Valuing Distributed Energy Resources: Combined Heat and Power and the Modern Grid

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In this paper we examine how decision makers can more precisely assess the costs of disruptive weather events and the value of resilient distributed energy systems such as combined heat and power (CHP). CHP makes up a small percentage of the energy infrastructure in the United States despite its substantial efficiency and resilience benefits. In part this is because the resilience value of CHP is not fully accounted for in energy infrastructure project cost screenings. To capture this benefit in investment decisions, we propose a framework for a metric called the Distributed Energy Resource Resiliency Value (DERRV) and discuss how such a metric might be applied to CHP.

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