NARUC releases report analyzing methods for quantifying the value of resilience

Published on April 29, 2019 by Kevin Randolph

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The National Association of Regulatory Utility Commissioners (NARUC), along with Converge Strategies LLC, recently released a report that reviews methodologies for quantifying the value of energy resilience, particularly as it relates to investments in distributed energy resources.

The Value of Resilience for Distributed Energy Resources: An Overview of Current Analytical Practices examines regulatory decision-making and non-regulatory cost-benefit analyses to determine if and how a value of resilience was calculated and applied.

“The declining costs and new capabilities of DERs have greatly contributed to their growth,” NARUC Center for Partnerships & Innovation Director Danielle Sass Byrnett said. “State policymakers are increasing interest in understanding how they could ensure that the resilience benefits of DERs are included as part of clean energy programs and grid modernization efforts. A key sticking point has been how to measure resilience.”

The researchers evaluated the methodologies using four criteria which included the method’s ease of use, scope of outputs, geographic scalability and power interruption duration analysis capability.

The report determined that some of the valuation methodologies examined may be useful in regulatory decision-making but that none of them met all four criteria and that no single method was capable of capturing all regulatory concerns regarding the resilience value of DERs.

The researchers examined recent cases, two in Maryland and one in Illinois, in which state policymakers considered requests to recover the costs of microgrid investments from ratepayers. The report also discusses several trends in regulatory approaches to resilience, including the lack of a standardized approach for determining value.

The U.S. Department of Energy Solar Energy Technologies Office, through the National Renewable Energy Laboratory as part of the Solar Energy Innovation Network, supported the report. Converge Strategies, LLC prepared the report.