Assessment of Distributed Energy Adoption in Commercial Buildings. Part 1: An Analysis of Policy, Building loads, Tariff Design, and Technology Development

Rapidly growing electricity demand brings into question the ability of traditional grids to expand correspondingly while providing reliable service. An alternative path is the wider application of distributed energy resource (DER) that apply combined heat and power (CHP). It can potentially shave peak loads and satiate its growing thirst for electricity demand, improve overall energy efficiency, and lower carbon and other pollutant emissions. This research investigates a method of choosing economically optimal DER, expanding on prior studies at the Berkeley Lab using the DER design optimization program, the Distributed Energy Resources Customer Adoption Model (DER-CAM). DER-CAM finds the optimal combination of installed equipment from available DER technologies, given prevailing utility tariffs, site electrical and thermal loads, and a menu of available equipment. It provides a global optimization, albeit idealized, that shows how the site energy loads can be served at minimum cost by selection and operation of on-site generation, heat recovery, and cooling. Utility electricity and gas tariffs are key factors determining the economic benefit of a CHP installation, however often be neglected. This paper describes preliminary analysis on CHP investment climate in the U.S. and Japan. DER technologies, energy prices, and incentive measures has been investigated.