What are Distributed Energy Resources Worth?

The valuation of Distributed Energy Resources (DER) is a complex, sometimes contentious, topic that generates a lot of trade press in the electric power industry. Utilities and regulators are seeking information about how to value the benefits and costs of DER to investigate whether DER can serve in place of traditional infrastructure investments and whether aligning incentives, payments, and rates with the cost and benefits of DER can send the appropriate market signals to yield results that guide DER deployment to places of highest value on the grid. This briefing presents the various dimensions of DER valuation (with a particular focus on locational value), current efforts to employ these valuation methodologies, and the implications for utilities and regulators.

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Vazken Kassakhian

Research Analyst
Smart Electric Power Alliance