Cost effective energy efficiency measures through distribution efficiency


By K.C. Fagen

An analytical team, working with 13 utilities in the Pacific Northwest, completed a three-year study of the energy efficiency potential from designing and operating a distribution system more efficiently and reducing the voltage to be within the lower half of the ANSI standards. They found that significant energy savings and demand reductions could be achieved using a variety of techniques for voltage reduction. Importantly, they found this could be done quite cost effectively, and without any adverse impact on customers.

The Distribution Efficiency Initiative (DEI) study, completed in December 2007, involved two independent projects with no customer overlap between them: the Load Research project, which focused on customer end-use and which included whole house meters, and the Pilot Demonstration project, which focused on the distribution feeder system. More than 30,000 customers were involved in the study with no reports of negative impacts related to the reduced voltage levels. The scope of the DEI project also developed tools to assist utilities in implementing cost effective system improvements, including software and a guidebook to help them determine the most efficient distribution delivery system.

The project team consisted of The Northwest Energy Efficiency Alliance (NEEA), R. W. Beck Inc., RLW Analytics, Auriga Inc., and Meter Smart, Inc.

Specific DEI study results
The results of the study showed conclusively that operating a utility distribution system in the lower half of the acceptable voltage range (120-114 V) can save energy, reduce demand, and reduce reactive power requirements. Specifically, the energy savings results are within expected values of 1-3% total energy reduction, 2-4% reduction in kW demand, and 4-10% reduction in kvar demand.

The industry accepted metric for energy response to delivered voltage is the conservation voltage regulation (CVR) factor, which is the percentage change in load resulting from a 1% reduction in voltage. A positive CVR factor value means that the reduction in voltage has resulted in energy savings. The average voltage reduction and the amount of energy saved in the two DEI studies, and the corresponding CVR factors, are shown in Table 1. The CVR factor for the Load Research was 0.57, and for the Pilot Demonstration project was 0.69. The relative precision of the CVR factors was 10%.

The DEI study also concluded that there were no adverse impacts on the 395 Load Research and approximately 30,000 Pilot Demonstration customers, a finding validated by a formal customer survey performed by Puget Sound Energy. Following three years of operation, and subsequent opportunities to identify areas of concern, there have been no reports of customer issues related to the operation of the distribution voltage in the lower half of the ANSI voltage range.

Computer model simulations showed that by performing selected system improvements, between 10-40% of the total energy savings occurs on the utility side of the meter. The project showed that potential energy savings of 1-3% that can be achieved by implementing various system substation and feeder improvements combined with controlling the voltage in the lower half of the ANSI standards. The economics are also very favourable at a cost of 0.1 to 0.5 cents per kWh saved over a 15-year period achieved by implementing these system improvements and operating the voltage in the 120 to 114 V range at the customer’s meter.

Energy savings table

1. Actual savings for DEI project (not annualised).
2. Based on random selection of residential sites, weighted to represent expected results for the Pacific Northwest Region.
3. Values are shown for the purpose of calculating the savings for project and do not represent expected values for the Pacific Northwest Region.
Table 1: Energy savings and conservation voltage reduction factors for the DEI projects

Methodologies of the DEI studies
To provide a measurable basis for comparison, the methodology of both studies involved regulating the voltage within the lower half of the industry accepted voltage range (as defined by ANSI C84.1) for 24 hours and then applying typical utility voltage for the next 24 hours – one day “ON” and one day “OFF” for a year – recording the electrical consumption for each 15-minute period. As a result, measured savings were roughly one-half of potential savings. The actual energy savings for the project was 8,563 MWh, which was just over 2% of the total energy delivered from the substations, or 1.88 average MW (8,563 MWh/number of hours ON). If the DEI projects were in operation full time (instead of every other day) the annualised savings would have been 16,490 MWh.

In the Load Research Project, customers were randomly selected from 11 different utilities, and a detailed in-home assessment was conducted to verify end-use load types (electric heating, electric water heating, air conditioning) and the customer’s usage patterns. A voltage regulator and utility grade recording meters were installed at residential customers’ houses for 395 random locations throughout the Pacific Northwest. The voltage regulator controlled the voltage at 115.6 V for 24 hours, and then switched over to the normal utility voltage for the next 24 hours, which averaged 120.8 V. The electric meter recorded the watts, reactive power, and voltage at 15 minute intervals and uploaded the data to Meter Smarts’ database each night. An analysis was performed on the data to determine the voltage reduction, energy savings, and reductions of peak kW and kvar.

The savings produced by the Load Research study were considerable. Overall, the home voltage regulation of the 395 meters included in this analysis saved 86,655 kWh from August 2005 to June 2007, or 219 kWh per home for the study. Assuming this sample data is representative of an average year, the annualised savings of home voltage regulation can be assumed to be 346 kWh per year per house in the Pacific Northwest, or a savings rate of 2.15% of total energy consumption.

In contrast, the Pilot Demonstration project worked with six different utilities to implement various efficiency methods at the distribution feeder level while controlling the voltage at the customer’s meter within the lower half of the ANSI voltage level. The voltage level at the distribution substation bus was set to the lower voltage for 24 hours, and then operated at a more typical voltage level for the next 24 hours. Demand for kW and kvar, and energy consumption were measured at the distribution feeder level. The project included 31 distribution feeders at 10 different substations for the duration of the study. In addition, 52 residential and 12 light commercial customers served by the pilot feeders were metered during the operation of the projects. The 64 metered customers had similar results as the overall pilot projects. An estimated 30,000 customers were affected by the Pilot Demonstration project.

The savings produced by the Pilot Demonstration project were also considerable. The CVR factor for energy ranged from 0.3 to 0.84 (%ΔE/%ΔV); the CVR factor for kW demand ranged from 0.17 to 1.12; and the CVR factor for demand kvar ranged from 1.99 to greater than 10. The resulting energy savings averaged just over 2%. In general the CVR factors for kvar were greater than kW and the CVR factors for kW were higher than for energy. The benefit to cost ratios ranged from 2:1 to 23:1 using net present value analysis over a 15-year life cycle period. The cost per kWh saved over the life cycle of 15-years ranged from 1.58 Mill to 20 Mill (1 Mill = 0.001$/kWh saved).

Software tools and guidebook
Software tools were developed to assist utilities in making informed business and technical decisions. The Distribution Efficiency Calculator software tools were developed in MS Excel using Visual Basic. They include a high level module for use by managers and a more detailed module developed for use by system planning engineers. The manager’s tool produces the estimated potential savings that can be achieved based on varying levels of voltage reduction. The planning engineer’s tool is used to determine which distribution efficiency methods (system improvements and voltage regulation) can be used to lower the distribution system operating voltage.

The software allows the system planner to enter information about a specific feeder in order to perform a simplified power flow model. System improvements and voltage regulation settings are then modeled for up to three improvement cases for the distribution feeder. Cost information is provided with the software tools but can be customised by the utility. The existing system and improvement cases can be calculated and the benefits compared to the costs. This allows the utility to determine which distribution efficiency methods are best suited for implementation.

A guidebook was also developed to help utilities refine their existing planning and design criteria, and to implement system-wide distribution efficiencies. The guidebook walks the user through each component of the electric distribution system, how it operates, and how the component impacts the system voltage. Guidelines are established for voltage drop on the primary conductors, distribution transformers, and secondary conductors such that the total voltage drop from the substation to the customer’s meter is limited to 6 V. The guidebook also establishes criteria for load balancing and var management at the feeder level and for the substation. The guidebook helps the user determine the best methods for controlling the voltage based on the specific configuration of their electrical infrastructure.

Cost effective approaches
The research performed during the DEI study shows that performing system improvements and operating the distribution feeder voltage in the lower half of the ANSI standard can be done cost effectively to save energy, reduce kW and kvar demand without negatively impacting the service to customers. Using these tools, utilities should be able to continue to improve operating procedures, while using the latest technologies and engineering practices to achieve greater total savings. Moreover, they should be able to achieve greater savings on the utility side of the meter as the utilities begin to understand more about how their distribution system is performing.

Distribution efficiency methods that lower the average distribution voltage 2-3% are achievable at a cost of 2-15 Mills per kWh. This is based on the study findings for the end-use load mix that results in a CVR factor of 0.5 to 0.7. There may be even less expensive methods. For example, in the region involved (the Pacific Northwest), the study found about 100 average MW that could be saved for very little investment, around 1-2 Mills per kWh. The investment would require these utilities to perform only minor engineering changes to determine the appropriate voltage control settings.

Some of the more promising approaches found in the study for voltage reduction are as follows:

  • Home voltage regulating devices can be effectively implemented to fix select voltage issues at a lower cost than the more traditional extension of primary lines, addition of more transformers, or the replacement of secondary conductors. Fixing the voltage issues for a few locations will benefit the entire feeder and substation system by allowing the entire system to achieve a lower overall voltage reduction.
  • Using line drop compensation (LDC) along with system improvements will capture the majority of the potential energy savings at a fairly low cost. However, because LDC uses calculations rather than actual measurement of the voltage at the end of the line, additional safety margins have to be used.
  • End of line voltage feedback control systems will achieve the maximum energy savings. These types of voltage control systems can keep the feeder voltage level at the minimum criteria at all load levels, and do not require the same margin of safety as that of the LDC voltage control method.

The area of the distribution system that was not specifically studied as part of the DEI was performance of the low voltage secondary system. As standard practice in the industry, all utilities in the study used a fixed secondary voltage drop regardless of load.

Implementation of distribution efficiency measures
With a combination of existing tools and the tools developed as part of the DEI study, utilities can start implementing distribution efficiency measures on their existing electric systems. The application of each distribution efficiency measure has to be analysed so that the benefits and costs align with the utility’s goals. The DEI study has developed the software and guidelines to help determine the costs and benefits.

The study also shows that there is no single technique that can be applied to all conditions. Rather, each distribution system has its own unique properties that require specific system improvements and voltage control methods to optimise the life-cycle cost of the investment in the distribution infrastructure.

One area of the distribution infrastructure that is not well understood is the low voltage secondary system. As utilities continue to move toward more advanced metering technologies, more information will be available and will provide valuable information regarding the performance of the low voltage system. Advanced metering infrastructure (AMI) can provide virtually real time data at the customer’s level and this information can be used to improve systems, thereby allowing the system voltage to operate closer the lower allowable limits. For utilities considering or implementing AMI, the CVR benefit should be included in their calculations of distribution system benefits as part of their business cases.

The DEI study proves conclusively that energy savings through efficient design and voltage regulation can be achieved with no negative impact to the customers. The next logical step in distribution efficiency is to address policy issues that need to be implemented to ensure that the study findings are adopted as standard design and operating practices. Distribution efficiency reduces energy requirements similar to other programmes already recognised by policy makers, such as additional insulation, the replacement of windows, or compact fluorescent light bulbs.

Copies of the final DEI report, software tools, and guide book can be downloaded at