Cost Effectiveness Assessment (CEA) tests for Demand Response program
Electricity Distribution Companies (DISCOMs) need to evaluate the impact of Demand Flexibility (DF) and Demand Response (DR) programs using standard tests such as the Total Resource Cost (TRC), Ratepayer Impact Measure (RIM), and Long-Term Resource Impact Measure (LTRIM). In addition to these mandatory tests, supplementary evaluations including the Participant Cost Test (PCT), Societal Cost Test (SCT), and Aggregator Cost Test have been incorporated in the Excel tool to provide a comprehensive assessment of program impacts from different stakeholder perspectives.
As per Maharashtra Electricity Regulatory Commissions Demand Flexibility and Demand Side Management regulations 2024, evaluation criteria for standard tests are as follows:
Total Resource Cost (TRC) as the main hurdle test: All DF / DSM programs that show positive number for the Net Present Value (NPV) of the Benefits over the NPV of Costs should be considered for evaluation of RIM test
Ratepayer Impact Measure (RIM) test: DF / DSM programs that show positive number when NPV of the Benefits over the Costs for the Ratepayers are considered should be implemented
Life-cycle Revenue Impact – RIM (LRIRIM test): DF / DSM programs that do not show positive number for RIM test should be implemented if the tariff impact due to the implementation of the DF / DSM programs is less than Rs. 0.005/kWh or less than 0.05% of the existing tariff, whichever is higher. All the energy savings numbers should be corrected for power shortages, if any.
For PCT, SCT and Aggregator cost tests, positive NPV of benefits over costs indicates that the program is financially viable for the respective stakeholder.
The Excel sheet has been developed to support the implementation of an aggregator-led Air Conditioner Demand Response (AC-DR) program. The cost of AC controllers can be shared among the DISCOM, consumers, and the aggregator. DISCOM will distribute program benefits to the aggregator and consumers in the form of DR aggregation fees and DR incentives, respectively.
The tool enables users to create different scenarios by adjusting the input values provided at the top of the sheet. This can help DISCOMs and technology providers assess technology costs, design suitable incentive structures, and determine appropriate DR service fees for aggregators.
