The reality of grid decarbonization is shifting the tectonic plates of the energy industry. Within the family of distributed energy resources (DERs), energy efficiency is the most established but also poised for the greatest disruption. 

Energy efficiency has long relied on deemed savings values to determine its grid impact and to compensate implementers. Our research features a meter-based, hourly savings analysis of a major residential energy efficiency program as well as a deep dive into the dynamics of wholesale energy market pricing. 

This paper navigates between competing approaches to DER valuation and illustrates how hourly usage data, the use of locational marginal pricing of energy at the grid node, and the strong correlation of weather to energy use can be combined to value energy efficiency at any given time of day and location. We reveal the concept of a CarbonWatt and discuss how this approach to valuing DER portfolios can enable new technologies and business models that will allow us to reach our decarbonization goals.

This research informs the development of a framework for valuing the time and locational value of distributed energy resources, resulting in a wholesale shift to a performance-based valuation approach based on addressing grid requirements.

This paper was originally presented at IEPEC 2019. Read it below:

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