# Presentation: 678108

## Value of DG Options for Congested T&D Systems in Mississippi and Florida: A Case Study

**Value of DG Options for Congested T&D Systems in ****Mississippi and Florida: ****A Case Study**

- Susan McCusker, Jack Siegel
- Energy Resources International

##                  Outline

- • Introduce study
- • Present EAEM
- • Describe modeling framework
- • Present DG options
- • Discuss MS site, benefit/cost analysis
- • Discuss FL site, benefit/cost analysis
- • Analyze results, conclude

**Notes:**
•The study explores the ability of distributed generation (DG) options to provide cost-effective alternatives to transmission, and distribution upgrades for alleviating transmission and distribution congestion. To demonstrate this ability for constrained sites in systems in the states of Florida and Mississippi, the Electricity Asset Evaluation Model (EAEM) is used to assess the costs and benefits of installing DG options to reduce load in areas with transmission congestion versus upgrading the transmission and distribution (T&D) systems. The States of Florida and Mississippi were selected as the regions of focus for this case study because: (1) they are dominated by large, regulated utilities that may not have the incentive to fully consider DG options, (2) electric utility deregulation is progressing very slowly, and as a result, may not be available to fully open competition for DG projects, and (3) DG is advancing slowly as compared with some other regions of the country.  As a result, if the analysis shows that DG offers potential advantages over other options normally considered by utilities in these states, it may influence the utilities in these states to give DG more consideration in the future.
•Discuss model inputs, what it does with the inputs, outputs.  Also features and limitations of the model
•Describe information available for MS/FL studies;  

## Study Background

- Study Wraps Together:
- Limited Success for DOE DG Program in SE U.S.
- Limited Site Specific Analytic Examples Using Real World Data
- Product that Could Show Importance of DG to Several Key Congressional People from MS and FL

## LRMC, Prices

**Coordination of Three Types of Models**

**Central System Investment:**
***Generation, Transmission, Contracts, DSM***
***(Linear Programming)***

**Local Planning Area**
**Investment & Dispatch:**
***Generation, Distribution, DSM***
***(Mixed Integer Programming)***

**Central System Operation:**
***DC Multiarea Probabilistic Production Costing***

***Central Assets***

***SRMC***

***Power Flows to/from Central System***

***    ******Central  System Planning Model***

## Local Areas:
Investment (Distribution, Generation, DSM) & Dispatch

- Investment (Distribution, Generation, DSM) & Dispatch

**Power System Representation**

**CR**

**DR**

**DR**

**DR**

**DR**

**DR**

**DR**

**DR**

**DR**

**DR**

**CR**

**CR**

**CR**

**CR**

***          ***_***Central System:***_
- Multiarea Investment, Dispatch & Bulk Transactions

## Model Applications

- • Constraint identification
- • Site-specific options analysis
- • Long-term expansion planning
- • Policy/technology evaluation

## Model Inputs & Outputs

*INPUTS*
- • Existing generation, T&D system characteristics
- • Projected loads
- • New asset options

*OUTPUTS*
- • When and where to locate new generation, T&D options to meet projected loads at lowest total system cost

## Model Features & Limitations

- + Comprehensive - accounts for system effects of local asset additions
- + Dynamic - recognizes costs & benefits across entire time horizon
- + Realistic T&D system representation
- - Real power flows only
- - Data availability
- - Linear program

## DG Options

## Mississippi System

## Configuring the Model:  MS

## Overall NPV Costs:  MS

## NPV Net Costs & Benefits:MS

## Costs & Benefits:  MS

## Florida System

| Grid: | G&T co-op and transmission 
systems of two other utilities. |
| --- | --- |
| Plants & Contracts: | 8 plants: $12 - $66/MWh; 8 contracts: $25 - $85/MWh; FORs 3 -20%. |
| Loads: | Dist. co-op: summer & winter peaks; G&T co-op: 2000 monthly peaks & energy consumption. |
| T&D constraint: | Overloaded corridor; projected 
distribution line loads > line ratings. |

## Configuring the Model:  FL

## Break-even Transmission Upgrade Costs:  FL

## Break-even Transmission Upgrade Costs:  FL

## Analysis

*FACTORS AFFECTING C/Bs*:
- • Renewable portfolio standards, tax credits
- • Environmental improvements
- • Energy security
- • Back-up interconnection and other fees
- • Study assumptions: grid (FL), generator availability, fuel prices

## Conclusions & Implications

- • DG assets located at high marginal cost areas can lower total costs.
- • Considering system-wide effects of DG assets across all load periods more accurately captures benefits.
- • Costs/benefits site specific; methodology, but not results applicable to other systems, assumptions.

## Proposed Next Steps

- Revise model runs to incorporate:
- renewable tax credits/other incentives
- local interconnection/other fees imposed by utilities
- Run sensitivities to:
- gas prices
- valuation of security/environmental benefits
- other factors