Overview

In a variety of projects, government agencies

are demonstrating the economic and environmental value of using distributed energy

resources to provide reliable electricity for

Federal facilities. These projects show how

renewable distributed energy resources (DER)

can be effectively integrated into utility power

grids to provide added power during peak

demand periods in populous regions of the

nation. 

In one recent demonstration project, the

United States Postal Service (USPS) worked

with the U.S. Department of Energy (DOE)

Federal Energy Management Program (FEMP)

to install a photovoltaic (PV) DER system at

the USPS Marina Processing and Distribution

Center in Marina del Rey, California. In this

collaborative project, the agencies were assisted by a national laboratory, the local utility,

and private-sector companies. As a result, a

127-kilowatt (kW) rooftop PV system—the

largest roof-integrated Federal system in the

nation—now generates electricity for the

Marina Center directly from sunlight. This PV

system is expected to shave up to 10% off the

facility’s 1.2-MW peak power demand and

save approximately

$25,000 per year in

utility costs.

Background

Californians have experienced several serious

energy supply and delivery problems in the

past few years. In some areas, not enough

power has been generated to meet peak

demand, and utility line capacity has not been

sufficient to carry all the power that customers

need during peak demand periods. DER 

Photovoltaic DER System Could Save USPS $25,000 per Year

in Marina del Rey, California

The U.S. Postal Service is demonstrating how to save energy, money, and the

environment by adding a solar electric system as a distributed energy resource

to reduce peak demand.

FEDERAL ENERGY MANAGEMENT PROGRAM

Distributed

Energy

Resources

Case Study

U.S. Department

of Energy

Office of Energy

Efficiency and

Renewable Energy

Internet: www.eren.doe.gov/femp/

Benefits of Distributed Energy

Resources

Distributed energy resources such as internal combustion engines, photovoltaics, wind systems,

microturbines, fuel cells, and energy storage systems can benefit Federal facilities in ways like these:

• Provide supplemental electric power at times of

peak demand (peak shaving)

• Help reduce utility-related electric and demand

charges

• Enable facilities to respond quickly to changing

needs because of their modularity

• Add capacity to the utility grid without the need

for a new power plant

• Enhance reliability and power quality

• Enhance energy security by ensuring fuel diversification and power for critical loads 

• Assist in reducing air emissions.

Project partners (left to

right) Joe VandenBerg and

Ray Levinson of the U.S.

Postal Service and Dan

Shugar of PowerLight Corp.

worked together to install

this 127-kilowatt

photovoltaic system on the

USPS Marina Center's

rooftop; the local utility,

Los Angeles Department of

Water and Power, was also 

a major contributor to the

project.

George Marsh/PIX11017
FEDERAL ENERGY MANAGEMENT PROGRAM

2

systems can help solve problems

like these by offsetting some of the

demand on the power grid when the

systems are installed close to the

customer’s load. 

DER systems are small, decentralized, grid-connected or off-grid

power-generating technologies

located at or near the place where

the energy is used. Some DER systems—such as microturbines—

run on conventional fossil fuels.

Others—such as solar and wind 

systems—depend on renewable

energy resources. 

A solar DER system was chosen

for the USPS Marina Processing and

Distribution Center in Marina del

Rey, which is in sunny Los Angeles

County. The 409,630-square-foot

center, which processes millions of

pieces of mail every day, obtains

electricity from the Los Angeles

Department of Water and Power

(LADWP). LADWP offers, as part 

of its Solar Roofs Incentives

Program, a rebate of up to $6/W to

customers who install PV systems.

To qualify for the rebate, the PV 

system must be at least 300 kW and

may not produce more power than

the facility uses.

The utility rebate—as well as the

excellent solar resource, adequate

roof area, demonstrated system 

reliability, and low maintenance

requirements—made PV the clear

choice. The USPS was committed to

carrying out this project to meet

California’s need to reduce peak

demand on the local grid, control

costs, and help reduce the air emissions associated with many forms of

energy use. 

Project Summary

The USPS began by conducting a

roof assessment at the Marina

Center, which indicated that the 

roof could easily withstand the 

load of a solar energy system. The

size of the PV system was restricted

to less than 1 MW, primarily to keep

expenses within project funding

limits. Next, with technical assistance from staff at Lawrence

Berkeley National Laboratory

(LBNL), PowerLight Corporation

was chosen to design the PV system

and coordinate the installation.

PowerLight partnered with 

Siemens & Shell Solar to custommanufacture the system to meet the

needs of the center.

A PowerGuard® PV system was

then designed, built, and installed 

in six months. This system incorporates PV cells backed with polystyrene foam to produce power,

increase the building’s thermal insulation, and extend the life of the

roof. The PV system, which sits on

15,000 square feet of the center’s flat

roof, increases the effective R-value

of the built-up roof. Workers did not

have to penetrate the roof during the

PV system installation. 

George Marsh/PIX011015

The rooftop solar system at the USPS Marina del Ray Center in Los Angeles is based on 

a technology that uses polystyrene foam backing behind the PV cells, which also provides 

more thermal insulation to the building; the system should save about $25,000 per year 

in energy costs.

“Lawrence Berkeley National Laboratory, acting on behalf of FEMP, provided

invaluable assistance to this project. They helped us select the best

technologies, determine the proper system size, choose a location, and acquire

financial support. I would urge any Federal agency considering a similar project

to seek their assistance.”

—Ray Levinson, Area Environmental Manager, USPS
FEDERAL ENERGY MANAGEMENT PROGRAM

3

The PV system will not be a backup

source of power if a blackout should

occur, however. For safety reasons, if

the power supply in the grid is interrupted, an automatic disconnect on

the PV system will suspend operation until the grid is up and running

again. 

Although it does not provide power

during blackouts, the PV system 

has a role in improving energy 

efficiency at the facility. The system

is linked to a CMS Viron Energy

Services energy management system (EMS) that monitors power output from the solar cells. When the

EMS detects a decline in the system’s power output (for example, 

as a result of cloud cover), the EMS

automatically modifies the operation of the building’s chiller, air handlers, and blowers without affecting

the comfort levels of people in the

building. This should significantly

reduce the building’s energy

demand and help reduce demand

charges caused by power surges. 

In fact, the USPS Marina Center is

expecting up to a 10% reduction

in its current 1.2-MW peak

demand. 

As part of the project, PowerLight

will monitor and evaluate the 

system for two years, providing

quarterly reports to the USPS.

These performance assessments

will be used to determine how

well the system is operating, the

total savings provided, and the

potential for future installations

of this type. 

Financing for the project came

from several sources. Because

appropriated funds were not sufficient to cover all costs, project

managers had to look for alternative sources of funding. They

found that the $6/W rebate

offered by LADWP allowed them

to install a renewable energy system at a fraction of its usual cost.

They also responded to a call for

projects issued by DOE FEMP that

asked Federal agencies

to submit ideas for DER

projects. The call for

projects allowed agencies to apply for a portion of $200,000 in

Federal funding offered

for DER hardware purchases and technical

assistance services.

The demand for DER

funds was high; 89

applications were

received, and 20 projects

were ultimately funded.

By combining FEMP

funding with the rebate

from the local utility, the

Marina Center’s project

managers were able to

reduce their share of the total cost to

$225,000, which was paid for out of

USPS energy conservation funds. 

By leveraging these multiple sources

of funding, the USPS was able to

install a renewable energy DER system with a payback period of less

than 10 years, which compares well

with paybacks for other energy 

efficiency projects.

Benefits of Using PV Systems

for DER Applications 

DER systems like this one can provide a hedge against fluctuating

electricity prices, enhance energy

security by offsetting some demand

for utility power, and help reduce

harmful emissions. In some areas,

DER systems may even eliminate

the need for new or expanded

power plants.

George Marsh/PIX11016

The rooftop solar system at the USPS Marina

Center is linked to an energy management

system that monitors power output from the PV

cells and modifies the building's air-handling

and cooling systems, as needed.

About the USPS PV DER System 

System Rated Power 127 kW

Estimated Annual Energy Savings

Electricity Generated 228,600 kWh

Peak Demand Reduction 120 kW

Energy Cost Savings $25,000

System Economics

Total PV System Cost $1,033,000

LADWP Utility Rebate ($6/W) $683,000

FEMP DER Equipment Funding $125,000

System Cost to USPS $225,000

(Using USPS Energy 

Conservation Funds)

Simple Payback Period 9 years

(Considering USPS Funds Only)
Prepared for the U.S.

Department of Energy

Office of Energy Efficiency

and Renewable Energy

By the National Renewable

Energy Laboratory, a DOE

national laboratory

DOE/GO-102002-1602

November 2002

FEDERAL ENERGY MANAGEMENT PROGRAM

Printed with a renewable-source ink on paper containing at least 50% wastepaper, including 20% post consumer waste

The new DER PV system at the Marina

Center should save the USPS up to $25,000

per year through peak shaving. Peak-shaving

devices provide power for high-demand 

periods, eliminating excessive demand and

time-of-use charges and helping to avoid

community-wide power shortages.

PV systems are especially well suited for

peak-shaving applications at many Federal

facilities because peak electrical loads usually

occur when the solar resource is greatest (for

example, from morning until late in the afternoon). A consistent reduction in demand also

benefits other customers on the electricity

grid, particularly in capacity-constrained

areas.

This 127-kW PV system is designed to produce approximately 228,600 kWh per year. And

the system will save enough energy to avoid

104 lb of NOx, 3 lb of SO2, and 16 tons of CO2

emissions each year. It will save money, as

well, not only because of the peak power it

produces but also because it adds insulation,

and thus reduces cooling needs, inside the

building.

Lessons Learned

By taking advantage of valuable utility

rebates, as well as the assistance offered by

DOE FEMP and LBNL, the USPS saved

almost 80% of the initial cost of a similar system funded without rebates or other support.

The Marina Center system cost just under

$2/W, a bargain price for a PV DER system.

This shows the considerable economic benefit

that can be obtained by using all available

incentives and assistance in carrying out

Federal DER projects. States like California,

which offer significant rebates and state public benefit funds for DER projects, are excellent places for Federal agencies to focus on

DER projects. 

Looking Ahead

This PV DER demonstration project is helping the USPS to answer California’s call to

reduce electricity demand in that state. It also

demonstrates how Federal agencies can move

forward with DER projects without appropriated funds. Performance measurements will

help to determine whether similar projects

will be implemented at other USPS centers,

and they should clearly show the benefits of

Federal DER projects. 

For More Information

FEMP Help Desk

800-363-3732

International callers please use

703-287-8391

Web site: www.eren.doe.gov/femp/

Contacts

Shawn Herrera

Federal Energy Management 

Program, EE-90

U.S. Department of Energy

1000 Independence Ave., S.W.

Washington, DC 20585

Phone: 202-586-1511

Fax: 202-586-3000

Shawn.Herrera@ee.doe.gov

Arun Jhaveri

DOE Seattle Regional Office

800 Fifth Avenue, Suite 3950

Seattle, WA 98104

Phone: 206-553-2152

Fax: 206-553-2200

Arun.Jhaveri@ee.doe.gov

Bill Golove

Lawrence Berkeley National

Laboratory

1 Cyclotron Road, MS 90-4000

Berkeley, CA 94720

Phone: 510-486-5229

Fax: 510-486-6996 

WHGolove@lbl.gov