Distributed Renewable Energy Operating Impacts and Valuation Study

Section 6
6.4.7 Fixed and Variable Savings Estimates
Table 6-9 provides an analysis of the fixed and variable nature of the estimated savings
associated with solar DE deployment. It separates the variable savings from the total energy
related savings (from Table 6-6), less the fixed O&M savings (if any), divided by the total solar
DE savings. The fixed savings are then the remaining percentage (i.e. 1 minus the variable
savings percent). Any capacity cost savings are included in the total solar DE savings, but not in
the energy related savings, and therefore are part of fixed savings.
As indicated in the tables above, the primary driver of value for solar DE deployment is the
reduction in fuel and purchased power (discussed in Section 5). While the capacity cost
reductions do add value, they are highly dependent on the number of solar DE installations, as
well as the specific location of these installations for the distribution system.
The results indicate that for the larger deployment cases (Medium and High Penetration Cases,
as well as the Target scenario and single-axis sensitivity), the savings associated with solar DE
deployment are overwhelmingly from variable energy savings rather than fixed capacity savings.
For the Low Penetration Case, where there are less savings overall, the value is roughly one-third
fixed and two-thirds variable (for 2025).
Table 6-9
Fixed and Variable Cost Savings of Solar DE Savings (%)
Fixed Savings
(%)
Variable Savings
(%)
Low Penetration Case
2010 0.0% 100.0%
2015 10.5% 89.5%
2025 30.4% 69.6%
Medium Penetration Case
2010 0.0% 100.0%
2015 11.8% 88.2%
2025 29.6% 70.4%
High Penetration Case
2010 0.0% 100.0%
2015 11.8% 88.2%
2025 27.6% 72.4%
Target Scenario
2010 4.1% 95.9%
2015 14.8% 85.2%
2025 29.7% 70.3%
Single-Axis Sensitivity
2010 3.9% 96.1%
2015 15.6% 84.4%
2025 29.2% 70.8%
6-16 R. W. Beck, Inc. Arizona Public Service