Energy Reduction Assets

Why Is the Solar (Thermal) Water Heating Industry So Small?

Nov17
2011 2 Comments Written by Corey Benson
SDHW

Americans need electricity and hot water in their homes. By using the sun’s energy, homeowners and businesses can generate a substantial percentage of their electricity (solar PV) and hot water (solar domestic hot water) without producing carbon dioxide emissions. Investing in either solar technology can be profitable in many locations (with the help of generous utility and government rebate and tax incentive programs).

However, the U.S. solar photovoltaic (PV) industry currently dwarfs the solar (thermal) water heater industry, despite the fact that solar (thermal) water heaters provide a substantially more profitable investment (shorter payback, higher return-on-investment), require less roof space, and require about 1/3 of the upfront cost as compared to solar PV. The massive uptake of solar PV in the residential sector over the past few years, and the third-party financing options that have promoted this growth, have not been materialized in the solar hot water heating industry.

What factors explain the disconnect between favorable economics and comparatively low levels of market activity in the solar domestic hot water heating industry?

Posted in Energy Reduction Assets, Renewable Energy - Tagged , , , , , , ,

Scientist skeptical of global warming science performs study and finds…global warming

Oct28
2011 Leave a Comment Written by Humphrey Wong

Dr. Richard Muller, a physicist at UC Berkeley and a skeptic on some of the science of global warming, used new analytical techniques to re-examine climate data and found that the evidence supported the existence of global warming. Dr. Muller published an article in the Wall Street Journal on October 21, 2011 titled, “The Case Against Global-Warming Skepticism,” describing his conclusions after a 2-year study. He stated that “When we began our study, we felt that skeptics had raised legitimate issues, and we didn’t know what we’d find. Our results turned out to be close to those published by prior groups. We think that means that those groups had truly been very careful in their work, despite their inability to convince some skeptics of that[1].” In other words, he concluded that the previously published data showed clear evidence for global warming, and that climate scientists had not made mistakes in their analyses.

Dr. Muller started the study in the aftermath of “ClimateGate”, in which the hacked emails of several scientists prominent for their work in climate change were interpreted by many, particularly climate change skeptics, as evidence that some scientists were committing fraud in support of the theory of climate change. However, several investigations into the work of the hacked scientists found “no evidence of fraud or scientific misconduct[2].” Dr. Muller’s work was based on criticism of the analyses of the data and not upon critiques of the scientists themselves. The Berkeley Earth Surface Temperature Project is a group that was founded and chaired by Dr. Muller. It consists of several other physicists, statistical scientists, and a climatologist. The group used new analytical techniques on the previously gathered data to see if the claims about the size of global warming were justified. The group found that they were. It should be noted, as it was in the Wall Street Journal article, that their study did not address whether the warming was human-caused, but only whether global warming was taking place.

We at Joule Assets believe that energy policy that addresses the possible effects of global warming and climate change needs to be based on the best science possible. With this latest news, the consensus about the science behind global warming appears to be growing stronger.

Papers on the Berkeley Earth Surface Temperature Project’s findings have been submitted for peer review and can be found online at the Project’s website:  www.BerkeleyEarth.org.


[1] Richard Muller, “The Case Against Global-Warming Skepticism,” Wall Street Journal, October 21, 2011. http://online.wsj.com/article/SB10001424052970204422404576594872796327348.html#articleTabs%3Darticle

[2] Wikipedia entry, “Climatic Research Unit  email controversy”, http://en.wikipedia.org/wiki/Climatic_Research_Unit_email_controversy

Posted in climate change, News - Tagged , ,

Assessing Risks in Solar Investment

Oct27
2011 Leave a Comment Written by Corey Benson

This is a must-read for anyone who is interested in investing in solar PV.

The spectacular growth of the solar PV industry, 67% in 2010, is the product of falling technology costs and generous rebate, incentive, and tax credit opportunities. Without rebates, incentives, and tax credits, installing solar PV would not be profitable. In light of the current economics of the solar industry, would-be solar customers may forgo solar investment opportunities because they fear that the financial support from rebates, incentives, and tax credits is uncertain and/or subject to regulatory change. This blog posts examines the regulatory risks of the different revenue opportunities (rebates, incentives, tax credits, utility bill savings) on which profitable solar PV investment relies.

Federal Tax Credit

Under current legislation, both individual taxpayers (26 USC § 25D) and businesses (26 USC § 48), are entitled to a 30% tax credit on the installed cost of renewable energy technologies. These tax credits will remain in effect until December 31, 2016. The federal (income and corporate) tax credits are granted upon project completion. As such, taxpayers and corporations realize the entire revenue stream in the beginning of the solar lifecycle, making it a safe revenue stream.

Looking ahead, there is no indication that the U.S. government is considering repealing these tax credits. The United States government has invested billions of dollars in the US solar industry through tax credits, stimulus investment, and research and development.

Utility Bill Savings

Solar owners save money by replacing a portion of their utility-sourced electricity purchase with the production of their own (solar) electricity. The recurring savings associated with forgoing the purchase of utility-sourced electricity does not rely on legislation; this revenue stream is safe.

Utility Rebate Programs

Utility rebate programs are not all designed alike. However, because these programs pay the cash rebate at the beginning of the solar PV lifecycle (usually after the PV system is completed and operational), there are low levels of risk for the solar owner. Utility rebate programs have limited budgets, but they announce when their funding is fully subscribed. Interested customers should consult their utility before beginning the solar PV installation process. Through this consultation, customers can assure that rebate funding remains available.

Performance-Based Incentive Programs (Utility, State-Sponsored)

Performance-Based Incentives (PBIs), including feed-in tariffs, pay customers based on total solar electricity production. This revenue stream recurs annually. In the case of feed-in tariffs, the rate paid per kWh produced is guaranteed over the length of the feed-in tariff agreement (10-25 years). PBIs are a safe revenue stream because the rate paid is guaranteed for the full length of the feed-in tariff agreement.

Solar Renewable Energy Credit (SREC) Programs

SREC programs are similar to traditional PBIs insofar as they pay customers based on solar electricity production. In an SREC program, a customer earns an SREC for every megawatt-hour (MWh) of electricity his system produces. This SREC has a market value; it can be sold to utilities which are required by a state’s Renewable Portfolio Standard (RPS) to either build their own renewable energy facilities or buy SRECs from residential and business customers. Unlike traditional PBIs which guarantee a rate paid for all electricity produced over the PBI contract length (10-25 years), the value of SRECs can fluctuate substantially from year to year, depending on SREC supply and demand.

The potential for SREC price instability has been demonstrated in New Jersey’s SREC market. From 2005-2010, NJ SRECs had a value ranging between ~$500-$680. Such generous prices spurred New Jersey to become the nation’s 2nd largest state for solar PV installations (behind only California). However, solar PV market growth has now reached the point where the rate of SREC supply growth has substantially outpaced the rate of SREC demand growth; SREC demand growth is based on planned increases in a state’s RPS requirements. The New Jersey SREC market is now oversupplied and SREC prices have fallen accordingly. In September 2011, the value of a NJ SREC had dropped to $166.79, 19.3% of its 2010 value ($606.56).

To guard against price uncertainty, customers may enter into long-term contracts to sell their SRECs. Long-term SREC agreements allow customers to “lock-in” the value of their SRECs for more than one year. Customers interested in long-term SREC contracts must enter into an agreement with an SREC aggregator. Due to market uncertainty, long-term SREC agreements are currently limited to 5 years.

Conclusion

Apart from the revenues gained from the sale of SRECs, solar PV revenue streams are reliable and predictable. Fears of regulatory uncertainty are largely unfounded.

Individuals interested in pursuing solar PV installations in states with SREC programs can rely on Joule Assets to facilitate competitive SREC aggregation bidding; ensuring consumers receive the best prices possible.

Posted in Energy Reduction Assets, Renewable Energy - Tagged , , , , , , , , ,

DOW POWERHOUSE™ Solar Shingle Has Great Potential, But Questions Remain

Oct20
2011 3 Comments Written by Corey Benson

Earlier this month, the Dow Chemical Company announced it would introduce its DOW POWERHOUSE™ Solar Shingle in Colorado, with plans to expand to California and other profitable solar states in 2012. As both a traditional shingle used on an asphalt roof and a thin film solar photovoltaic panel, the DOW POWERHOUSE™ Solar Shingle represents a crossover technology between shelter and electricity production. Dow’s offering is not the first solar shingle ever created, but it is among the first solar shingles to receive Underwriter’s Laboratory (UL) safety certification (the solar industry standard for safety and reliability). By leveraging its financial, engineering and manufacturing resources, Dow Chemical aims to bring solar shingles into the housing mainstream. By 2015, Dow plans to be producing 220 MW annually, enough solar shingles for more than 73,000, 3-kW solar systems.

What’s the big deal?

Solar shingles offer better aesthetics than do traditional rack-mounted photovoltaic arrays because the shingles do not protrude from the roof, keeping the traditional roof line intact.

While the product was still under development in 2009, Jane Palmieri, the managing director of Dow Solar Solutions, claimed that the DOW POWERHOUSE™ Solar Shingle would be 10-15% cheaper than a standard solar-power rack. As with traditional rack-mounted solar photovoltaic systems, Dow’s product will qualify for rebates, incentives, and tax credits.

Availability

If you are remodeling your home or buying a new one, you will have to wait to get the DOW POWERHOUSE™ Solar Shingle installed on your rooftop. This month, the first 50 3-kW systems will be installed in Colorado. Large-scale manufacturing of the solar shingle is not slated to begin until late 2012, so availability will be strictly limited until then. More details on other market-specific launches in California and other profitable solar states should be available by the end of October.

What we still don’t know

Despite the positive buzz around Dow Chemical’s new solar shingle, there are a few important questions that remain to be answered. First, Dow’s claims that its product would be 15% cheaper than traditional solar photovoltaic panels were made in 2009. Since then, the installed cost of solar photovoltaic systems has dropped by as much as 25% in California and other major U.S. markets.

Also, the solar shingle’s technical specifications have not been made public. Without knowledge of key metrics such as efficiency, we cannot be sure of the true lifetime value of the DOW POWERHOUSE™ Solar Shingle. Until we know the price and efficiency of these new solar shingles, it’s unclear whether Dow Chemical’s new product will achieve mainstream success or remain a niche market for homeowners more concerned with aesthetics than maximizing revenue.

Dow Chemical has stated that it will release technical specifications in late 2011. Check back to the Joule Assets blog as the DOW POWERHOUSE™ Solar Shingle’s economic value becomes clearer in the months ahead.

Posted in Renewable Energy - Tagged , , , , , , , ,

Got Energy Reduction Assets? Energy Inflation Surges 19.7%

Oct20
2011 Leave a Comment Written by Corey Benson

The Consumer Price Index, the United States government’s key metric for measuring inflation, increased 3.9% in September as compared to last year’s level. The major contributor to this inflation is energy. The energy inflation index has increased 19.7% over the past 12 months.

Yesterday’s announcement is more evidence that everyone, from homeowners to corporations, would be well-served to reassess their energy use. Joule Assets suite of tools helps users identify cost-saving and revenue-creating opportunities in Energy Reduction Asset markets by controlling when they use energy (Demand Response), permanently reducing energy consumption (Energy Efficiency), and offsetting fossil-fuel based energy production (Renewable Energy).

There has never been a better time to participate in Energy Reduction Asset markets. Skyrocketing energy costs increase the value of participating in these markets.

Posted in Demand Response (DR), Energy Efficiency (EE), Energy Reduction Assets, Renewable Energy, Uncategorized - Tagged , , , , , , , ,

Scientists Protest: Claim Climate Change Removed from Texas Report

Oct18
2011 Leave a Comment Written by Humphrey Wong

The UK’s Guardian reports that a controversy has erupted around a new environmental report being published in Texas about the environmental future of Galveston Bay. Scientists are asking their names to be removed from a report that they say has been “doctored” to remove all references relating to climate change, which most climate scientists attribute to man-made production of carbon dioxide. Officials with the Texas Commission on Environmental Quality responded by saying that prior to their changes, the report was  ”inconsistent with current agency policy.”

You can see some of the changes in the report here, courtesy of a link provided by Don Shelby at MinnPost.com.

Joule Assets is committed to enabling end-users, engineering vendors, and other stakeholders to achieve the benefits of Energy Reduction Assets that either reduce or offset the use of carbon-based energy.  While it is expected that other considerations will always be included in setting public policy, it should be always based on the most accurate scientific reports available. Most people would agree that bending any report’s conclusions to suit a political agenda is ill-advised. Hopefully, both the scientists and the Texas officials will come to a resolution that prioritizes the public’s need to be accurately informed about what the future holds for Galveston Bay.

 

Posted in climate change, Energy Reduction Assets, News - Tagged , , , ,

Solar Financing – A Win-Win For Consumers and Industry

Oct11
2011 Leave a Comment Written by Corey Benson
Solar Money House

In the past, many consumers chose to forgo installing solar panels because of their high upfront cost. Upfront cost no longer serves as a barrier to solar entry. With the help of solar financing companies, homeowners and businesses can enjoy the benefits of solar technology for zero upfront cost while saving money on their electricity bills month after month. Sound impossible? It’s true.

This blog post will explain the considerations consumers should be aware of when considering a power purchase agreement, the most common solar financing option.

What is a Power Purchase Agreement?

A power purchase agreement (PPA) is an agreement between a homeowner or business owner and a solar financing company. In a PPA, the solar financing company agrees to pay for the installation of a solar system on/at a home or business; the homeowner or business owner agrees to pay the solar financing company for all electricity produced by the solar system. However, the solar financing company charges the customer at a rate (price) that is lower than the normal rate (price) of utility-sourced electricity. As such, the PPA offers homeowners and business owners an opportunity to save money on electricity costs.

The solar financing company has a financial incentive to enter a PPA as well. As part of the solar financing agreement, the homeowner or business owner agrees to sign over the rights to all rebates, incentives, tax credits for which she is eligible. By combining these cash flows, solar financing companies can make a profit and expand their business offering to more customers. 

Solar Financing Availability

Solar financing is available in at least 12 states: Arizona, California, Colorado, Hawaii, Maryland, Massachusetts, New Jersey, New York, Oregon, Ohio, Pennsylvania, Texas, and Washington D.C. As solar panel prices continue to decrease and legislation supporting renewable energy continues to develop, solar financing availability will expand to other states. Joule Asset’s suite of tools will connect you to solar financing companies.

Eligibility Issues

Joule Asset’s suite of tools will also make customers aware of eligibility rules governing the use of the use of rebates, incentives, and tax credits by solar financing companies. In general, larger utilities are likely to accept PPAs within the rules of their solar rebate and incentive programs. Homeowners are also entitled to pass on the 30% federal income tax credit to solar financing companies and business are entitled to pass on the 30% business tax credit. However, homeowners and business owners who receive their electricity from smaller municipal utilities and electric cooperatives may not be eligible to pass on associated rebates and incentives to solar financing companies, depending on location.

Extent of third party ownership

What began as a fledgling business model has now become big business. Solar financing companies have facilitated the dramatic growth of the U.S. solar industry. Today, solar financing is more important than ever before.

From April 2011 – June 2011, Xcel Energy’s Solar Rewards Program, the largest utility-funded solar rebate program in Colorado, has averaged 59.4% third-party ownership, i.e. solar systems financed by a third party, for residential installations.[1] According to PV Solar Report, June 2011 was the first month in which the majority of new residential solar installations participating in the California Solar Initiative (CSI), the largest solar rebate program in California, were third-party owned.[2] The commercial and industrial sectors have also used solar financing as a means of driving market growth. An average of 42% of all non-residential solar systems participating in the CSI in 2009 and 2010 were third-party owned.[3]

Installing a solar system on your home or business has never been easier or more economically attractive. Through access to solar financing, you can lower your utility bills while stimulating an industry that is vital to our nation’s economic and environmental vitality.

Future posts will comment on the favorable economics of solar thermal technology, the rebates/incentives available, and financing options for interested clients.

 

[1] GreenTech Media, “Third-Party-Owned Solar Dominates the California Market,” September 2011.

[2] Ibid.

[3] Ibid.

Posted in Energy Reduction Assets, Renewable Energy - Tagged , , , , , , , , ,

The Solar (Photovoltaic) Business Case

Oct07
2011 Leave a Comment Written by Corey Benson
The Solar (Photovoltaic) Business Case

In several states across the country installing solar (photovoltaic) panels is a profitable investment. Solar owners (individual homeowners, small businesses, and large corporations) have realized substantial profits through the combined benefit of sunny conditions, high electricity rates, and generous rebate, incentive, and tax credit availability.

Solar panels installed in sunny states like California and Arizona produce comparatively high levels of electricity for a comparatively small investment (more sun means fewer panels need to be installed). A previous post on solar technology titled “Investment in Solar Technology Hedges Against Electricity Inflation” explained the increasing economic value of offsetting electricity consumption with electricity produced from solar panels.

The positive economic impact of offsetting electricity consumption is most pronounced in sunny states with high electricity rates. As an example, California had an average residential electricity rate of $0.1509/kWh in 2010, approximately 30% higher than the national average of $0.1158/kWh.

Fortunately, a state need not be particularly sunny or have high electricity rates to contain the market conditions for profitable solar investment. Despite receiving approximately 30% less sun than the Southwest, New Jersey is a national leader in solar installations because of its generous solar renewable energy credit (SREC) program. Up until this year, when market conditions changed substantially, solar installations could receive approximately $0.60 per kWh of electricity generated. New Jersey’s SREC program is an example of a performance-based incentive (PBI).

In addition to PBIs, residential, commercial, and industrial customers may be eligible for upfront rebates from their electrical utility or state energy commission. Upfront rebates pay customers based on the size of the their solar (photovoltaic) system. As an example, Azusa (California) Light and Power’s solar rebate program reimburses its customers $275 for each kW of installed solar (photovoltaic) capacity. With average solar (photovoltaic) installation costs ranging from $6/W-$8/W, such an upfront rebate constitutes between 34.4%-45.8% of the total installed cost.

Individuals and businesses are also eligible for generous tax credits form the U.S. federal government. Taxpayers are eligible for a 30% federal income tax credit on the value of the solar equipment purchased (reducing the cost of the solar system by 30%). Corporations are eligible for a 30% corporate tax credit. Individuals and corporations can combine this tax credit with other rebates and incentive programs.

However, not all rebate and incentive programs for which a customer may be eligible can be combined. Joule Assets suite of tools will identify a client’s rebate, incentive, and tax eligibility (including which programs can be combined) and in so doing, optimize these cash flows for maximum profit.

Future posts on solar technology will discuss different solar financing options for homeowners and business owners alike.

Posted in Energy Reduction Assets, Renewable Energy - Tagged , , , , , , , , ,

Solyndra and the State of Solar

Sep26
2011 Leave a Comment Written by Corey Benson
Solyndra and the State of Solar

At Joule Assets we provide value to our customers with the most complete information available coupled with the nuanced guidance of industry leaders. September has been a tumultuous month for the U.S. solar industry with the bankruptcy of much heralded thin-film solar panel producer Solyndra and a pronounced industry-wide stock sell-off last week.

First, lets talk about Solyndra. Critics have pointed to the company’s bankruptcy as proof positive that renewable energy is not economically viable, the United States federal government has no business financing renewable energy or “picking winners,” and that the executives at Solyndra criminally mishandled their business and the federal government’s $535 million loan guarantee. In this post, we will only respond to the first major criticism, i.e. that Solyndra’s bankruptcy is a harbinger for the demise of the broader solar industry.

Why did Solyndra close its doors?

Solyndra went bankrupt because its expensive thin-film technology – which yielded less than disruptive efficiency gains – was unattractive to consumers at a time when solar PV panel prices are at an all-time low. Solyndra was a relatively small company in the solar industry; it produced less than 1.7% of U.S. manufactured thin film solar panels in 2009. Due to their lower conversion efficiencies, thin film solar panels accounted for less than 20% of total global production of solar PV panels in 2009.[1]

What are the prospects for the solar industry?

This past week witnessed a pronounced sell off in global stock markets and solar companies stocks were not spared. Nevertheless, the largest solar PV manufacturers exhibit strong financial strength, with increasing profit margins throughout the past two fiscal years. Despite the economic stagnation in the world’s largest consumer markets over the past 2-3 years, the global solar industry has continued to grow and profits have increased. Here is a look at four of the world’s largest solar PV manufacturers, ranked by market capitalization.

Company Name 2009 Profit Margin 2010 Profit Margin Market Capitalization
First Solar[2] 30.98% 25.91% $6.06B
SunPower[3] 18.6% 22.97% $912.07M
SunTech[4] 5.06% 8.19% $475.59M
Yingli[5] 4.39% 22.24% $158.9M

Three of the four companies listed increased their profit margins between 2009 and 2010. These positive signs for the solar industry extend into employment data, as well. In the past year, solar industry employment in the United States has grown 6.8%,[6] while the rest of the economy struggles to add jobs.

Sustained and dramatic solar PV price decreases have propelled the solar industry’s recent success. In the United States, the capacity-weighted average installation cost of solar PV has fallen from $9.90/watt in 2002 to just over $6.20/watt in 2010.[7] Between 2009 and 2010 prices declined 17.3%.[8] This trend has continued into 2011; in the first half of 2011, the capacity-weighted average installation cost of solar PV systems participating in the California Solar Initiative[9] has fallen an additional 10.9%, compared to 2010 prices.[10]

What are the implications for consumers?

Now is a great time to be considering solar PV. Dramatic reductions in price over the past 2 years have made solar more affordable than ever. The secular trend of price reductions will continue into the future, ultimately making solar rebate, incentive, and tax credit programs unnecessary for solar profitability; this moment is called “grid parity.”

There may be continued shake-out of high cost, low margin producers, but the solar industry’s long term prospects are still favorable. Solyndra’s bankruptcy was an opportunity for political theater, but it does not speak to the underlying prospects for the solar industry.

[1] Renewable Energy World, “Top 10: Ten Largest Solar PV Companies,” June 2010.

[2] First Solar, “First Solar – Annual Report 2010,” February 2011, p. 40.

[3] SunPower, “Sun Power – Annual Report 2010,” February 2011, p. 50.

[4] SunTech, “SunTech – Annual Report 2010,” February 2011, p. 3.

[5] Yingli, “Yingli – Annual Report 2010,” February 2011, p. 2.

[6]  Renewable Energy World, “And Now the GOOD Solar News: 6.8% Solar Job Growth Since August 2010,” September 2011.

[7] Lawrence Berkeley National Laboratory, “Tracking the Sun IV: The Installed cost of Photovoltaics in the U.S. from 1998-2010,” September 2011.

[8] Ibid.

[9] The California Solar Initiative is the United States largest solar PV incentive program.

[10] Ibid.

Posted in Renewable Energy - Tagged , , , , , ,

DR Providers Protest NYISO Filing on DR Compensation

Sep21
2011 Leave a Comment Written by Humphrey Wong

Demand Response Providers Protest NYISO Filing on DR Compensation

On September 9, several Demand Response (DR) providers filed a protest over the New York Independent System Operator’s (NYISO’s) filing complying with the Federal Energy Regulatory Commission’s (FERC) Order 745 on Demand Response compensation. [Thanks to Aaron Breidenbaugh of EnerNOC for the link to the filing by the DR Supporters: http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=12761024]

The providers (collectively called “Demand Response Supporters” in the filing) consisted of Comverge, Inc., Demand Response Partners, EnergyConnect by Johnson Controls, Inc., Energy Curtailment Specialists, Inc., Energy Spectrum, Inc., EnerNOC, Inc., Wal-Mart Stores, Inc., and Viridity Energy, Inc.

They described 4 major objections:

1)      The NYISO’s M&V proposals were believed to be deficient. The DR Supporters wanted to require all M&V protocols to be included directly in the tariff in order to avoid ambiguities or misinterpretations; they wanted FERC to reject a “cap” that was placed on the amount by which a customer’s baseline could be adjusted (an “in-day adjustment”) in order to take into account atypical weather; finally, they wanted FERC to confirm NYISO’s ability to accept alternative methods for calculating the customer baseline.

2)      The DR Supporters believed that NYISO should not be allowed to exclude compensation for DR that was facilitated by Behind-the-Meter-Generation. They believe that compensation for DR should be based solely on metered consumption of power from the grid, and that what happens behind the meter to reduce consumption is beyond the NYISO’s jurisdiction. They also cited the fact that both PJM and ISO-New England—adjoining RTOs to the NYISO—make no similar exclusion.

3)      The DR Supporters also believed that the penalty rate charged for over or under deliveries of Demand Response was excessive because it was specified as being the greater of the day ahead rate or the real time rate. They preferred that the penalty simply be the real time rate.

4)      Finally, the Supporters protested that the NYISO had proposed a net benefits calculation which would produce an “unreasonably high net benefits threshold,” and thus DR would be excluded from compensation for an unnecessarily high number of hours. This was because the NYISO had proposed leaving out of the calculation those hours having lower locational marginal prices (LMPs), during which demand response was unlikely to participate. According to the DR Supporters, this would bias the threshold price toward higher values. They also cited other ISOs–PJM, the Midwest ISO (MISO), and ISO-New England—as having included all hours in their proposed calculations.

Keep coming back to Joule Assets for the latest developments in how DR is compensated!

Posted in Uncategorized
« Older Entries