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Open Access Publications from the University of California

Comparison of Actual Costs to Integrate Commercial Buildings with the Grid


During the past decade, the technology to automate demand response (DR) in buildings and industrial facilities has advanced significantly. Automation allows rapid, repeatable, reliable operation. This study focuses on costs for DR automation in commercial buildings with some discussion on residential buildings and industrial facilities. DR automation technology relies on numerous components, including communication systems, hardware and software gateways, standards-based messaging protocols, controls and integration platforms, and measurement and telemetry systems. This paper discusses the impact factors that contribute to the costs of automated DR systems, with a focus on OpenADR 1.0 and 2.0 systems. In addition, this report compares cost data from several DR automation programs and pilot projects, evaluates trends in the cost per unit of DR and kilowatts (kW) available from automated systems, and applies a standard naming convention and classification or taxonomy for system elements. In summary, median costs for the 56 installed automated DR systems studied here are about $200/kW. The deviation around this median is large with costs in some cases being an order of magnitude greater or less than median. Costs to automate fast DR systems for ancillary services are not fully analyzed in this report because additional research is needed to determine the total such costs.

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