Valuing Energy Efficiency and Distributed Energy Resources in the Built Environment: Preprint

Traditionally, analytical frameworks that underpin building energy policy have focused on the need to reduce annual energy consumption by assessing the cost and efficiency performance of energy-consuming technologies. Investments in distributed energy resources (DERs) such as photovoltaics have generally been evaluated independently, but also on a cost and performance basis. However, buildings are rapidly evolving to incorporate technologies that not just consume energy, but also generate, store, and control energy loads. Concurrently, the electric grid is becoming more dynamic and variable due to the increased proportion electricity production from variable renewable sources. To that end, building energy policy analytical frameworks should be updated to include the interactions between energy efficiency and DERs as well as potential value streams for the grid and building owner that technologies or packages of technologies might offer. As buildings with DERs and controllable loads are able to provide grid services or optimize operations based on electricity rates and grid conditions, the temporal and spatial nature of these technologies should also be incorporated into design decisions. To explore these questions further, the National Renewable Energy Laboratory will use a series of building and electric grid models to simulate the design and operation of a neighborhood of buildings under various electricity rates, grid conditions, and potential compensation scenarios. Scenarios of time-sensitive values for future grid services will also be constructed for use in the analysis. New metrics that can be used in building energy policies will also be explored to capture the responsiveness or flexibility of high efficiency buildings with DERs under various electric grid conditions and future scenarios.