Dynamic generating costs in DSM planning

This paper deals with cost savings resulting from DSM, i.e. reductions in the number and cost of shut-downs and start-ups of generators. The proposed methodology applied to a test-data system yields savings of 28%. The total avoided costs are also estimated and it is pointed out on the basis of a total resource cost that the omission of these dynamic benefits can result in a bias against a DSM program and may lead to a wrong policy decision.