Multi-Method DER Modeling

Multi-Method Decision Modeling of
Distributed Energy Resource Impacts on
Electric Distribution Grids
PRESENTED TO:
MAY 7, 2019

©2018-2019. LUMIDYNE CONSULTING LLC. ALL RIGHTS RESERVED
Introductions
Cory Welch
Founder & President
James Milford
Director of Technology
Lumidyne staff have been developing sophisticated energy-focused
planning models for electric & gas utilities throughout North America for
over a decade.
Domain expertise in energy efficiency, solar PV, storage, demand
response, & electric vehicle modeling
• Skills include System Dynamics, technology diffusion, linear & nonlinear
optimization, uncertainty & risk (Monte Carlo analysis), techno-economic
analysis, cost-effectiveness, integrated resource planning, custom decision
tool development

Services
SIMULATING DISTRIBUTED ENERGY
RESOURCE ADOPTION
The Distributed Energy Resource (DER) market
is evolving quickly, and the pace of change is
accelerating. We help you understand where
it’s headed – over time and spatially. We can
accurately assess the economics of and
forecast market adoption of distributed
energy resources, including rooftop solar
photovoltaics, battery storage, electric
vehicles, and energy efficiency resources. We
offer industry-leading approaches and
unparalleled accuracy in our forecasts, taking
the guesswork out of understanding the
future of these markets.
SYSTEM DYNAMICS MODELING
We live in a complex world – one that is ill-
suited to overly simplistic solutions. We have
15 years of experience applying the System
Dynamics methodology – an approach
conceived and cultivated in the halls of MIT –
to simulate the behavior of complex systems.
The models our staff have developed have
been used in dozens of client engagements
with some of the largest electric utilities,
regulatory agencies, and conservation
organizations in North America. Incorporation
of relevant feedback loops, stocks and flows in
our models is enhanced by our ability to
integrate these models with linear or
nonlinear optimization and Monte Carlo
analysis – making our approach second to
none.
DECISION SUPPORT TOOLS –
TAILOR-MADE FOR YOU
Most business decision tools are woefully
inadequate for the challenges you face. With
the Analytica® software platform, we can take
you light-years beyond what you could ever
accomplish with spreadsheets or rigid, off-the-
shelf solutions – improving capability,
flexibility and transparency. We can provide
you with customized decision support and
modeling tools that will give you more
capability than you ever thought possible,
improving your ability to make smart decisions
and investments.
SERVICES

Our staff have worked with
dozens of North American
utilities and agencies to
deliver modeling services
across a wide spectrum of
energy issues.
Capacity Expansion Production Cost Modeling Potential Studies
Generation, transmission, and
DSM resource acquisition
integrated with Monte Carlo
uncertainty and linear and
nonlinear optimization.
Renewable energy penetration
studies in Western US, benefits
of thermal storage from
concentrating solar power, and
impacts of emissions
regulations on Eastern US coal
plants.
Estimation of technical,
economic and achievable
savings potential from energy
efficiency, demand response,
codes & standards, and
electrification programs.
DER Adoption Forecasting Battery Storage Analysis Cost Effectiveness Stakeholder Engagement
Modeling customer behavior
and technology diffusion
dynamics to forecast adoption
of solar PV, battery storage,
electric vehicles, EE, and DR
over time and spatially.
Optimized charging/discharging
of stand-alone battery, battery
plus solar, and thermal storage
to maximize economic benefit
& calculate energy & demand
impacts.
Benefit-cost analysis using
industry standard and utility-
specific protocols across a wide
range of applications: EE, DR,
solar PV, thermal and electric
storage, grid modernization,
EVs.
Facilitated stakeholder
engagement activities involving
utilities, commissions,
customer and industry groups,
research and environmental
organizations, advisory
committees, & expert
testimony.
Clients for which staff have delivered relevant modeling services: APS, Arkansas Utilities, BC Utilities, BPA, CEC, CPUC, DOE, EPA, Enbridge,
Entergy NO, Exelon, HECO, IESO Ontario, KCP&L, LADWP, NV Energy, PECO, PG&E, PSEG, SDGE, UniSource, US Auto Alliance, Xcel CO, etc.
Experience and Qualifications

DER Planning Regulatory Environment
DER cost declines & favorable regulatory
environments are contributing to rapid growth in
these technologies
Proactively planning for DERs and
understanding their likely impacts is becoming
increasingly important to utilities
Several states are requiring utilities to integrate
DERs into their distribution planning process, such
as:
• California: via rulemaking 14-08-013 (February
2017)
• Nevada: PUCN proposed ruling (July 2018) SB 146
• Minnesota: Docket Number E-002/CI-18-251
(August 2018)
Others jurisdictions expected to follow suit as
DERs inevitably grow
https://sepapower.org/resource/2019-grid-integration-insights

DER Planning Model

TotalUnitsPurchased
UnitsperYear
Time
Incremental Adoption (Units/Year)
Cumulative Adoption (Total Units)
Inflection
Point
Source: Lumidyne
Bass diffusion1 and System Dynamics2,3 provide the tools needed
to assess distributed solar PV adoption under different scenarios.
Stock/Flow Diagram Prototypical S-Shaped
Adoption Curve
Source: Lumidyne
1. Bass, F. (1969). A New Product Growth for Model Consumer Durables. Management Science, 15(5), 215-227.
Retrieved from http://www.jstor.org/stable/2628128
2. Sterman. J (2000). “Business Dynamics: Systems Thinking and Modeling for a Complex World.” McGraw-Hill. New
York, NY. Page 332
3. Welch, C. (2017). "Making the Case for Using Analytica for System Dynamics Modeling: A Reference Guide and
Comparison with Classical Platforms." Peer reviewed paper presented at the International System Dynamics
Conference. Cambridge, MA..
Distributed Solar PV Diffusion Modeling

Distributed Solar PV Diffusion Modeling
Illustration of a Typical Calibration (Incremental
and Cumulative PV System Installs)
Source: Lumidyne
Historical PV interconnection data calibrated with nonlinear
optimization enables robust, accurate spatial disaggregation (e.g.,
substation or ZIP Code) of forecasts & grid impacts.
Spatial (ZIP) Disaggregation
Calibration of diffusion parameters to historical time-series
adoption data is critical to ensuring forecast accuracy.
Calibration of diffusion parameters to historical time-series
adoption data is critical to ensuring forecast accuracy.

Battery Storage
Mixed-integer programing
enables simulating storage
economics & hourly impacts for
any rate structure
Similar diffusion modeling
techniques as PV/EVs enable
adoption forecasting & grid impact
calculation
Integrated approach accounts
for retrofit of installed PV systems
& new combined (PV + storage) or
storage-only systems
Illustrative Optimal Battery Dispatch
(residential customer)
Source: Lumidyne

Electric Vehicles
Sales & registration data enable
calibrating diffusion & stock turnover
by ZIP Code (allocating to circuits,
substations as needed)
Stock/Flow Diagram
Illustration of Calibration
EVs/yearTotalEVs
Simulated
Actual
Non-Electric
Vehicle Stock
Electric Vehicle
(EV) Stock
EV
Retirements
Non-EV
Retirements
Non-EV
Additions
EV Additions
Total
Retirements
+
+
EV Market Share
(New Sales)
EV Economic
Utility
EV Non-Economic
Utility
+ +
+
+
+
+
Fraction Familiar
with EVs
Fraction
Unfamiliar with
EVs Familiarization
Advertising
Strength
Familiarization
through Advertising
Viral Strength Familiarization
through Viral Effects
+
+
+
EV Market
Fraction
+
+
<Non-Electric
Vehicle
Stock>
-
-
+
+
Electricity
Rate for
Charging
($/kWh)
-
Tax Credits &
Incentives
+
+
<Fraction Familiar
with EVs>

Risk & Uncertainty
Monte Carlo simulation
enables estimating uncertainty &
risk of the DER portfolio
(including potential correlations)
An appropriate metric of the
distribution of net impact can be
selected (e.g., 90th or 10th %ile),
depending on the desired balance
between risk and cost.
Value at risk (e.g., CVaR90) for
the utility is another financial
metric
Illustrative Distributions of DERs & Net Impact
Spatial Distribution of DERs Can be Very Different
For Illustration Only.
Not Actual AZ Data

SPIDER Model Demonstration

Contacts
Cory Welch - Founder & President
lumidyneconsulting.com
cory.welch@lumidyneconsulting.com
720.984.5814
James Milford - Director of Technology
lumidyneconsulting.com
james.milford@lumidyneconsulting.com
303.548.8847

Multi-Method DER Modeling

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