Energy Efficiency in 

Distribution Systems

Impact Analysis Approach

11.30.2011
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 1

Table of Contents

1 Focus Area Overview

2 Technologies and Assets

3 Impact Analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 2

Focus Area Overview » Six Focus Areas

Six areas are of particular interest for determining smart grid impacts.

Note that AMI can be used to increase the functionality of distribution 

applications.

Peak Demand and 

Electricity Consumption

• Advanced Metering 

Infrastructure

• Pricing Programs and 

Customer Devices

• Direct Load Control

Operations and 

Maintenance Savings from 

Advanced Metering

• Meter Reading

• Service changes

• Outage management

Distribution System 

Reliability

• Feeder switching

• Monitoring and health 

sensors

Energy Efficiency in 

Distribution Systems

• Voltage optimization

• Conservation voltage 

reduction

• Line losses

Operations and 

Maintenance Savings from 

Distribution Automation

• Automated and remote 

operations

• Operational Efficiency

Transmission System 

Operations and Reliability

• Application of 

synchrophasor technology 

for wide area monitoring, 

visualization and control
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 3

Focus Area Overview » Benefits Framework

DOE’s Smart Grid Benefits Framework relates smart grid assets, functions and 

benefits.

Smart Grid Assets Higher 

Functionality

Benefits for 

Utilities, 

Consumers and 

Society

• Smart meters

• Automated 

switches

• Phasor 

measurement units

• Better load 

measurement and 

management

• Faster circuit 

switching

• Grid disturbance 

monitoring

• Peak load 

reduction

• Shorter outages

• Better grid 

reliability
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 4

Focus Area Overview » Voltage and VAR Control

Our analysis will try to determine how asset combinations can be used to 

reduce distribution losses and end-use energy consumption.

• Determine the improvement in energy efficiency from the application of 

technology used to optimize circuit voltage and implement conservation 

voltage reduction.

• Determine what technology configurations are most important for 

delivering measurable results.

• Quantify the value of energy and capacity savings for utilities, electricity 

savings for customers, and lower emissions.

Analysis Objectives
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 5

Table of Contents

1 Focus Area Overview

2 Technologies and Assets

3 Impact Analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 6

Voltage and VAR control technologies monitor power, determine control 

settings, and then physically adjust voltage and reactive power.

Equipment to change voltage and 

power factor

Technology to measure voltage and power factor, control equipment,

and coordinate/optimize settings

• Substation voltage and current 

sensors (including CTs/VTs)

• Distribution voltage and current 

sensors (typically included in 

control packages)

• SCADA to communicate readings 

back to central location

• Smart meters

• AMI communications to 

communicate readings back to 

central location

• Control packages for transformer 

load tap changers (LTCs)

• Control packages for capacitors

• Control packages for voltage 

regulators

• Distribution management 

systems and voltage optimization 

software

• Transformer LTCs

• Distribution capacitor banks

• Distribution voltage regulators

Capacitor bank

Voltage regulator

Control package

Distribution 

Management 

System

Line voltage 

sensor

Smart meter

Technologies and Assets » Tools for Managing Voltage and Power Factor
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 7

Technologies and Assets » Three General Objectives

Utilities are pursuing three general objectives as part of their SGIG projects.

Voltage and VAR 

Control (VVC)

Voltage Optimization 

(VO)

Conservation Voltage 

Reduction (CVR)

Operating transformer load tap-changers, line voltage 

regulators and capacitor banks to adjust voltage along a 

distribution circuit and compensate load power factor.

Coordinating VVC devices to achieve voltage profiles that 

meet the utility’s operational objectives, including energy 

delivery efficiency, power quality, and reliability.

Utilizing VVC and VO functionality to lower distribution 

voltages for energy savings, without causing customer 

voltages to fall below minimum operating limits.
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 8

Technologies and Assets » Basic Voltage Regulation with an LTC

Line voltage drops from the LTC at the head of the distribution line to 

customers farther out on the line.

S/S

2 3 4 5 6 7

Customer 

Loads at 

1MW each 1

LTC M

126V

114V

120V

127V

110V

7 mile feeder at 12.47 kV

Transformer 

Load Tap 

Changer

ANSI Standard

C84.1-1995

“A” Service 

Voltage Range

Hypothetical voltage profile
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 9

Technologies and Assets » Coordinated LTC and Voltage Regulator

A voltage regulator can boost (raise) or buck (lower) voltage at a point on the 

distribution line and regulate down-line voltage.

S/S

2 3 4 5 6 7

Customer 

Loads 1

LTC M

126V

114V

120V

127V

110V

Reg

Baseline Regulator Regulator + CVR

Line Voltage Regulator

The utility can use better voltage 

control to keep voltage closer to 

nominal, or lower it for a CVR effect.
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 10

Technologies and Assets » Coordinated LTC, Regulator and Capacitor Bank

A capacitor bank can help regulation by compensating for the lagging power 

factor of load and the line itself.

S/S

2 3 4 5 6 7

Customer 

Loads 1

LTC M

126V

114V

120V

127V

110V

Reg

Baseline Reg + Cap Reg + Cap + CVR

Cap

Capacitor Bank

Coordination of multiple control 

devices can produce a flatter voltage 

profile, and allow more aggressive CVR.
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 11

Technologies and Assets » Projects Deploying Automated Capacitors

Over 19,000 capacitor banks are being deployed by 41 projects as part of the 

SGIG program.

18

17

6

IOU

Muni/PPA 

Cooperative 18,558

542 208

IOU

Muni/PPA 

Cooperative

41 SGIG Projects Expected to Deploy 

Voltage and VAR Control Functionality

Number of Automated Capacitors 

Expected to be Deployed by Utility Type

Source: SGIG Build metrics and Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 12

Projects vary with utility objectives, operational experience, and current 

system configurations and equipment. 

Voltage 

Optimization

Conservation

Voltage Reduction 

Impact

Functionality SGIG Projects 

Voltage and VAR Control 17 

Voltage Optimization 11

Voltage Optimization and CVR 13

Total 41

Degree of Functionality 

Voltage and VAR 

Control

We expect that impact will increase 

with higher functionality

Technologies and Assets » Voltage and VAR Control Functionality

Source: SGIG Proposals, MBRPs Build metrics and Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 13

Technologies and Assets » Circuits with Automated Equipment

On average SGIG projects are installing automated equipment on about 25% of 

the circuits in their service territory. 

* Includes projects that are installing automated feeder switches on some 

or all of the circuits 

Number of Circuits with Automated Equipment vs. Total Service Territory 

Source: SGIG Build metrics and Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 14

Technologies and Assets » Deployment Expected vs. To-Date

Nearly 19,000 capacitor banks are being deployed as part of the SGIG program. 

More than 80% are being deployed by four Investor Owned Utilities.

Source: SGIG Build metrics and Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 15

$133 

$34 $58 $14 $27 

$-

$20 

$40 

$60 

$80 

$100 

$120 

$140 

Total Communications 

Infrastructure* 

Auto Capacitors Auto Regulators Distribution 

Management 

Systems*

Technologies and Assets » Investments in VVC Assets

As of Q2 2011, recipients had spent approximately $133 million on VVC assets.

Installed Costs ($ Millions) of Volt/Var 

and Supporting Equipment as of 2Q 2011 

•Fifty percent of total costs allocated to volt/var. Assumed other costs allocated to 

reliability initiatives

** Avg. Const / Unit estimates include communication infrastructure 

Avg. Cost / Unit**

Auto Capacitor $ 12,565 

Auto Regulator $ 8,781 

Source: SGIG Build metrics and Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 16

Table of Contents

1 Focus Area Overview

2 Technologies and Assets

3 Impact Analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 17

Impact Analysis » Key Metrics

Key metrics will be collected from SGIG and SGD projects for use in analyzing 

Voltage and VAR Control with smart grid.

• Automated capacitors

• Automated regulators

• Distribution circuit monitors or SCADA

• Distribution Management Systems 

(DMS)

• DMS integration with Advanced 

Metering Infrastructure

• Others

• CVR algorithms

• Load balancing

• Reconductoring

Key Build Metrics (Technologies)

• Distribution feeder load (hourly and/or 

average)

• Distribution power factor (hourly 

and/or average)

• Distribution losses (average/peak, % of 

load, or MWh for reporting period)

• Emissions reductions from energy 

savings

• Others

• Energy savings from CVR

Key Impact Metrics
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 18

Impact Analysis » Lower Losses › Benefits Logic

Analyzing the change in hourly circuit load can contribute to determining how 

much energy is saved by reducing distribution losses.

Energy Savings 

from Lower 

Losses

Hourly Circuit 

Load Data (MW, 

MVAR)

Determine 

Change in 

Losses

Determine 

Change in 

Distribution 

Circuit Load

Impact Metric

Benefit

Value of energy 

savings for 

utilities

Value of lower 

emissions for 

society

Analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 19

Impact Analysis » Lower Losses › Hourly Circuit Load Data

Many projects are reporting hourly circuit data for real and reactive power, 

and this data can be used to determine other parameters.

0

1000

2000

3000

4000

5000

6000

7000

P (kW) Q (kVAR)

Time P (kW) Q (kVAR)

1:00 AM 4298 1949

2:00 AM 4061 1542

3:00 AM 3284 1574

4:00 AM 3408 1277

5:00 AM 2896 1519

6:00 AM 2900 1200

7:00 AM 3185 1388

8:00 AM 3103 1476

9:00 AM 4006 1868

10:00 AM 3817 1884

11:00 AM 4351 1997

12:00 PM 4635 2323

1:00 PM 5129 2390

2:00 PM 5213 2673

3:00 PM 5517 2677

4:00 PM 5378 2478

5:00 PM 5400 2855

6:00 PM 5658 2986

7:00 PM 5720 2638

8:00 PM 5643 2922

9:00 PM 5290 2664

10:00 PM 5346 2628

11:00 PM 5019 2496

12:00 AM 4801 2667

Real and reactive power for a day

Hourly Circuit 

Load Data (MW, 

MVAR)

Determine 

Change in 

Distribution 

Circuit Load

Source: Illustrative results from Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 20

Impact Analysis » Lower Losses › The Meaning of Line Losses

Energy is wasted as electricity flows through distribution lines. This wasted 

energy is known as “line losses”.

Conductor (Resistance, RL)

Modern overhead distribution 

conductor is typically made of stranded 

aluminum wire, sometimes with a steel 

reinforcing core.

The resistance (RL) of the conductor is 

about 0.3 ohms per mile, and 

decreases with cross sectional area.

As line current flows through the 

conductor, its resistance dissipates 

power in the form of “line losses”.

IL = Line Current

watts 2

line losses L RL P = I

Higher line current means higher 

line losses, and vice versa

Energy Savings 

from Lower 

Losses

Determine 

Change in 

Losses
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 21

Impact Analysis » Lower Losses › Calculation of Energy Savings from P/Q Data

Hourly data for real and reactive power will determine hourly line losses, and 

the difference between baseline and impact losses yields energy savings.

Some projects will be reporting hourly circuit load data for 

real (P) and reactive (Q) power. Using this information we 

will calculate hourly values for apparent power (S3θ) and 

power factor, and then calculate hourly line current (IL):

S = Apparent Power (VA)

P = Real Power (W)

θ = Phase Angle

Q = Reactive Power (VAR)

volt amperes

2

3

2 S3θ = P3θ +Q θ −

θ

θ θ

3

1 3 power factor cos ( ) S

P = = −

amperes

3

3

LL

L V

S I θ =

With IL and an assumption of distribution conductor 

resistance (RL), we calculate hourly line losses (Pline losses):

watts 2

line losses L RL P = I

watt-hours

4380

1

4380

1

∑ ∑ = =

= −

n

project

n

Energy Savings Pbaseline P

For each six-month reporting period (4380 hours) the total 

line losses per circuit or circuit group are:

Energy Savings 

from Lower 

Losses

Determine 

Change in 

Losses
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 22

Impact Analysis » Lower Losses › Value of Benefits

The energy savings from lower distribution losses saves utilities money on 

wholesale energy, and reduces carbon emissions and their potential cost.

Value of energy 

savings for 

utilities

Value of lower 

emissions for 

society

Value($) = Energy Savings(MWh)×Wholesale Energy Cost($/MWh)

( )

( ) ton Value CO Emissions tons CO Cost

MWh

tons CO Emissions tons Energy Savings MWh CO EmissionsFactor

$ ($) ( )

( ) ( )

2 2

2 2

= ×

= ×

Energy Savings 

from Lower 

Losses
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 23

Reported hourly data for real and reactive power

(four days in July)

Impact Analysis » Lower Losses › Example Analysis – Hourly P/Q Data

This project is seeking to improve distribution circuit voltage regulation and 

reduce losses.

Source: Illustrative results from Navigant analysis

Distribution automation project 

implementing better voltage 

regulation to improve power 

quality and reduce losses. This 

includes the coordinated 

operation of a voltage regulator 

with a transformer load-tap 

changer at a substation.
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 24

Impact Analysis » Lower Losses › Example Analysis – Calculation of Losses Savings

This project was able to reduce line losses by about one percent over a year.

SELECTED DATA (Jan 1 – Dec 31) FULL YEAR DATA (Same)

Baseline New Change Baseline New Change

Usage Energy 35712.1 35524.1 MWh -0.5% 35712.1 35524.1 MWh -0.5%

Reactive Power 17111.8 17094.5 MVARh -0.1% 17111.8 17094.5 MVARh -0.1%

Apparent Power 39654.8 39462.0 MVAh -0.5% 39654.8 39462.0 MVAh -0.5%

Avg Power Factor 0.904 0.903 0.0% 0.904 0.903 0.0%

Avg Current 209.0 208.0 A -0.5% 209.0 208.0 A -0.5%

Total Power Losses 1207.66 1195.50 MWh -1.0% 1207.7 1195.5 MWh -1.0%

Source: Illustrative results from Navigant analysis

Greatest savings 

happening at peak load
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 25

Impact Analysis » Lower Losses › Example Analysis – Calculation of Monetary Value

Assuming average wholesale prices and a cost for CO2 emissions, the value of 

reducing losses by one percent is about $840 per year.

$158 per circuit, per year 2000( / )

20($ / ) ($) 1.3( / ) 12,160( )

Assuming1.3 lbs/kWh for electricity generation and a price for CO emissions of $20 per ton

($) $680 per circuit, per year

($) (1207.66 1195.50) 56($ / )

At average wholesale market price of $56 per MWh

($) ( ) ($ / )

2

= × × =

=

= − ×

= ×

lb ton

ton Value lbs kWh kWh

Value

Value MWh MWh

Value Energy Savings MWh Wholesale Energy Cost MWh
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 26

Impact Analysis » Savings from CVR › Benefits Logic

We will work closely with projects implementing CVR to determine how its 

implementation creates energy and capacity savings.

Energy and 

Capacity 

Savings from 

CVR On

Hourly Circuit 

Load Data (MW, 

MVAR)

Determine 

Change in 

Circuit Load 

from CVR

Impact Metric

Benefit

Analysis

Energy and 

Capacity CVR 

Factors

Value of energy 

and capacity 

savings for 

utilities

Value of lower 

emissions for 

society

Value of 

electricity 

savings for 

customers

CVR Information

from Projects
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 27

Impact Analysis » Savings from CVR › The Meaning of CVR

Conservation voltage reduction (CVR) reduces customer voltages along a 

distribution circuit to reduce electricity demand and energy consumption.

Studies dating back to the 1980s 

have shown that small reductions in 

distribution voltage can reduce 

electricity demand from customer 

equipment and save energy. This 

has become known as “conservation 

voltage reduction (CVR)”.

Recent utility pilot programs have 

demonstrated that lowering 

distribution voltage by 1% can 

reduce demand and energy 

consumption by 1% or more.

“CVR-on” voltage profile

Voltage reduced 

by adjusting the 

LTC set-point

Distance along circuit

Customer Voltage

Distribution Source Voltage

“CVR-off” voltage profile

Energy and 

Capacity CVR 

Factors
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 28

Impact Analysis » Savings from CVR › Correlating CVR Results with Technology Configurations

By analyzing hourly load data and talking with utilities, we will try to correlate 

CVR factors with VVC technology configurations.

CVR reduces demand during

peak load periods

Illustrative

Peak demand reduced

Some projects who are pursuing CVR will be 

reporting hourly circuit load data. By analyzing this 

data we hope to determine how much demand and 

energy savings each project achieves with its 

technology configuration.

volt

watts

V

P CVRf ∆∆

=

CVR Factor (CVRf)

We will work with project teams in the focus group 

to understand how much distribution voltage was 

reduced to achieve the reduction in load.

Source: Illustrative results from Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 29

Impact Analysis » Savings from CVR › Value of Benefits

The energy savings from CVR saves utilities and their customers money on 

energy and capacity, and reduces carbon emissions.

Value of lower 

emissions for 

society

($) ( ) ($/ )

($) ( ) ($/ )

Value Capacity Savings MW Wholesale Capacity Cost MW

Value Energy Savings MWh Wholesale Energy Cost MWh

= ×

= ×

( )

( ) ton Value CO Emissions tons CO Cost

MWh

tons CO Emissions tons Energy Savings MWh CO EmissionsFactor

$ ($) ( )

( ) ( )

2 2

2 2

= ×

= ×

Energy and 

Capacity 

Savings from 

CVR On

Value of energy 

and capacity 

savings for 

utilities

Value of 

electricity 

savings for 

customers

Value($) = Electricity Savings(kWh)× Average Electricity Cost($/ kWh)
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 30

Reported hourly data for real and reactive power

(four peak demand days in July)

Impact Analysis » Savings from CVR › Example Analysis – Hourly P/Q Data

This project is seeking to reduce system peak demand with conservation 

voltage reduction during the summer.

Distribution automation project 

implementing conservation 

voltage reduction including the 

coordinated control of a 

capacitor bank with a 

transformer load-tap changer at 

a substation.

The CVR action was taken as a 

way to reduce system peak 

demand during high load 

periods in July and August.

Source: Illustrative results from Navigant analysis
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 31

Impact Analysis » Savings from CVR › Example Analysis – Calculation of Capacity Savings

This project achieved about a 2% reduction in demand by performing CVR 

during a peak period in July.

SELECTED DATA (July 1-4, 3PM-9PM)

Baseline New Change

Usage Energy 5.841 5.770 MW -1.2%

Reactive Power 3.092 2.891 MVAR -6.5%

Apparent Power 6.610 6.456 MVA -2.3%

Avg Power Factor 0.887 0.896 1.0%

Avg Current 304.6 295.4 A -3.0%

Total Power Losses 280.2 267.1 kW -4.7%

Source: Illustrative results from Navigant analysis

Peak load reduction
Voltage and VAR Control Impact Analysis Approach, 11-30-2011 32

Impact Analysis » Savings from CVR › Example Analysis

Assuming peak wholesale prices the capacity value of CVR is worth over 

$15,000 per year, per circuit.

Value circuit circuits about million per year

Value MW kW yr per year per circuit

Value Capacity Savings MW Wholesale Capacity Cost MW

($) 15,400 ($ / ) 500 $8

Assuming a large utility implements CVR on 25% of its 2000 circuits

($) (6.610 - 6.456) 100 ($ / ) $15,400 ,

At peak wholesale prices

($) ( ) ($ / )

= × =

= × − =

= ×