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usually an option for these two classes. In addition, the industrial customer may have choices of interruptible and standby rates and may even have the option of selling the utility electricity if the customer is a cogenerator. It is very important that the analyst consider the appropdate rates and effects that any investment may have on the customer’s consumption pattern. Given an analysis associated with a well-defined specific investment (electricity usage patterns before and after the investment is made are known and the investment is made in a specific utility’s service area in which the appropriate rates are known), the analystshouldusetheappropriateelectricityratesandusagepatternsofthecustomer. Theactualchange in usage patterns due to the investment may in some cases be difficult to arrive ate For example, the reduced nameplate capacity of a new, more energy-efficient appliance does not necessarily translate into an equal reduction in the investor’s peak demand. In this case, it is appropriate to perform a sensitivity analysis, varying the impact of the investment on the investor’s electricity usage. Given a nonspecific or generic analysis, it may be more difficult to perform an analysis incorporating utilityratestructuresbecauseratestructuresvarysignificantlyamongutilities. Inthesenonspecificcases, the analyst may have no choice other than to use an average cents per kWh figure for the price of electricity. The Edison Electric Institute (EEI) publishes an annual report called Statisticd Yearbook of the Electric Utility Industry (1991) in which average electricity prices (cents per kWh) are given for residential,commercial,andindustrialcustomersbystateandregion,andforthenation. Wheneveran average cents per kWh figure is used in an analysis, it should be noted that no distinction is being made between capacity and energy through the use of such an average rate. Most residential rates do not include demand charges; thus, the cents per kWh figures found in the EEI yearbook will provide good approximations for use when the analysis is directed to the residential class. On the other hand, most commercial and industrial rates include demand charges, and use of the EEI cents per kWh figures may skew the results of the analysis. The problem associated with using these figures is that they do not account for usage pattern changes in demand. For example, a commercial cool storage investment may shift a customer’s peak demand usage while maintaining the same total kWh usage. Therefore, using a cents per kWh figure as the proxy for the electricity bill would show no change in the customer’s bill after installing the cool storage system. If the technology being analyzed leads to changes i n the time of electricity use for a generic industrial or commercial customer, the implications of this usage pattern change should be investigated through a sensitivity analysis. The impact of the change should be assessed by varying both the change in size and/or timing of peak demands, as well as by varying the rate structures and rates associated with energy anddemandchanges. Forexample,theeffectsofreplacingacommercialchillerwithamoreefficientunit having electrical requirements 5 kW lower than its predecessor should be analyzed over a range of impacts on the commercial establishment’s peak load (the high end of the range being 5 kW) and over a range of demand charges per kW representative of the utilities’ rate structures in the region(s) of interest. 82PDF Image | A Manual for the Economic Evaluation of Energy Efficiency and Renewable Energy Technologies
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