A comprehensive methodology for assessing the costs and benefits of renewable generation on utility operations*

The recent increase in Renewable Generation (RG) has prompted many states, utilities, and other stakeholders to improve the methods used to determine the value of RG in efforts of replacing the Net Metering approach. However, these studies result in a wide range of values. This paper proposes a methodology based on the RG valuation studies conducted in recent years. The method includes the most common cost and benefit components considered in these studies and adopts a comprehensive method to calculate each component. The main categories include avoided energy, avoided generation capacity, avoided transmission capacity, avoided system losses, price hedging benefits, environmental benefits, and grid integration costs. A realistic case study emulating a large utility is also conducted to illustrate the application of the proposed method. The results show that all the main components can be estimated based on detailed system models or simulations. The results also illustrate some of the data challenges associated with such a study. (c) 2021 Elsevier Ltd. All rights reserved.

Automated summary

This paper proposes a methodology based on recent studies on Renewable Generation (RG) valuation, which includes various cost and benefit components and illustrates the application of the method through a case study emulating a large utility. The results show that all main components can be estimated based on detailed system models or simulations, while also revealing some data challenges associated with such studies.