Lawrence Berkeley National Laboratory

The era of publicly mandated GHG emissions restrictions in the United States has begun with recent legislation in California and seven northeastern states. Commercial and industrial buildings can improve the carbon-efficiency of end-use energy consumption by installing technologies such as on-site cogeneration of electricity and useful heat in combined heat and power systems, thermally-activated cooling, solar electric and thermal equipment, and energy storage -- collectively termed distributed energy resources (DER). This research examines a collection of buildings in California, the Northeast, and the southern United States to demonstrate the effects of regional characteristics such as the carbon intensity of central electricity grid, the climate-driven demand for space heating and cooling, and the availability of solar insolation. The results illustrate that the magnitude of a realistic carbon tax ($100/tC) is too small to incent significant carbon-reducing effects on economically optimal DER adoption. In large part, this is because cost reduction and carbon reduction objectives are roughly aligned, even in the absence of a carbon tax.