o
f DP
V.
•Th
e st
udy
only
con
sid
ered
the
val
ue o
f the
exp
orts
to
the
grid
und
er t
he u
tility
’s n
et m
eter
ing
pro
gram
.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
Ene
rgy
= W
hole
sale
val
ue o
f ene
rgy
adju
sted
for
loss
es b
etw
een
the
poi
nt o
f the
w
hole
sale
tra
nsac
tion
and
the
poi
nt o
f del
iver
y. C
ross
bor
der
ad
just
ed n
atur
al g
as
pric
e fo
reca
st a
nd g
reen
hous
e ga
s p
rice
fore
cast
.
Loss
es =
The
loss
in e
nerg
y fr
om t
rans
mis
sion
and
dis
trib
utio
n ac
ross
dis
tanc
e.
Gri
d s
upp
ort
ser
vice
s (a
ncill
ary
serv
ices
) = T
he m
argi
nal c
ost
of p
rovi
din
g sy
stem
op
erat
ions
and
res
erve
s fo
r el
ectr
icity
grid
rel
iab
ility
. Cro
ssb
ord
er u
pd
ated
as
sum
ed a
ncill
ary
serv
ices
rev
enue
s.
Env
iro
nmen
t =
The
cos
t of
car
bon
dio
xid
e em
issi
ons
asso
ciat
ed w
ith t
he m
argi
nal
gene
ratin
g re
sour
ce.
Gen
erat
ion
cap
acit
y =
The
cos
t of
bui
ldin
g ne
w g
ener
atio
n ca
pac
ity t
o m
eet
syst
em p
eak
load
s. C
ross
bor
der
doe
s no
t us
e E
3’s
“res
ourc
e b
alan
ce y
ear”
ap
pro
ach,
whi
ch m
eans
tha
t ge
nera
tion
cap
acity
val
ue is
bas
ed o
n lo
ng-r
un
avoi
ded
cap
acity
cos
ts.
T&
D c
apac
ity
= T
he c
osts
of e
xpan
din
g tr
ansm
issi
on a
nd d
istr
ibut
ion
cap
acity
to
mee
t p
eak
load
s.
Avo
ided
RP
S =
The
avo
ided
net
cos
t of
pro
curin
g re
new
able
res
ourc
es t
o m
eet
an
RP
S P
ortf
olio
tha
t is
a p
erce
ntag
e of
tot
al r
etai
l sal
es d
ue t
o a
red
uctio
n in
ret
ail
load
s.0510152025
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
(cents/kWh $2012)
Ene
rgy
Loss
esG
enC
apTo
tal
21.8
1
Avo
ided
RP
SE
nvG
ridS
upp
ort
T&D
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 48
of 5
9
Hig
hlig
hts
•Th
e va
lue
of o
n-p
eak
sola
r en
ergy
in 2
005
rang
ed fr
om $
0.23
- 0
.35
/kW
h.
•Th
e an
alys
is lo
oks
at a
void
ed c
osts
und
er t
wo
alte
rnat
ive
scen
ario
s fo
r th
e ye
ar 2
005.
The
tw
o sc
enar
ios
vary
the
cos
t of
dev
elop
ing
new
pow
er p
lant
s an
d t
he p
rice
of n
atur
al g
as.
•S
cena
rio 1
ass
umed
new
pea
king
gen
erat
ion
will
be
bui
lt b
y th
e el
ectr
ic u
tility
at
a co
st o
f cap
ital o
f 9.5
%
with
cos
t re
cove
ry o
ver
a 20
yea
r p
erio
d; t
he p
rice
of n
atur
al g
as is
bas
ed o
n th
e 20
05 s
umm
er m
arke
t p
rice
(ave
rage
gas
pric
e)
•S
cena
rio 2
ass
umed
new
pea
king
gen
erat
ion
will
be
bui
lt b
y a
mer
chan
t p
ower
pla
nt d
evel
oper
at
a co
st
of c
apita
l of 1
5% w
ith c
ost
reco
very
ove
r a
10 y
ear
per
iod
; the
pric
e of
nat
ural
gas
is b
ased
on
the
aver
age
gas
pric
e in
Cal
iforn
ia fo
r th
e p
erio
d o
f May
200
0 th
roug
h Ju
ne 2
001
(hig
h ga
s p
rice
– 24
%
high
er)
•W
hile
num
erou
s un
qua
ntifi
able
ben
efits
wer
e no
ted
, five
ben
efits
wer
e q
uant
ified
: •
1. d
efer
ral o
f inv
estm
ents
in n
ew p
eaki
ng p
ower
cap
acity
•
2. a
void
ed p
urch
ase
of n
atur
al g
as u
sed
to
pro
duc
e el
ectr
icity
•
3. a
void
ed e
mis
sion
s of
CO
2 an
d N
Ox
that
imp
act
glob
al c
limat
e an
d lo
cal a
ir q
ualit
y •
4. r
educ
tion
in t
rans
mis
sion
and
dis
trib
utio
n sy
stem
pow
er lo
sses
•
5. d
efer
ral o
f tra
nsm
issi
on a
nd d
istr
ibut
ion
inve
stm
ents
tha
t w
ould
be
need
ed t
o m
eet
grow
ing
load
s.
•Th
e st
udy
assu
med
tha
t, “
in C
alifo
rnia
, nat
ural
gas
is t
he fu
el u
sed
by
pow
er p
lant
s on
the
mar
gin
bot
h fo
r p
eak
dem
and
per
iod
s an
d n
on-p
eak
per
iod
s. T
here
fore
it is
rea
sona
ble
to
assu
me
the
sola
r el
ectr
ic
faci
litie
s w
ill d
isp
lace
the
bur
ning
of n
atur
al g
as in
all
hour
s th
at t
hey
pro
duc
e el
ectr
icity
.”49
0
12.5
25.0
37.5
50.0
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
(cents/kWh $2012)
Ene
rgy
Loss
esG
enC
apTo
tal
T&D
Cap
Env
iro
ST
UD
YC
HA
RA
CT
ER
IST
ICS
ST
UD
YO
BJE
CT
IVE
To p
rovi
de
a q
uant
itativ
e an
alys
is o
f key
ben
efits
of s
olar
ene
rgy
for
Cal
iforn
ia.
GE
OG
RA
PH
ICF
OC
US
Cal
iforn
ia
SY
ST
EM
CO
NT
EX
TC
alifo
rnia
’s 3
inve
stor
-ow
ned
util
ities
(IO
U):
PG
&E
, SD
G&
E, S
CE
SO
LAR
PE
NE
TR
ATIO
N L
EV
EL
AN
ALY
ZE
DU
nsp
ecifi
ed
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
Util
ity, r
atep
ayer
, par
ticip
ant,
soc
iety
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISA
vera
ge E
LCC
ass
umed
to
be
50%
from
ran
ge o
f 36%
-70%
d
eriv
ed fr
om N
RE
L st
udy1
TO
OLS
US
ED
Sp
read
shee
t an
alys
is
VO
TES
OLA
RIN
ITIA
TIV
E,2
005
QU
AN
TIFY
ING
THE
BE
NE
FITS
OF
SO
LAR
PO
WE
RFO
RC
ALI
FOR
NIA
Ene
rgy
(Avo
ided
Fue
l and
Var
iab
le O
&M
) = N
atur
al g
as fu
el p
rice
mul
tiplie
d b
y as
sum
ed h
eat
rate
of p
eaki
ng p
ower
pla
nt (9
360
MM
BTU
/kW
h). A
ssum
ed v
alue
of c
onsu
mab
les
such
as
wat
er a
nd a
mm
onia
to
be
app
roxi
mat
ely
0.5
cent
s/kW
h. F
or n
on-p
eak,
ave
rage
hea
t ra
tes
of
exis
ting
fleet
of n
atur
al g
as p
lant
s w
ere
used
for
each
ele
ctric
util
ity's
se
rvic
e ar
ea. T
hose
hea
t ra
tes
are
as fo
llow
s: P
G&
E: 8
740
MM
BTU
/kW
h, S
CE
- 9
690
MM
BTU
/kW
h, S
DG
&E
– 9
720
MM
BTU
/kW
h.
Loss
es (L
ine
Loss
es) =
Sol
ar a
ssum
ed t
o b
e d
eliv
ered
at
seco
ndar
y vo
ltage
. The
sum
mer
pea
k an
d t
he s
umm
er s
houl
der
loss
fact
ors
are
used
to
calc
ulat
e th
e ad
diti
onal
ben
efit
der
ived
from
sol
ar p
ower
sy
stem
s b
ecau
se o
f the
ir lo
catio
n at
load
.
Gen
erat
ion
cap
acit
y =
Cos
t of
inst
allin
g a
sim
ple
cyc
le g
as t
urb
ine
pea
king
pla
nt m
ultip
lied
by
DP
V’s
ELC
C a
nd a
cap
ital r
ecov
ery
fact
or,
conv
erte
d in
to c
osts
per
kilo
wat
t ho
ur b
y ex
pec
ted
hou
rs o
f on-
pea
k op
erat
ion.
T&
D c
apac
ity
= O
ne s
tud
y ar
ea w
as s
elec
ted
for
each
util
ity t
o ca
lcul
ate
the
valu
e of
sol
ar e
lect
ricity
in a
void
ing
T&D
up
grad
es. t
o si
mp
lify
the
anal
ysis
the
nee
d fo
r T&
D u
pgr
ades
was
ass
umed
to
be
driv
en b
y gr
owth
in d
eman
d d
urin
g 5%
of t
he h
ours
in a
yea
r. Th
e 50
%
ELC
C w
as u
sed
use
d in
cal
cula
ting
the
valu
e of
avo
ided
T&
D u
pgr
ades
.
Env
iro
nmen
tal b
enefi
ts =
Ass
umed
to
be
the
avoi
ded
air
emis
sion
s,
carb
on d
ioxi
de
and
NO
x, c
reat
ed fr
om m
argi
nal g
ener
ator
(nat
ural
gas
). C
O2
= $
100/
ton;
NO
x =
$.0
14/k
Wh
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
33.9
3
1 "S
olar
Res
ourc
e-U
tility
Loa
d-M
atch
ing
Ass
essm
ent,
" R
icha
rd P
erez
, Nat
iona
l Ren
ewab
le E
nerg
y La
bor
ator
y, 1
994
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3P
age
49 o
f 59
50
RIC
HA
RD
DU
KE,E
NE
RG
YP
OLI
CY,2
005
AC
CE
LER
ATIN
G R
ES
IDE
NTI
AL
PV
EX
PAN
SIO
N: D
EM
AN
D A
NA
LYS
IS F
OR
CO
MP
ETI
TIV
E E
LEC
TRIC
ITY
MA
RK
ETS
Stu
dy
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To q
uant
ify t
he p
oten
tial m
arke
t fo
r gr
id-c
onne
cted
, res
iden
tial P
V
elec
tric
ity in
tegr
ated
into
new
hou
ses
bui
lt in
the
US
.
GE
OG
RA
PH
IC F
OC
US
Cal
iforn
ia a
nd Il
linoi
s
SY
ST
EM
CO
NT
EX
TC
alifo
rnia
: 33%
RP
S, m
ostly
gas
gen
erat
ion;
Illin
ois:
mos
tly c
oal
gene
ratio
n
LEV
EL
OF
SO
LAR
AN
ALY
ZE
Dno
t st
ated
; ass
umed
low
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
yste
m
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISH
igh
leve
l, la
rgel
y b
ased
on
seco
ndar
y an
alys
is
TO
OLS
US
ED
•n/
a
Hig
hlig
hts
•To
tal v
alue
var
ies
sign
ifica
ntly
bet
wee
n th
e tw
o re
gion
s st
udie
d la
rgel
y d
riven
by
wha
t th
e of
f-p
eak
mar
gina
l res
ourc
e is
(gas
vs
coal
). C
oal h
as s
igni
fican
tly h
ighe
r ai
r p
ollu
tion
cost
s, a
lthou
gh lo
wer
fu
el c
osts
.
•Th
e st
udy
note
s th
at t
rue
valu
e va
ries
dra
mat
ical
ly w
ith lo
cal c
ond
ition
s, s
o p
reci
se c
alcu
latio
ns a
t a
high
-lev
el a
naly
sis
leve
l are
imp
ossi
ble
. As
such
, tra
nsm
issi
on a
nd d
istr
ibut
ion
imp
acts
wer
e ac
know
led
ged
but
not
incl
uded
.
Ene
rgy
= E
nerg
y va
lue
is b
ased
on
the
mar
gina
l res
ourc
e on
-pea
k (g
as
com
bus
tion
turb
ine)
and
off-
pea
k (in
effic
ient
gas
in C
alifo
rnia
, and
coa
l in
Illin
ois)
. Fu
el p
rices
are
bas
ed o
n E
nerg
y In
form
atio
n A
dm
inis
trat
ion
pro
ject
ions
, and
le
veliz
ed.
Loss
es =
Ene
rgy
loss
es a
re a
ssum
ed t
o b
e 7-
8% o
ff-p
eak,
and
up
to
twic
e th
at
on-p
eak.
Los
ses
are
only
incl
uded
as
ener
gy lo
sses
.
Gen
erat
ion
cap
acit
y =
Gen
erat
ion
cap
acity
val
ue is
bas
ed o
n th
e as
sum
ptio
n th
at
the
mar
gina
l res
ourc
e is
alw
ays
a ga
s co
mb
ustio
n tu
rbin
e. D
epen
dab
le c
apac
ity is
b
ased
on
an E
LCC
est
imat
e fr
om s
econ
dar
y so
urce
s.
Fina
ncia
l (Fu
el p
rice
hed
ge)
= H
edge
val
ue is
est
imat
ed b
ased
on
the
mar
ket
valu
e to
util
ities
of a
fixe
d n
atur
al g
as p
rice
for
up t
o 10
yea
rs b
ased
on
mar
ket
swap
dat
a. T
he h
edge
is a
ssum
ed t
o b
e ad
diti
ve s
ince
EIA
gas
pric
es w
ere
used
ra
ther
tha
n N
YM
EX
futu
res
mar
ket.
Env
iro
nmen
t (c
rite
ria
air
po
lluta
nts,
car
bo
n) =
Crit
eria
air
pol
luta
nt r
educ
tion
valu
e is
bas
ed o
n av
oid
ed c
osts
of h
ealth
imp
acts
, est
imat
ed b
y se
cond
ary
sour
ces.
Car
bon
val
ue is
the
pric
e of
car
bon
(est
imat
ed b
ased
on
Eur
opea
n m
arke
t p
roje
ctio
ns) t
imes
the
am
ount
of c
arb
on d
isp
lace
d.
*Cha
rt d
ata
only
refl
ects
Cal
iforn
ia a
sses
smen
t fo
r co
mp
aris
on
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
05101520
(cents/kWh $2012)
Ene
rgy
Loss
esG
enC
apTo
tal
Fuel
Hed
geP
ollu
tant
sC
arb
on
16.9
6
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 50
of 5
9
51
LAW
RE
NC
E B
ER
KE
LEY
NAT
ION
AL
LAB,2
012
CH
AN
GE
S IN
TH
E E
CO
NO
MIC
VA
LUE
OF
VA
RIA
BLE
GE
NE
RAT
ION
AT
HIG
HP
EN
ETR
ATIO
N L
EV
ELS
:AP
ILO
TC
AS
ES
TUD
Y O
F C
ALI
FOR
NIA
Stu
dy
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To q
uant
ify t
he c
hang
e in
val
ue fo
r a
sub
set
of e
cono
mic
ben
efits
(ene
rgy,
ca
pac
ity, a
ncill
ary
serv
ices
, DA
fore
cast
ing
erro
r) t
hat
resu
lts fr
om u
sing
re
new
able
gen
erat
ion
tech
nolo
gies
(win
d, P
V, C
SP,
& T
herm
al E
nerg
y S
tora
ge) a
t d
iffer
ent
pen
etra
tion
leve
ls.
GE
OG
RA
PH
IC F
OC
US
Loos
ely
bas
ed o
n C
alifo
rnia
SY
ST
EM
CO
NT
EX
T33
% R
PS
, IS
O m
arke
t
LEV
EL
OF
SO
LAR
AN
ALY
ZE
DU
p t
o 40
% (b
y en
ergy
)
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
yste
m
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISLo
ng-r
un in
vest
men
t d
ecis
ions
and
sho
rt-t
erm
dis
pat
ch a
nd o
per
atio
ns
TO
OLS
US
ED
•C
usto
miz
ed m
odel
Hig
hlig
hts
•Th
e m
argi
nal e
cono
mic
val
ue o
f sol
ar e
xcee
ds
the
valu
e of
flat
blo
ck p
ower
at
low
pen
etra
tion
leve
ls, l
arge
ly a
ttrib
utab
le t
o ge
nera
tion
cap
acity
val
ue a
nd s
olar
coi
ncid
ence
with
pea
k.
•Th
e m
argi
nal v
alue
of D
PV
dro
ps
cons
ider
ably
as
the
pen
etra
tion
of s
olar
incr
ease
s, in
itial
ly, d
riven
b
y a
dec
reas
e in
cap
acity
val
ue w
ith in
crea
sing
sol
ar g
ener
atio
n. A
t th
e hi
ghes
t re
new
able
p
enet
ratio
ns c
onsi
der
ed, t
here
is a
lso
a d
ecre
ase
in e
nerg
y va
lue
as P
V d
isp
lace
s lo
wer
cos
t re
sour
ces.
•Th
e st
udy
note
s th
at it
is c
ritic
al t
o us
e an
ana
lysi
s fr
amew
ork
that
ad
dre
sses
long
-ter
m
inve
stm
ent
dec
isio
ns a
s w
ell a
s sh
ort-
term
dis
pat
ch a
nd o
per
atio
nal c
onst
rain
ts.
•S
ever
al c
osts
and
imp
acts
are
not
con
sid
ered
in t
he s
tud
y, in
clud
ing
envi
ronm
enta
l im
pac
ts,
tran
smis
sion
and
dis
trib
utio
n co
sts
or b
enefi
ts, e
ffect
s re
late
d t
o th
e lu
mp
ines
s an
d ir
reve
rsib
ility
of
inve
stm
ent
dec
isio
ns, u
ncer
tain
ty in
futu
re fu
el a
nd in
vest
men
t ca
pita
l cos
ts, a
nd D
PV
’s c
apita
l co
st.
Ene
rgy
= E
nerg
y va
lue
dec
reas
es a
t hi
gh p
enet
ratio
ns b
ecau
se t
he m
argi
nal
reso
urce
tha
t D
PV
dis
pla
ces
chan
ges
as t
he s
yste
m m
oves
dow
n th
e d
isp
atch
st
ack
to a
low
er c
ost
gene
rato
r. E
nerg
y va
lue
is b
ased
on
the
shor
t-ru
n p
rofit
ea
rned
in n
on-s
carc
ity h
ours
(tho
se h
ours
whe
re m
arke
t p
rices
are
und
er $
500/
MW
h), a
nd g
ener
ally
dis
pla
ces
ener
gy fr
om a
gas
com
bin
ed c
ycle
. Fue
l cos
ts a
re
bas
ed o
n E
nerg
y In
form
atio
n A
dm
inis
trat
ion
pro
ject
ions
.
Gen
erat
ion
cap
acit
y =
Gen
erat
ion
cap
acity
val
ue is
bas
ed o
n th
e p
ortio
n of
sho
rt-
run
pro
fit e
arne
d d
urin
g ho
urs
with
sca
rcity
pric
es (t
hose
hou
rs w
here
mar
ket
pric
e eq
uals
or
exce
eds
$500
/MW
h). D
epen
dab
le D
PV
cap
acity
is b
ased
on
an im
plie
d
cap
acity
cre
dit
as a
res
ult
of t
he m
odel
’s in
vest
men
t d
ecis
ions
, rat
her
than
a
det
aile
d r
elia
bili
ty o
r E
LCC
ana
lysi
s.
Gri
d S
upp
ort
(Anc
illar
y S
ervi
ces)
= A
ncill
ary
serv
ices
val
ue is
the
net
ear
ning
s fr
om s
ellin
g an
cilla
ry s
ervi
ces
in t
he m
arke
t as
wel
l as
pay
ing
for
incr
ease
d a
ncill
ary
se
rvic
es d
ue t
o in
crea
sed
sho
rt-t
erm
var
iab
ility
and
unc
erta
inty
.
-2.50
2.5
5.0
7.5
10.0
Ene
rgy
Gen
Cap
Grid
Sup
por
tTo
tal
(cents/kWh $2012)
5.91
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 51
of 5
9
52
ST
UD
YC
HA
RA
CT
ER
IST
ICS
ST
UD
YO
BJE
CT
IVE
To q
uant
ify t
he c
ost
and
val
ue c
omp
onen
ts p
rovi
ded
to
utili
ties,
rat
epay
ers,
and
tax
pay
ers
by
grid
-con
nect
ed,
dis
trib
uted
PV
in P
enns
ylva
nia
and
New
Jer
sey.
GE
OG
RA
PH
ICF
OC
US
7 ci
ties
acro
ss P
A a
nd N
J
SY
ST
EM
CO
NT
EX
TP
JM IS
O
SO
LAR
PE
NE
TR
ATIO
N L
EV
EL
AN
ALY
ZE
D
15%
of s
yste
m p
eak
load
, tot
alin
g 7
GW
acr
oss
the
7 ut
ility
hub
s
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
Util
ity, r
atep
ayer
s, t
axp
ayer
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISLo
catio
nal M
argi
nal P
rice
nod
e
TO
OLS
US
ED
Cle
an P
ower
Res
earc
h’s
Dis
trib
uted
PV
Val
ue C
alcu
lato
r;
Sol
ar A
nyw
here
, 201
2
Hig
hlig
hts
•Th
e st
udy
eval
uate
d 1
0 b
enefi
ts a
nd 1
cos
t. E
valu
ated
ben
efits
incl
uded
: Fue
l cos
t sa
ving
s,
O&
M c
ost
savi
ngs,
sec
urity
enh
ance
men
t, lo
ng t
erm
soc
ieta
l ben
efit,
fuel
pric
e he
dge
, ge
nera
tion
cap
acity
, T&
D c
apac
ity, m
arke
t p
rice
red
uctio
n, e
nviro
nmen
tal b
enefi
t, e
cono
mic
d
evel
opm
ent
ben
efit.
The
cos
t ev
alua
ted
was
the
sol
ar p
enet
ratio
n co
st.
•Th
e an
alys
is r
epre
sent
s th
e va
lue
of P
V fo
r a
“flee
t” o
f PV
sys
tem
s, e
valu
ated
in 4
orie
ntat
ions
, ea
ch a
t 7
loca
tions
(Pitt
sbur
gh, P
A; H
arris
bur
g, P
A; S
cran
ton,
PA
; Phi
lad
elp
hia,
PA
; Ja
mes
bur
g, N
J; N
ewar
k, N
J; a
nd A
tlant
ic C
ity, N
J), s
pan
ning
6 u
tility
ser
vice
ter
ritor
ies,
eac
h d
iffer
ing
by:
cos
t of
cap
ital,
hour
ly lo
ads,
T&
D lo
ss fa
ctor
s, d
istr
ibut
ion
exp
ansi
on c
osts
, and
gr
owth
rat
e.
•Th
e to
tal v
alue
ran
ged
from
$25
6 to
$31
8/M
Wh.
Of t
his,
the
hig
hest
val
ue c
omp
onen
ts w
ere
the
Mar
ket
Pric
e R
educ
tion
(avg
$55
/MW
h) a
nd t
he E
cono
mic
Dev
elop
men
t Va
lue
(avg
$44
/M
Wh)
.
•Th
e m
oder
ate
gene
ratio
n ca
pac
ity v
alue
is d
riven
by
a m
oder
ate
mat
ch b
etw
een
DP
V o
utp
ut
and
util
ity s
yste
m lo
ad. T
he e
ffect
ive
cap
acity
ran
ges
from
28%
to
45%
of r
ated
out
put
(in
line
with
the
ass
igne
d P
JM v
alue
of 3
8% fo
r so
lar
reso
urce
s).
•Lo
ss s
avin
gs w
ere
not
trea
ted
as
a st
and
-alo
ne b
enefi
t un
der
the
con
vent
ion
used
in t
his
met
hod
olog
y. R
athe
r, th
e ef
fect
of l
oss
savi
ngs
is in
clud
ed s
epar
atel
y fo
r ea
ch v
alue
co
mp
onen
t.
CLE
AN
PO
WE
RR
ES
EA
RC
H,2
012
THE
VA
LUE
OF
DIS
TRIB
UTE
DS
OLA
RE
LEC
TRIC
GE
NE
RAT
ION
TO
NE
WJE
RS
EY
AN
D P
EN
NS
YLV
AN
IA
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
-10010203040
(cents/kWh $2012)
Energy
GenCap
T&D Cap
Enviro.
Total
FuelHedge
SolarCost
Mkt Price Reduct
Security
Social
BenefitsTotal
24.9
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
Ene
rgy
savi
ngs
(Fue
l co
st s
avin
gs
+ O
&M
Co
st S
avin
gs)
= P
V o
utp
ut p
lus
loss
sav
ings
tim
es
mar
gina
l ene
rgy
cost
, sum
med
all
hrs
of t
he y
ear,
dis
coun
ted
ove
r P
V li
fe (3
0 ye
ars)
. Mar
gina
l ene
rgy
cost
sar
e b
ased
on
fuel
and
O&
M c
osts
of t
he g
ener
ator
mos
t lik
ely
oper
atin
g on
the
mar
gin
(ass
umed
to
be
a co
mb
ined
cyc
le g
as t
urb
ine)
. Ass
umed
nat
ural
gas
pric
e fo
reca
st: N
YM
EX
futu
res
year
s 0-
12;
NY
ME
X fu
ture
s p
rice
for
year
12
x 2.
33%
esc
alat
ion
fact
or. E
scal
atio
n ra
te a
ssum
ed t
o b
e ra
te o
f w
ellh
ead
pric
e es
cala
tion
from
198
1-20
11.
Gen
erat
ion
cap
acit
y =
Cap
ital c
ost
of d
isp
lace
gen
erat
ion
times
PV
's e
ffect
ive
load
car
ryin
g ca
pab
ility
(E
LCC
), ta
king
into
acc
ount
loss
sav
ings
.
T&
D c
apac
ity
= E
xpec
ted
long
-ter
m T
&D
sys
tem
cap
acity
up
grad
e co
st, d
ivid
ed b
y lo
ad g
row
th, t
imes
fin
anci
al t
erm
, tim
es a
fact
or t
hat
rep
rese
nts
mat
ch b
etw
een
PV
sys
tem
out
put
(ad
just
ed fo
r lo
sses
) and
T&
D s
yste
m lo
ad. I
n th
is s
tud
y, T
&D
val
ues
wer
e b
ased
on
utili
ty-w
ide
aver
age
load
s, w
hich
may
ob
scur
e hi
gher
val
ue a
reas
.
Fuel
pri
ce h
edg
e va
lue
= C
ost
to e
limin
ate
the
fuel
pric
e un
cert
aint
y as
soci
ated
with
nat
ural
gas
ge
nera
tion
thro
ugh
pro
cure
men
t of
com
mod
ity fu
ture
s. T
he v
alue
is d
irect
ly r
elat
ed t
o th
e ut
ility
's c
ost
of c
apita
l.
Mar
ket
Pri
ce R
educ
tio
n =
Val
ue t
o cu
stom
ers
of t
he r
educ
ed c
ost
of w
hole
sale
ene
rgy
as a
res
ult
of
PV
inst
alla
tion
dec
reas
ing
the
dem
and
for
who
lesa
le e
nerg
y. Q
uant
ified
thr
ough
an
anal
ysis
of t
he
sup
ply
cur
ve a
nd r
educ
tion
in d
eman
d, a
nd t
he a
ccom
pan
ying
new
mar
ket
clea
ring
pric
e.
Sec
urit
y (S
ecur
ity
Enh
ance
men
t Va
lue)
= A
nnua
l cos
t of
pow
er o
utag
es in
the
U.S
. tim
es t
he p
erce
nt
(5%
) tha
t ar
e hi
gh-d
eman
d s
tres
s ty
pe
that
can
be
effe
ctiv
ely
miti
gate
d b
y d
istr
ibut
ed P
V a
t a
cap
acity
p
enet
ratio
n of
15%
.
So
cial
(Eco
nom
ic D
evel
op
men
t Va
lue)
= V
alue
of t
ax r
even
ues
asso
ciat
ed w
ith n
et jo
b c
reat
ion
for
sola
r vs
con
vent
iona
l pow
er g
ener
atio
n. P
V h
ard
and
sof
t co
st /
kW t
imes
por
tion
of e
ach
attr
ibut
ed t
o lo
cal j
obs,
div
ided
by
annu
al P
V s
yste
m e
nerg
y p
rod
uced
, min
us C
CG
T co
st/k
W t
imes
por
tion
attr
ibut
ed t
o lo
cal j
obs
div
ided
by
annu
al e
nerg
y p
rod
uced
. Lev
eliz
ed o
ver
the
30 y
ear
lifet
ime
of P
V
syst
em, a
dju
sted
for
lost
util
ity jo
bs,
mul
tiplie
d b
y ta
x ra
te o
f a $
75K
sal
ary,
mul
tiplie
d b
y in
dire
ct jo
b
mul
tiplie
r.
Env
iro
nmen
tal b
enefi
ts =
Env
ironm
enta
l cos
t of
a d
isp
lace
d c
onve
ntio
nal g
ener
atio
n te
chno
logy
tim
es
the
por
tion
of t
his
tech
nolo
gy in
the
ene
rgy
gene
ratio
n m
ix, r
epea
ted
and
sum
med
for
each
co
nven
tiona
l gen
erat
ion
sour
ces
dis
pla
ced
by
PV.
Env
ironm
enta
l cos
t fo
r ea
ch g
ener
atio
n so
urce
bas
ed
on c
osts
of G
HG
, SO
x /
NO
x em
issi
ons,
min
ing
deg
rad
atio
ns, g
roun
d-w
ater
con
tam
inat
ion,
tox
ic
rele
ases
and
was
tes.
etc
...as
cal
cula
ted
in s
ever
al e
nviro
nmen
tal h
ealth
stu
die
s.
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3P
age
52 o
f 59
53
CLE
AN
PO
WE
RR
ES
EA
RC
H&
SO
LAR
SA
NA
NTO
NIO
,201
3TH
EV
ALU
E O
F D
ISTR
IBU
TED
SO
LAR
ELE
CTR
ICG
EN
ER
ATIO
N T
O S
AN
AN
TON
IO
Sys
tem
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To q
uant
ify t
he v
alue
pro
vid
ed b
y gr
id-c
onne
cted
, dis
trib
uted
P
V in
San
Ant
onio
from
a u
tility
per
spec
tive.
GE
OG
RA
PH
IC F
OC
US
CP
S E
nerg
y te
rrito
ry
SY
ST
EM
CO
NT
EX
TM
unic
ipal
util
ity
LEV
EL
OF
SO
LAR
AN
ALY
ZE
D1.
1-2.
2% o
f pea
k lo
ad (b
y ca
pac
ity)
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
EU
tility
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISS
ingl
e m
argi
nal r
esou
rce
assu
med
, ELC
C a
pp
roac
h
TO
OLS
US
ED
•S
olar
Any
whe
re•
PV
Sim
ulat
or•
DG
Valu
ator
Hig
hlig
hts
•Th
e st
udy
conc
lud
es t
hat
DP
V p
rovi
des
sig
nific
ant
valu
e to
CP
S E
nerg
y, p
rimar
ily d
riven
by
ener
gy, g
ener
atio
n ca
pac
ity d
efer
men
t, a
nd fu
el p
rice
hed
ge v
alue
. The
stu
dy
is b
ased
sol
ely
on
pub
licly
-ava
ilab
le d
ata;
it n
otes
tha
t re
sults
wou
ld b
e m
ore
rep
rese
ntat
ive
with
act
ual fi
nanc
ial a
nd
oper
atin
g d
ata.
Val
ue is
a le
veliz
ed o
ver
30 y
ears
.
•Th
e st
udy
note
s th
at v
alue
like
ly d
ecre
ases
with
incr
easi
ng p
enet
ratio
n, a
lthou
gh h
ighe
r p
enet
ratio
n le
vels
nee
ded
to
estim
ate
this
dec
reas
e w
ere
not
anal
yzed
.
•Th
e st
udy
ackn
owle
dge
d b
ut d
id n
ot q
uant
ify a
num
ber
of o
ther
val
ues
incl
udin
g cl
imat
e ch
ange
m
itiga
tion,
env
ironm
enta
l miti
gatio
n, a
nd e
cono
mic
dev
elop
men
t.
Ene
rgy
= T
he s
tud
y sh
ows
high
ene
rgy
valu
e co
mp
ared
to
othe
r st
udie
s, d
riven
by
usin
g E
IA’s
“ad
vanc
ed g
as t
urb
ine”
with
a h
igh
heat
rat
e as
the
mar
gina
l res
ourc
e.
The
natu
ral g
as p
rice
fore
cast
is b
ased
on
NY
ME
X fo
rwar
d m
arke
t ga
s p
rices
, the
n es
cala
ted
at
a co
nsta
nt r
ate.
Ene
rgy
loss
es a
re in
clud
ed in
ene
rgy
valu
e, a
nd a
re
calc
ulat
ed o
n an
hou
rly m
argi
nal b
asis
.
Gen
erat
ion
cap
acit
y =
Gen
erat
ion
cap
acity
val
ue is
DP
V’s
dep
end
able
cap
acity
tim
es t
he fi
xed
cos
ts o
f an
“ad
vanc
ed g
as t
urb
ine”
, ass
umed
to
be
the
mar
gina
l re
sour
ce. D
epen
dab
le c
apac
ity b
ased
on
ELC
C; t
he r
epor
ted
ELC
C is
sig
nific
antly
hi
gher
tha
n ot
her
stud
ies.
Eve
ry in
stal
led
uni
t of
DP
V is
giv
en g
ener
atio
n ca
pac
ity
valu
e.
T&
D c
apac
ity
= T
he s
tud
y ta
kes
a tw
o st
ep a
pp
roac
h: fi
rst,
an
econ
omic
sc
reen
ing
to d
eter
min
e ex
pan
sion
pla
n co
sts
and
load
gro
wth
exp
ecta
tions
by
geog
rap
hic
area
, and
sec
ond
, to
asse
ss t
he c
orre
latio
n of
DP
V a
nd lo
ad in
the
m
ost
pro
mis
ing
loca
tions
.
Fina
ncia
l (Fu
el p
rice
hed
ge)
= T
he s
tud
y es
timat
es h
edge
val
ue a
s a
com
bin
atio
n of
tw
o fin
anci
al in
stru
men
ts, r
isk-
free
zer
o-co
upon
bon
ds
and
a s
et o
f nat
ural
gas
fu
ture
s co
ntra
cts,
to
rep
rese
nt t
he a
void
ed c
ost
of r
educ
ing
fuel
pric
e vo
latil
ity r
isk.
Env
iro
nmen
tal =
The
stu
dy
qua
ntifi
ed e
nviro
nmen
tal v
alue
, as
show
n in
the
cha
rt
abov
e, b
ut d
id n
ot in
clud
e it
in it
s fin
al a
sses
smen
t of
ben
efit
sinc
e th
e st
udy
was
fr
om t
he u
tility
per
spec
tive.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
05101520
Ene
rgy
Gen
Cap
T&D
Cap
Fina
ncia
lE
nvTo
tal
(cents/kWh $2012)
17.1
6
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 53
of 5
9
AU
STI
NE
NE
RG
Y&
CLE
AN
PO
WE
RR
ES
EA
RC
H,2
006
THE
VA
LUE
OF
DIS
TRIB
UTE
DP
HO
TOV
OLT
AIC
S IN
AU
STI
NE
NE
RG
Y A
ND
TH
E C
ITY
OF
AU
STI
N
Hig
hlig
hts
•Th
e st
udy
eval
uate
d 7
ben
efits
–ene
rgy
pro
duc
tion,
line
loss
es, g
ener
atio
n ca
pac
ity, T
&D
cap
acity
, re
activ
e p
ower
con
trol
(grid
sup
por
t), e
nviro
nmen
t, n
atur
al g
as p
rice
hed
ge (fi
nanc
ial),
and
dis
aste
r re
cove
ry (s
ecur
ity).
•Th
e an
alys
is a
ssum
ed a
15
MW
sys
tem
in 7
PV
sys
tem
orie
ntat
ions
, inc
lud
ing
5 fix
ed a
nd 2
sin
gle-
axis
.
•A
void
ed e
nerg
y co
sts
are
the
mos
t si
gnifi
cant
sou
rce
of v
alue
(ab
out
two-
third
s of
the
tot
al v
alue
), w
hich
is
hig
hly
sens
itive
to
the
pric
e of
nat
ural
gas
.
•D
istr
ibut
ion
cap
acity
def
erra
l val
ue w
as r
elat
ivel
y m
inim
al. A
E p
erso
nnel
est
imat
ed t
hat
15%
of t
he
dis
trib
utio
n ca
pac
ity e
xpan
sion
pla
ns h
ave
the
pot
entia
l to
be
def
erre
d a
fter
the
firs
t te
n ye
ars
(ass
umin
g gr
owth
rat
es r
emai
n co
nsta
nt).
Ther
efor
e, t
he s
tud
y as
sum
ed t
hat
curr
ently
bud
gete
d d
istr
ibut
ion
pro
ject
s w
ere
not
def
erra
ble
, but
the
ad
diti
on o
f PV
cou
ld p
ossi
bly
def
er d
istr
ibut
ion
pro
ject
s in
the
11t
h ye
ar o
f the
stu
dy
per
iod
.
•Tw
o st
udie
d v
alue
s w
ere
excl
uded
from
the
fina
l res
ults
:
•W
hile
rea
ctiv
e p
ower
ben
efits
was
est
imat
ed, t
he v
alue
($0-
$20/
kW) w
as a
ssum
ed n
ot t
o ju
stify
the
co
st o
f the
inve
rter
tha
t w
ould
be
req
uire
d t
o ac
cess
the
ben
efit.
(The
est
imat
ed c
ost
was
not
in
clud
ed.)
•Th
e va
lue
of d
isas
ter
reco
very
cou
ld b
e si
gnifi
cant
but
mor
e w
ork
is n
eed
ed b
efor
e th
is v
alue
can
be
exp
licitl
y ca
ptu
red
.
54*E
LCC
was
eva
luat
ed fr
om 0
%-2
0%; h
owev
er, t
he E
LCC
est
imat
e fo
r 2%
p
enet
ratio
n w
as u
sed
in fi
nal v
alue
.
ST
UD
YC
HA
RA
CT
ER
IST
ICS
ST
UD
YO
BJE
CT
IVE
To q
uant
ify t
he c
omp
rehe
nsiv
e va
lue
of D
PV
to
Aus
tin E
nerg
y (A
E)
in 2
006
and
doc
umen
t m
etho
dol
ogie
s to
ass
ist
AE
in p
erfo
rmin
g an
alys
is a
s co
nditi
ons
chan
ge a
nd a
pp
ly t
o ot
her
tech
nolo
gies
GE
OG
RA
PH
ICF
OC
US
Aus
tin, T
X
SY
ST
EM
CO
NT
EX
TM
unic
ipal
util
ity
SO
LAR
PE
NE
TR
ATIO
N L
EV
EL
AN
ALY
ZE
D2%
* sy
stem
pea
k lo
ad
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
Util
ity, r
atep
ayer
, par
ticip
ant,
soc
iety
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISP
V c
apac
ity v
alue
(ELC
C) c
alcu
late
d s
yste
m w
ide;
Dis
trib
utio
n ex
pan
sion
TO
OLS
US
ED
CP
R in
tern
al a
naly
sis;
sat
ellit
e so
lar
dat
a; P
VFO
RM
4.0
for
sola
r si
mul
atio
n; A
E’s
load
flow
ana
lysi
s fo
r T&
D lo
sses
Ene
rgy
= P
V o
utp
ut p
lus
loss
sav
ings
tim
es m
argi
nal e
nerg
y co
st.
Mar
gina
l ene
rgy
cost
sar
e b
ased
on
fuel
and
O&
M c
osts
of t
he
gene
rato
r m
ost
likel
y op
erat
ing
on t
he m
argi
n (ty
pic
ally
, a c
omb
ined
cy
cle
gas
turb
ine)
.
Loss
es =
Com
put
ed d
iffer
ently
dep
end
ing
upon
ben
efit
cate
gory
. For
all
cate
gorie
s, lo
ss s
avin
gs a
re c
alcu
late
d h
ourly
on
the
mar
gin.
Gen
erat
ion
cap
acit
y =
Cos
t of
cap
acity
tim
es P
V's
effe
ctiv
e lo
ad
carr
ying
cap
abili
ty (E
LCC
), ta
king
into
acc
ount
loss
sav
ings
.
Fina
ncia
l (Fu
el p
rice
hed
ge
valu
e) =
Cos
t to
elim
inat
e th
e fu
el p
rice
unce
rtai
nty
asso
ciat
ed w
ith n
atur
al g
as g
ener
atio
n th
roug
h p
rocu
rem
ent
of c
omm
odity
futu
res.
Fue
l pric
e he
dge
val
ue is
incl
uded
in t
he e
nerg
y va
lue.
T&
D c
apac
ity
= E
xpec
ted
long
-ter
m T
&D
sys
tem
cap
acity
up
grad
e co
st, d
ivid
ed b
y lo
ad g
row
th, t
imes
fina
ncia
l ter
m, t
imes
a fa
ctor
tha
t re
pre
sent
s m
atch
bet
wee
n P
V s
yste
m o
utp
ut (a
dju
sted
for
loss
es) a
nd
T&D
sys
tem
load
.
Env
iro
nmen
tal b
enefi
ts =
PV
out
put
tim
es R
EC
pric
e—th
e in
crem
enta
l co
st o
f offs
ettin
g a
unit
of c
onve
ntio
nal g
ener
atio
n.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
0
3.75
7.50
11.2
5
15.0
0
(cents/kWh $2012)
Ene
rgy
Loss
esG
enC
apTo
tal
T&D
Cap
Env
.
12.2
6
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3P
age
54 o
f 59
AU
STI
NE
NE
RG
Y&
CLE
AN
PO
WE
RR
ES
EA
RC
H,2
012
DE
SIG
NIN
GA
US
TIN
EN
ER
GY'S
SO
LAR
TAR
IFF
US
ING
AD
ISTR
IBU
TED
PV
CA
LCU
LATO
R
55
ST
UD
YC
HA
RA
CT
ER
IST
ICS
ST
UD
YO
BJE
CT
IVE
To d
esig
n a
resi
den
tial s
olar
tar
iff b
ased
on
the
valu
e of
sol
ar e
nerg
y ge
nera
ted
from
DP
V s
yste
ms
to A
ustin
Ene
rgy
GE
OG
RA
PH
ICF
OC
US
Aus
tin, T
X
SY
ST
EM
CO
NT
EX
TM
unic
ipal
util
ity w
ith a
cces
s to
ISO
(ER
CO
T)
SO
LAR
PE
NE
TR
ATIO
N L
EV
EL
AN
ALY
ZE
DA
ssum
ed t
o b
e 20
12 le
vels
of p
enet
ratio
n (5
MW
)1 <0.
5%p
enet
ratio
n b
y en
ergy
2
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
ES
Util
ity
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISA
ssum
ed t
o re
plic
ate
gran
ular
ity o
f AE
/CP
R 2
006
stud
y
TO
OLS
US
ED
Cle
an P
ower
Res
earc
h’s
Dis
trib
uted
PV
Val
ue C
alcu
lato
r; S
olar
A
nyw
here
, 201
2
Ene
rgy
= P
V o
utp
ut p
lus
loss
sav
ings
tim
es m
argi
nal e
nerg
y co
st.
Mar
gina
l ene
rgy
cost
sar
e b
ased
on
fuel
and
O&
M c
osts
of t
he
gene
rato
r m
ost
likel
y op
erat
ing
on t
he m
argi
n (ty
pic
ally
, a c
omb
ined
cy
cle
gas
turb
ine)
.
Loss
es =
Com
put
ed d
iffer
ently
dep
end
ing
upon
ben
efit
cate
gory
. For
al
l cat
egor
ies,
loss
sav
ings
are
cal
cula
ted
hou
rly o
n th
e m
argi
n.
Gen
erat
ion
cap
acit
y =
Cos
t of
cap
acity
tim
es P
V's
effe
ctiv
e lo
ad
carr
ying
cap
abili
ty (E
LCC
), ta
king
into
acc
ount
loss
sav
ings
.
Fuel
pri
ce h
edg
e va
lue
= C
ost
to e
limin
ate
the
fuel
pric
e un
cert
aint
y as
soci
ated
with
nat
ural
gas
gen
erat
ion
thro
ugh
pro
cure
men
t of
co
mm
odity
futu
res.
Fue
l pric
e he
dge
val
ue is
incl
uded
in t
he e
nerg
y va
lue.
T&
D c
apac
ity
= E
xpec
ted
long
-ter
m T
&D
sys
tem
cap
acity
up
grad
e co
st, d
ivid
ed b
y lo
ad g
row
th, t
imes
fina
ncia
l ter
m, t
imes
a fa
ctor
tha
t re
pre
sent
s m
atch
bet
wee
n P
V s
yste
m o
utp
ut (a
dju
sted
for
loss
es) a
nd
T&D
sys
tem
load
.
Env
iro
nmen
tal b
enefi
ts =
PV
out
put
tim
es R
enew
able
Ene
rgy
Cre
dit
(RE
C) p
rice—
the
incr
emen
tal c
ost
of o
ffset
ting
a un
it of
con
vent
iona
l ge
nera
tion.
1 ht
tp:/
/ww
w.a
ustin
ener
gy.c
om/A
bou
t%20
Us/
New
sroo
m/R
epor
ts/s
olar
Goa
lsU
pd
ate.
pd
f2
http
://w
ww
.aus
tinen
ergy
.com
/Ab
out%
20U
s/N
ewsr
oom
/Rep
orts
/20
12A
nnua
lPer
form
ance
Rep
ortD
RA
FT.p
df
Hig
hlig
hts
•Th
e st
udy
focu
sed
on
6 b
enefi
ts–e
nerg
y, g
ener
atio
n ca
pac
ity, f
uel p
rice
hed
ge v
alue
(inc
lud
ed in
ene
rgy
savi
ngs)
, T&
D c
apac
ity, a
nd e
nviro
nmen
tal b
enefi
ts–w
hich
rep
rese
nt “
a ‘b
reak
-eve
n’ v
alue
...at
whi
ch t
he
utili
ty is
eco
nom
ical
ly n
eutr
al t
o w
heth
er it
sup
plie
s su
ch a
uni
t of
ene
rgy
or o
bta
ins
it fr
om t
he c
usto
mer
.”
The
app
roac
h, w
hich
bui
lds
on t
he 2
006
CP
R s
tud
y, is
“an
avo
ided
cos
t ca
lcul
atio
n at
hea
rt, b
ut im
pro
ves
on [a
n av
oid
ed c
ost
calc
ulat
ion]
... b
y ca
lcul
atin
g a
uniq
ue, a
nnua
lly a
dju
sted
val
ue fo
r d
istr
ibut
ed s
olar
en
ergy
.”
•Th
e fix
ed, s
outh
-fac
ing
PV
sys
tem
with
a 3
0-d
egre
e til
t, t
he m
ost
com
mon
con
figur
atio
n an
d o
rient
atio
n in
A
E’s
ser
vice
ter
ritor
y of
ap
pro
xim
atel
y 1,
500
DP
V s
yste
ms,
was
use
d a
s th
e re
fere
nce
syst
em.
•A
s w
ith t
he A
E/C
PR
200
6 st
udy,
avo
ided
ene
rgy
cost
s ar
e th
e m
ost
sign
ifica
nt s
ourc
e of
val
ue, w
hich
is
very
sen
sitiv
e to
nat
ural
gas
pric
e as
sum
ptio
ns.
•Th
e le
veliz
ed v
alue
of s
olar
was
cal
cula
ted
to
tota
l $12
.8/k
Wh.
•Tw
o se
par
ate
calc
ulat
ion
app
roac
hes
wer
e us
ed t
o es
timat
e th
e ne
ar t
erm
and
long
ter
m v
alue
, com
bin
ed
to r
epre
sent
the
“to
tal b
enefi
ts o
f DP
V t
o A
ustin
Ene
rgy”
ove
r th
e lif
e tim
e of
a D
PV
sys
tem
. •
For
the
the
near
ter
m (2
yea
rs) v
alue
of D
PV
ene
rgy,
A P
V o
utp
ut w
eigh
ted
nod
al p
rice
was
use
d t
o tr
y to
cap
ture
the
rel
ativ
ely
good
cor
rela
tion
bet
wee
n P
V o
utp
ut a
nd e
lect
ricity
dem
and
(and
hig
h p
rice)
th
at is
not
cap
ture
d in
the
ave
rage
nod
al p
rice.
•To
val
ue t
he D
PV
ene
rgy
pro
duc
ed d
urin
g th
e m
id a
nd lo
ng t
erm
–thr
ough
the
res
t of
the
30-
year
as
sum
ed li
fe o
f sol
ar P
V s
yste
ms –
the
typ
ical
val
ue c
alcu
lato
r m
etho
dol
ogy
was
use
d.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
0
3.75
7.50
11.2
5
15.0
0
(cents/kWh $2012)
Ene
rgy
Gen
Cap
T&D
Cap
Env
.To
tal
Loss
es
12.8
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3P
age
55 o
f 59
56
NA
VIG
AN
T C
ON
SU
LTIN
G F
OR
NR
EL,
2008
PH
OTO
VO
LTA
ICS
VA
LUE
AN
ALY
SIS
Stu
dy
Cha
ract
eris
tics
ST
UD
Y O
BJE
CT
IVE
To s
umm
ariz
e an
d d
escr
ibe
the
met
hod
olog
ies
and
ran
ge o
f val
ues
for
the
cost
s an
d v
alue
s of
19
serv
ices
pro
vid
ed o
r ne
eded
by
DP
V fr
om e
xist
ing
stud
ies.
GE
OG
RA
PH
IC F
OC
US
Stu
die
s re
view
ed r
eflec
ted
var
ying
geo
grap
hies
; cas
e st
udie
s fr
om T
X, C
A,
MN
, WI,
MD
, NY,
MA
, and
WA
SY
ST
EM
CO
NT
EX
Tn/
a
LEV
EL
OF
SO
LAR
AN
ALY
ZE
Dn/
a
STA
KE
HO
LDE
R P
ER
SP
EC
TIV
EP
artic
ipat
ing
cust
omer
s, u
tiliti
es, r
atep
ayer
s, s
ocie
ty
GR
AN
ULA
RIT
Y O
F A
NA
LYS
ISn/
a
TO
OLS
US
ED
•C
usto
m-d
esig
ned
Exc
el t
ool t
o co
mp
are
resu
lts a
nd s
ensi
tiviti
es
Hig
hlig
hts
•Th
ere
are
19 k
ey v
alue
s of
dis
trib
uted
PV,
but
the
stu
dy
conc
lud
es t
hat
only
6 h
ave
sign
ifica
nt
ben
efits
(ene
rgy,
gen
erat
ion
cap
acity
, T&
D c
osts
, GH
G e
mis
sion
s, c
riter
ia a
ir p
ollu
tant
em
issi
ons,
an
d im
plic
it va
lue
of P
V).
•D
eplo
ymen
t lo
catio
n an
d s
olar
out
put
pro
file
are
the
mos
t si
gnifi
cant
driv
ers
of D
PV
val
ue.
•S
ever
al v
alue
s re
qui
re a
dd
ition
al R
&D
to
esta
blis
h a
stan
dar
diz
ed q
uant
ifica
tion
met
hod
olog
y.
•Va
lue
can
be
pro
activ
ely
incr
ease
d.
Ene
rgy
= E
nerg
y va
lue
is fu
el c
ost
times
the
hea
t ra
te p
lus
oper
atin
g an
d m
aint
enan
ce
cost
s fo
r th
e m
argi
nal p
ower
pla
nt, g
ener
ally
ass
umed
to
be
natu
ral g
as.
Loss
es =
Avo
ided
loss
val
ue is
the
am
ount
of l
oss
asso
ciat
ed w
ith e
nerg
y, g
ener
atio
n ca
pac
ity, T
&D
cap
acity
, and
env
ironm
enta
l im
pac
t, t
imes
the
cos
t of
tha
t lo
ss.
Gen
erat
ion
cap
acit
y =
Gen
erat
ion
cap
acity
val
ue is
the
cap
ital c
ost
of t
he m
argi
nal
pow
er p
lant
tim
es t
he d
epen
dab
le c
apac
ity (E
LCC
) of D
PV.
T&
D c
apac
ity
= T
&D
cap
acity
val
ue is
T&
D in
vest
men
t p
lan
cost
s tim
es t
he v
alue
of
mon
ey t
imes
the
dep
end
able
cap
acity
, div
ided
by
load
gro
wth
, lev
eliz
ed.
Gri
d s
upp
ort
ser
vice
s (A
ncill
ary
Ser
vice
s) =
Anc
illar
y se
rvic
es in
clud
e VA
R s
upp
ort,
lo
ad fo
llow
ing,
op
erat
ing
rese
rves
, and
dis
pat
ch a
nd s
ched
ulin
g. P
V is
unl
ikel
y to
be
able
to
pro
vid
e al
l of t
hese
.
Fina
ncia
l (Fu
el p
rice
hed
ge,
Mar
ket
pri
ce r
esp
ons
e) =
Hed
ge v
alue
is t
he c
ost
to
guar
ante
e a
por
tion
of e
lect
ricity
cos
ts a
re fi
xed
. Red
uced
dem
and
for
elec
tric
ity
dec
reas
es t
he p
rice
of e
lect
ricity
for
all c
usto
mer
s an
d c
reat
es a
cus
tom
er s
urp
lus.
Sec
urit
y =
Cus
tom
er r
elia
bili
ty in
the
form
of i
ncre
ased
out
age
sup
por
t ca
n b
e re
aliz
ed,
but
onl
y w
hen
DP
V is
cou
ple
d w
ith s
tora
ge.
Env
iro
nmen
t (C
rite
ria
air
po
lluta
nts,
Car
bo
n) =
Val
ue is
eith
er t
he m
arke
t va
lue
of
pen
altie
s or
cos
ts, o
r th
e va
lue
of a
void
ed h
ealth
cos
ts a
nd s
hort
ened
life
times
.Car
bon
valu
e is
the
em
issi
on in
tens
ity o
f the
mar
gina
l res
ourc
e tim
es t
he v
alue
of e
mis
sion
s.
Cus
tom
er =
Val
ue t
o cu
stom
er o
f hav
ing
gree
n op
tion,
as
ind
icat
e b
y th
eir
will
ingn
ess
to p
ay.
DP
V c
ost
= C
osts
incl
ude
cap
ital c
ost
of e
qui
pm
ent
plu
s fix
ed o
per
atin
g an
d
mai
nten
ance
cos
ts.
OV
ER
VIE
W O
F VA
LUE
CAT
EG
OR
IES
-60
-45
-30
-150153045
(cents/kWh $2012)
Energy
Losses
Gen Cap
DPV
T&D Cap
GridSupport
Fuel Hedge
Mkt Elas
Security
Pollutants
Carbon
Customer
Benefits Total
Total
-5.1
2
AV
ER
AG
EV
ALU
ES
FR
OM
ST
UD
Y
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 56
of 5
9
05SO
UR
CE
S
U-1
7302
ELP
C/R
abag
o E
xhib
it K
RR
-3
Pag
e 57
of 5
9
STU
DIE
S R
EV
IEW
ED
IN A
NA
LYS
IS
Stu
dy
Fun
ded
/ C
om
mis
sio
ned
by
Pre
par
ed b
y
SA
IC. 2
013
Up
dat
ed S
olar
PV
Val
ue R
epor
t. A
rizon
a P
ublic
Ser
vice
. May
, 201
3.A
rizon
a P
ublic
Ser
vice
SA
IC (c
omp
any
that
too
k ov
er R
.W. B
eck)
Bea
ch, R
., M
cGui
re, P
., Th
e B
enefi
ts a
nd C
osts
of S
olar
Dis
trib
uted
Gen
erat
ion
for
Ariz
ona
Pub
lic S
ervi
ce. C
ross
bor
der
Ene
rgy
May
, 201
3.C
ross
bor
der
Ene
rgy
Nor
ris, B
., Jo
nes,
N. T
he V
alue
of D
istr
ibut
ed S
olar
Ele
ctric
Gen
erat
ion
to S
an
Ant
onio
. Cle
an P
ower
Res
earc
h &
Sol
ar S
an A
nton
io, M
arch
201
3.D
OE
Sun
shot
Initi
ativ
eC
lean
Pow
er R
esea
rch
& S
olar
San
Ant
onio
Bea
ch, R
., M
cGui
re, P
., E
valu
atin
g th
e B
enefi
ts a
nd C
osts
of N
et E
nerg
y M
eter
ing
for
Res
iden
tial C
usto
mer
s in
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ross
bor
der
Ene
rgy,
Jan
. 201
3.Vo
te S
olar
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ativ
eC
ross
bor
der
Ene
rgy
Rab
ago,
K.,
Nor
ris, B
., H
off,
T., D
esig
ning
Aus
tin E
nerg
y's
Sol
ar T
ariff
Usi
ng A
D
istr
ibut
ed P
V C
alcu
lato
r. C
lean
Pow
er R
esea
rch
& A
ustin
Ene
rgy,
201
2.A
ustin
Ene
rgy
Cle
an P
ower
Res
earc
h &
Sol
ar S
an A
nton
io
Per
ez, R
., N
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, B.,
Hof
f, T.
, The
Val
ue o
f Dis
trib
uted
Sol
ar E
lect
ric G
ener
atio
n to
N
ew J
erse
y an
d P
enns
ylva
nia.
Cle
an P
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Res
earc
h, 2
012.
The
Mid
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ntic
Sol
ar E
nerg
y In
dus
trie
s A
ssoc
iatio
n, &
The
Pen
nsyl
vani
a S
olar
Ene
rgy
Ind
ustr
ies
Ass
ocia
tion
Cle
an P
ower
Res
earc
h
Mill
s, A
., W
iser
, R.,
Cha
nges
in t
he E
cono
mic
Val
ue o
f Var
iab
le G
ener
atio
n at
Hig
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enet
ratio
n Le
vels
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Cas
e S
tud
y of
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iforn
ia. L
awre
nce
Ber
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y N
atio
nal
Lab
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ory,
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e 20
12.
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E o
ffice
of E
nerg
y E
ffici
ency
and
Ren
ewab
le
Ene
rgy
and
Offi
ce o
f Ele
ctric
ity D
eliv
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and
E
nerg
y R
elia
bili
tyLa
wre
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Ber
kele
y N
atio
nal L
abor
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y
Ene
rgy
and
Env
ironm
enta
l Eco
nom
ics,
Inc.
Tec
hnic
al P
oten
tial f
or L
ocal
Dis
trib
uted
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alifo
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ent.
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Cal
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ublic
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mis
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Env
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enta
l Eco
nom
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Inc.
(E3)
Ene
rgy
and
Env
ironm
enta
l Eco
nom
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ublic
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uted
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le E
nerg
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atin
g Im
pac
ts a
nd V
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tion
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a P
ublic
Ser
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c w
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Sol
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ns, L
LC,
Pha
sor
Ene
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c, &
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mit
Blu
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T., E
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d C
apac
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volta
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Fran
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volta
ics
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ustin
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tin E
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ccel
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iden
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The
P
acka
rd F
ound
atio
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OTH
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WO
RK
S R
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RE
NC
ED
0.004
0.002
1.A
mer
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s fo
r S
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Pow
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uild
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V V
alue
in C
alifo
rnia
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2.B
eck,
R.W
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my:
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alifo
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optin
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ost-
Ben
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Met
hod
olog
y Fo
r D
istr
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ed G
ener
atio
n, 2
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6.E
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y an
d E
nviro
nmen
tal E
cono
mic
s, In
c. a
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olog
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