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Project 2.1 Cost-benefits framework – S econdary Benefits and Ancillary Services

Project 2.1 Cost-benefits framework – S econdary Benefits and Ancillary Services Dr. Géza Joós Student: Greg Morris McGill University. Introduction. Project provides a framework for comparing the costs and benefits of Smart Microgrids .

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Project 2.1 Cost-benefits framework – S econdary Benefits and Ancillary Services

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  1. Project 2.1 Cost-benefits framework – Secondary Benefits and Ancillary Services Dr. GézaJoós Student: Greg Morris McGill University

  2. Introduction • Project provides a framework for comparing the costs and benefits of Smart Microgrids. • Microgrid brings new functionality to a distribution network. • This has many potential benefits... • But it also has costs. • Who does the Microgrid benefit and by how much? • Need to know this to build business cases and get buy-in from all affected parties.

  3. Impacts vs. Benefits • Impacts • The system changes that result from the Microgrid. • Can range from technical to economic to social or environmental. • Benefits • The economic gain that results from impacts. • Much more limited in scope than impacts. • Distinction gives clarity and allows a modular approach. • Additional considerations can be easily included.

  4. Stakeholders All entities affected by the Microgrid, including: • Microgrid Developer or IPP • Microgrid Customers (μGCs) • Grid Customers outside Microgrid (GCs) • Distribution Network Operator (DNO) • Utilities or Bulk Energy Suppliers (BESs) • Society

  5. Traditional View of Benefits • Technical • Increased power quality and reliability (PQR) • Reduction in losses • Efficiency improvements • Economic • Optimization of resources • Provision of ancillary services • Environmental/Social • Emissions reductions • Creation of employment? • Reduced reliance on depleting resources?

  6. A Different Perspective • μGCs benefit from energy cost reductions and PQR improvements. • GCs benefit from PQR improvements. • IPPs benefit from sales profits incl. ancillary services. • DNOs benefit from reduced O&M, reduced energy costs, and reduced PQR costs. • BESs may benefit from reduced O&M. • Society benefits from positive externalities, e.g. reduced emissions.

  7. Benefit Functions • Map from one set to another set like mathematical functions. • Map Microgrid impacts onto Stakeholder benefits. • E.g. • Reduced Electricity Purchased Cost • Investment Deferral • Reduced Emissions • Ancillary Services Provision • Reliability Improvement

  8. Impacts • The changes that are expected to result from the Microgrid. • Some must be known a priori, called “known impacts”. • Some must be calculated or simulated, “discovered impacts”.

  9. An Overview of the Framework

  10. Ongoing and Future Work • Comparison methodology is nearing completion. • Ancillary service valuation is in the early stages. • Collecting data for case studies. • Ideally based on Canadian Microgrids.

  11. Thank you! For further information contact gregory.weyrichmorris@mail.mcgill.ca

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