2016 NYAE Q2 Recap: Generators as DERs?

Megacities use 9% of world’s electricity.  New York City is the world’s largest mega-city, by far.  In areas of extreme congestion, there is a significant, and growing need for consumers to reduce their electric load at peak times to prevent grid outages, preserve existing electric infrastructure and contain network damages – all of which translate into higher costs to the ratepayer and greater economic benefits for customer sided distributed energy resources (DERs).  

The vast majority of onsite generators are purchased and maintained for emergency use only.  Typically, these emergency loads represent a fraction (<15%) of nameplate generator capacity.

Why Generators?

1. Approved, underused critical energy asset that exists at nearly every major commercial building throughout NYC

2. Unmatched reliability and performance for both customers (microgrid capabilities) and utilities (peak load management)

3. Utility scale impact as a behind-the-meter Distributed Energy Resource.  An estimated 1+ Gigawatts of nameplate onsite generator capacity exists throughout Greater New York City. 

During Hurricane Sandy, it quickly became apparent that emergency back power does not deliver the power necessary during a prolonged outage to meet basic human needs, or commercial tenants’ expectations.  It also became apparent that many sites would have benefited from turning on their generators hours before Sandy actually hit NYC (storm avoidance) to reveal any mechanical failures not typically picked up in regular testing. 

Value Proposition: Resiliency, Reliability, Money

1.     Microgrid solutions with new ultra-clean diesel generators can have 3 – 5 year paybacks with ongoing revenue and cost saving streams. These microgrid solutions carry a standby designation and would be allowed to run for all DR programs. 

2.     Microgrid solutions that upgrade existing generators with proper pollution controls can have under 3 year paybacks with ongoing revenue and cost saving streams. 

Regulatory Compliance

In recent months, critical legislation has either passed or advanced that directly impacts the use of diesel generators for economic dispatch and /or Demand Response, namely: 

1. DEC NYS Rule Part 222 :  http://www.dec.ny.gov/regulations/104280.html

The NYS DEC Rule Part 222 effectively states, as of May 1, 2016, that NYC > 200kW diesel generators used for economic gain must meet new emission requirements.  Prior to summer 2016 DR participation, all owners that used diesel generators in the last two years for Demand Response needed to report this to the DEC to receive a one year extension to comply with this rule.  Important to note, starting May 1, 2016, the testing of diesel generators during 1p – 8p is forbidden May – September 30th of each year. 

2.  If the New York City Int. 271 legislation passes, NSPS’s Tier 4 Final limits would be likely required on nearly all emergency and DR-eligible generators in the City.

·       §24-149.6 Any stationary generator registration on or after 1 July 2014, or renewal on or after 1 January 2018, requires that “such stationary generator is equipped with an engine certified to the tier four emissions standards established by the United States environmental protection agency as set forth in table one of section 1039.101 of title forty of the code of federal regulations or to any subsequent United States environmental protection agency emissions standard for such engine that is at least as stringent.

A Tier IV Certified diesel generator is 90-95% cleaner than a diesel engine manufactured a decade ago.  With greater fuel efficiency than natural gas engines, Tier IV Certified diesel engines deliver considerably cleaner electricity in comparison to power produced by centralized power plants. Passing federal, state and local emission requirements, Tier IV Certified diesel microgrid solutions are uniquely able to participate in all New York State and ConEd Demand Response programs. 

Email me for more information regarding cost / benefits of either upgrading an existing Tier II generator or purchasing a new, Tier IV Certified engine.