Distributed energy resources (DERs) are non-wire solutions that can enhance grid reliability and reduce costs. However, their value is often underrepresented in long-term capacity expansion models (CEMs). Excluding customer-sided resources from these models can lead to sub-optimal investments and missed savings opportunities for system planners.
This research explores methods for integrating different DERs into utility-scale resource planning models, focusing on three types of demand flexibility: curtailable load, conservation, and shiftable demand. By adopting a dynamic approach, all supply-side and demand-side resource options are evaluated endogenously against each other using an open-source, unit-level CEM model.
A case study quantitatively demonstrates the proposed approach. The results indicate that dynamically evaluating all supply-side and demand-side options against each other can lower overall system costs, reduce investments in renewables and energy storage, and decrease peak load and electricity prices compared to scenarios with limited DER alternatives. Specifically, co-optimizing all demand flexibility measures reduces the need for new storage capacity. In a more stringent decarbonization scenario, the low costs of flexible demand measures enable these resources to reach their maximum capacity which limits their ability to further displace other supply-side generation, making storage essential in scenarios with high penetration levels of renewables.
Authors Karen Tapia-Ahumada and Ryan Fulleman