Methods for Analyzing the Benefits and Costs of Distributed Photovoltaic Generation to the U.S. Electric Utility System

NOTICE This report was prepared as an account of work sponsored by an agency of the United States government. Neither the United States government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States government or any agency thereof. Acknowledgments The authors would like to thank a number of people for material used in this report and input on early drafts of this report. In particular, the authors would like to thank Thomas Jenkin and Easan Drury for material used in Section 10 and Julieta Giraldez and Michael Coddington for material used in Appendix B. For their review and comments, the authors would like to thank the following individuals: CC combined cycle CCGT combined-cycle gas turbine CEMS continuous emissions monitoring system CO 2 carbon dioxide CSV comma-separated values CT combustion turbine DC direct current DCOPF decoupled optimal power flow DG distributed generation DGPV distributed-generation photovoltaics E3 Energy and Environmental Economics Inc. ED economic dispatch EIA U.S. Energy Information Administration ELCC effective load-carrying capacity EPA U.S. Environmental Protection Agency ERCOT Electric Reliability Council of Texas FERC Federal Energy Regulatory Commission GIS geographic information system GW gigawatts ISO Independent System Operator kW kilowatts kWh kilowatt-hours LMP locational marginal price LOLE loss of load expectation LOLP loss of load probability MIP mixed-integer programming MISO Midcontinent Independent System Operator MMBTU million British thermal units MW megawatts NO x nitrogen oxides NREL National Renewable Energy Laboratory NRM network reference model O&M operations and maintenance OPF optimal power flow PCM production cost model PHS pumped hydroelectric storage PNNL Pacific Northwest National Laboratory v This report is available at no cost from the National Renewable Energy Laboratory (NREL) at www.nrel.gov/publications. Executive Summary Distributed-generation photovoltaic (DGPV) systems are very different from traditional electricity-generating technologies like coal or natural gas power plants. Their electrical output is variable and has an element of uncertainty. A homeowner or …