The Value of Distributed Energy Resources for Heterogeneous Residential Consumers
For utilities and policymakers, it reveals limits of coordination benefits and distribution pricing impacts on distributed energy resource adoption.
This paper quantifies the value of rooftop photovoltaics and storage for heterogeneous residential consumers, finding that coordination services can reduce costs by an additional 10-15% but providers will not encourage adoption beyond 35-55% within a group.
The presence of behind-the-meter rooftop photovoltaics and storage in the residential sector is poised to increase significantly. Here we quantify in detail the value of these technologies to consumers and service providers. We characterize the heterogeneity in household electricity cost savings under time-varying prices due to consumption behavior differences. Different pricing policies significantly alter how households fare with respect to one another. Furthermore, household savings in absolute terms are not strongly correlated with savings normalized by PV and storage system size. We characterize the financial value of improved forecasting capabilities for a household, finding that it is a relatively small fraction of a household's cost savings. Coordination services that combine the resources available at all households can reduce costs by an additional 10% to 15% of the original total cost. Surprisingly, coordination service providers will not encourage adoption beyond 35-55% within a group. We present a simple model that explains the value of coordination and its relationship to the pricing of distribution services.