Benefit-Cost Analysis Case Studies
Our June 2022 report Benefit-Cost Analysis Case Studies: Examples of Distributed Energy Resource Use Cases comprises three case studies that illustrate BCAs for DER technologies and use cases of growing interest in the electric industry. This report was developed by Smart Electric Power Alliance (SEPA) with technical and modeling support from ICF and serves as a compendium to the NSPM for DERs.
These case studies are informed by real-world examples and generalized into hypothetical examples using real-world data and illustrating approaches to accounting for impacts in BCA when certain data is unavailable. They add to the two simplified case studies contained in the NSPM (grid-interactive efficient buildings and non-wires solutions), by providing new applications of the NSPM BCA Framework, and shows how DER use cases drive DER assessment. The report includes the following use cases:
- Residential EV Managed Charging in the Midwest
- Commercial Solar + Storage Controlled Dispatch in the West
- Residential Grid-interactive Efficient Building Retrofit in the Mid-Atlantic
Each case study applies the NSPM to develop a primary cost-effectiveness test, and addresses:
- Relevant industry context for BCAs (e.g., expected growth in EV deployment and impacts to the electric grid);
- BCA challenges related to the DERs being analyzed;
- Current DER program examples;
- Key BCA assumptions: profile of assumed utility & grid; baseline program and proposed program comparison (e.g., assumed operating profile); relevant policy context and goals; value streams included in the BCA, with explanation of any excluded impacts;
- Description of data sources and summary of inputs; and
- Analysis results including BC ratios, supporting charts and graphics, and discussion of which variables drove the results and how those key factors/inputs might change by region/program.
Importantly, the case studies illustrate how a jurisdiction may account for a full range of utility system impacts as well as select host customer and societal impacts. They also address key cross-cutting issues (e.g., locational and temporal values, demand flexibility, interactive effects, and behind the meter considerations) and provide examples of differentiating between BCA and rate impact analyses.