Distributed Generation with Heat Recovery and Storage

Abstract

Electricity produced by distributed energy resources (DER) located close to end-use loads has the potential to meet consumer requirements more efficiently than the existing centralized grid. Installation of DER allows consumers to circumvent the costs associated with transmission congestion and other nonenergy costs of electricity delivery and potentially to take advantage of market opportunities to purchase energy when attractive. On-site, single-cycle thermal power generation is typically less efficient than central station generation, but by avoiding nonfuel costs of grid power and by utilizing combined heat and power applications, i.e., recovering heat from small-scale on-site thermal generation to displace fuel purchases, DER can become attractive to a strictly cost-minimizing consumer. In previous efforts, the decisions facing typical commercial consumers have been addressed using a mixed-integer linear program, the DER customer adoption model (DER-CAM). Given the site’s energy loads, utility tariff structure, and information (both technical and financial) on candidate DER technologies, DER-CAM minimizes the overall energy cost for a test year by selecting the units to install and determining their hourly operating schedules. In this paper, the capabilities of DER-CAM are enhanced by the inclusion of the option to store recovered low-grade heat. By being able to keep an inventory of heat for use in subsequent periods, sites are able to lower costs even further by reducing lucrative peak-shaving generation, while relying on storage to meet heat loads. This and other effects of storage are demonstrated by analysis of five typical commercial buildings in San Francisco, California, in the United States, and an estimate of the cost per unit capacity of heat storage is calculated.