Analysis of Microgrid Projects in New York State

As part of a strategy to transform infrastructure and enhance its resiliency, New York State is examining options for distributed and localized electricity generation capacity (microgrids). Each participating community submits a design proposal, the acceptance of which rests in part on an analysis of the potential project’s costs and benefits. Employing a customized methodology and model, IEc analyzed the 80 feasibility studies prepared by program applicants. The New York State Energy Research and Development Authority (NYSERDA) used these assessments to select projects and distribute funding.

IEc’s model examines the benefits and costs of a microgrid from a social cost perspective.  It considers the full range of each project’s potential costs, including initial design and planning costs; capital costs; operation and maintenance costs; and environmental costs.  It also quantifies and values a broad range of potential project benefits, including energy cost savings; fuel savings associated with the use of combined heat and power systems; savings in the costs associated with maintaining sufficient generating and distribution capacity; reliability improvements; power quality improvements; and environmental benefits.  In addition, it examines the extent to which development of a microgrid would enhance the ability of facilities served by the system to maintain operations during major power outages, and estimates the economic benefits of such improvements in resiliency.