The Electricity Journal xxx (xxxx) xxx–xxx

Contents lists available at ScienceDirect

The Electricity Journal

journal homepage: www.elsevier.com/locate/tej

Energy Policy Institute's Seventh Annual Energy Policy Research Conference

Economic and emission-saving benefits of utilizing demand response and

distributed renewables in microgrids☆
Zahra Fallahi, Amanda D. Smith
⁎

Site-Specific Energy Systems Laboratory, Department of Mechanical Engineering, 1495 East 100 South, MEK 1550, University of Utah, Salt Lake City, UT, 84112, USA

A R T I C L E I N F O A B S T R A C T

Keywords: The authors present several scenarios of demand response actions based on adjustments to a building’s tem-
Emissions perature management system in combination with renewable DER integration in microgrids. Economic benefits
Electrical grid from $9,000 to $167,000 appear possible when implementing demand response in a microgrid of 30 to 50
CO2 emission factor additional buildings. The scenarios also demonstrate the potential emission-saving effects of demand response at
Demand response
the grid level.
Building operations

1. Introduction Reducing the emission production by electricity use can be seen as

With increasing integration of renewable energy resources in power
generation, the challenges associated with their variability, such as
dispatchability, grow. In the state of California, increasing penetration
of solar electricity in the grid extends the risks of over-generation and
large ramp-up needs during peak hours or when the solar irradiation is
not available, as shown in the California Independent System
Operator’s “duck graph” (CAISO, 2012), Fig. 1. The resulting ramping
needs are typically met by fossil-fuel-fired generation, which can be
expensive, complicated, and inefficient. When thermoelectric power
plants have frequent startups, this is also more harmful to the en-
vironment than steady operations (CAISO, 2012; de Groot et al., 2017).
Commercial buildings are responsible for 18% of total U.S. emis-
sions, and a building’s operational emissions can be categorized into
direct and indirect sources (U.S. Department of Energy, 2012). Direct
sources of emissions include all combustion at the building site, gen-
erally produced by burning natural gas or other fuels for heating, hot
water, or kitchen needs. Indirect sources of emissions are not located at
the building site and include all emissions associated with the elec-
tricity purchases. Depending on the location of the building and the
grid network to which it is connected, emission factors will vary in time
with the electricity production (Harris et al., 2015). The time when
electricity is purchased correlates to some total demand on the grid and
a certain set of generators being used to meet this load. To accurately
calculate the indirect emissions of the building, the electricity use trend
on an hourly or sub-hourly basis is needed (Harris et al., 2015).
adding more clean and renewable sources of electricity to the fuel mix.
At the same time, various building certificates such as LEED and LBC
encourage building owners to integrate some features of on-site re-
newable electricity production in the building design and/or renovation
plans, for example, rooftop PV. The optimal size of rooftop PV is will
depend on the annual load of the building as well as solar irradiation
availability in the site of the building (Bianchi and Smith, 2016).
In larger buildings, with lower skin ratios, usually the maximum
available area on the rooftop is used for PV arrays; however, this source
of electricity production may not be sufficient for the building’s load.
On the other hand, in smaller buildings electricity production may be
higher than the actual building loads in some hours of the day. In this
case, some buildings may be able to sell the excess electricity back to
the grid. Although this may be financially beneficial for the building
owner, in places such as California this will amplify the problems with
the duck curve, which is undesirable for the ISO or balancing authority.
Different ways of storing the excess energy are more beneficial in this
case.
Energy storage can be provided in a variety of ways, such as by
using batteries. However, batteries are expensive and degrade after a
certain number of charge and discharge cycles. Another way of storing
energy is using the thermal mass of the building. In this case, during the
hours of excess energy production, “coolth” (a lack of heat) or warmth
can be stored in the building thermal mass and used when on-site en-
ergy production is low (Kreith, 2014). In this work, storing coolth is
investigated using demand response mechanisms. A signal will inform

☆
The authors present several scenarios of demand response actions based on adjustments to a building’s temperature management system in combination with renewable DER
integration in microgrids. Economic benefits from $9000 to $167,000 appear possible when implementing demand response in a microgrid of 30 to 50 additional buildings. The scenarios
also demonstrate the potential emission-saving effects of demand response at the grid level.
⁎
Corresponding author.
E-mail address: amanda.d.smith@utah.edu (A.D. Smith).

https://doi.org/10.1016/j.tej.2017.10.008

1040-6190/ © 2017 Elsevier Inc. All rights reserved.

Please cite this article as: Fallahi, Z., The Electricity Journal (2017), http://dx.doi.org/10.1016/j.tej.2017.10.008
Z. Fallahi, A.D. Smith
the building automation system (BAS) to increase the load on AC units
and decrease the room temperature as soon as solar electricity gen-
eration is higher than the building load. Later, the stored energy in the
thermal mass of the building will keep the rooms at a suitable tem-
perature and will decrease the need for air conditioning when on-site
electricity production is not sufficient.
These changes in the operational schedule of the building will
change the electricity use trends of the building and can affect the
amount of purchased electricity from the grid (Srikantha et al., 2012).
We investigate this variability in this paper. At the same time, due to
temporal nature of emission factors linked to electricity production, the
changes in electricity use trend of the building will affect the total in-
direct emission production of the building (Harris et al., 2015; Fallahi
and Smith, 2016).
In this work, simulations of four types of commercial buildings are
performed. Large, medium, and small office building as well as stores,
typically seen on campuses, are simulated using EnergyPlus, the
building energy consumption simulator developed by DOE. This soft-
ware helps researchers to investigate and estimate the annual buildings
energy consumption in an hourly and sub-hourly level both for natural
gas and electricity. In this work, typical commercial buildings in the
DOE climate region of 2 B is simulated (Ernest Orlando Lawrence
Berkeley National Laboratory, 2015). The weather data are acquired
from TMY3 weather files recorded in San Diego International Airport.
Although a demand response event should be triggered based on live
weather conditions, TMY3 data for irradiation is used to show the ty-
pical rooftop PV production and building consumption and the poten-
tial for using DR measures in commercial buildings (Wilcox and Marion,
2008).
2. Methods
In this work, four commercial building models are simulated to
evaluate the potential benefits of a demand response action on building-
related emissions. Use of the thermal mass of the building, as a mean of
energy storage may be beneficial in load flexibility in the building. This
kind of storage and load change due to generation and consumption
patterns can be implemented in every commercial building without the
need of capital cost. In this section, the methods used for assessment
and implementation of DR are discussed.
2.1. Building energy modeling
One of the most difficult factors in building energy modeling is the
operational schedule and transient load changes in the building.
Prediction of the consumer behavior is not an easy task as it involves a
great deal of uncertainty. In a commercial building, due to central
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Fig. 1. Duck Graph representing over generation and ramp up risks,
California ISO (CAISO, 2012).
adjustment and management of the operation as well as pre-determined
operational hours of the building and number of occupants, operational
schedule modeling can be more reliable compared with the residential
sector. For this reason we are focusing on commercial building demand
response in this article.
Four commercial building models are studied: examples of small,
medium and large office buildings, as well as a retail stores. These re-
present common building types within the U.S. building stock, and si-
milar buildings can be seen on university campuses. In this work, the
building energy modeling (BEM) is performed using EnergyPlus soft-
ware. EnergyPlus, developed by the U.S. Department of Energy, is a tool
for energy researchers to simulate buildings’ energy consumption in
hourly or sub-hourly ranges for different time periods up to a full year.
EnergyPlus uses two main model pieces. One is the actual building
information containing the geometry and orientation of the building,
material used for construction, occupancy, and operational schedule.
The other is the weather file associated with the location of the
building, informing the software about the ambient temperature, solar
irradiation, humidity, wind speed, and other relevant information
(DOE, 2014; NREL, 2017).
In this work, building models are obtained from the prototype
building database provided by DOE, and all construction is designed to
satisfy the 90.1-2010 standard. The prototype commercial buildings are
modeled based on the location of the building and consider the typical
building construction and features in the buildings climate zone (Fig. 3)
(Deru et al., 2011; Baecheler et al., 2010).
Typical meteorological year (TMY) Version 3 weather data is used;
TMY3 represents an average of weather data from a pool of 30 years of
information. Although it does not show the most recent weather con-
ditions and does not consider extremes in the weather features, it is a
useful resource for showing the typical weather information and af-
fected building energy consumption. The weather data in this work are
obtained from San Diego International Airport (Wilcox and Marion,
2008).
2.2. Demand response
A simple option for shifting electricity use of a building’s HVAC
system, a managerial retrofit, is used to provide electrical load shifting.
Both the building’s electricity demand and the rooftop PV system’s
electricity production are used to signal the appropriate times for de-
mand response actions. Pre-calculations are performed using
EnergyPlus to predict the energy consumption of the building, designed
to meet the 90.1-2010 standard, and also to estimate the rooftop PV
production in hourly time steps during the year. These initial calculated
values will later on help to determine the relations between generation
and consumption of electricity in a building. As mentioned above, the
Z. Fallahi, A.D. Smith
optimum area of rooftop PV depends of the consumption of the building
as well as solar irradiation availability to minimize the unused elec-
tricity generation. For large buildings with significant electrical loads,
this value will be the maximum area available on a rooftop. However,
for small buildings, the optimum will be a fraction of the rooftop. If not
subsidized, the installation of rooftop PV for small buildings may not be
very interesting for the owner. In this work, it is assumed the group of
buildings are in proximity and the managing party has decided to al-
locate all the available rooftop areas to the PV arrays, as on a university
campus. In this case, the unused electricity generated in small buildings
will be further consumed in larger buildings minimizing the total
electricity purchase.
Because solar electrical generation is variable, adding flexibility in
the timing of building electricity use will increase a facility’s ability to
fully capture the benefits of on-site solar power generation. For each
building, in case of over-generation of rooftop PV compared to the
building’s actual load, the HVAC settings and the temperature set point
for cooling is adjusted to minimize the amount of unused electricity.
Over cooling of the building when on-site solar generation is available
will affect the electricity purchases from the grid, in later hours of the
day. The coolth stored in the thermal mass of the building will lessen
the need for AC systems energy consumption to provide thermal com-
fort (Figs. 2 and 3).
2.3. CO2 emissions
Buildings are responsible for two different types of emissions in
operation. Direct emissions are produced on site at the building, usually
coming from burning fuel to cover heating needs of the building.
Indirect emission, however, does not occur at the building site and is
associated with purchased electricity. Depending on the grid and the
operation of different generators, the fuel mix for generating electricity
Fig. 2. eGrid Sub-region representation map, (US EP, 2017).
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is variable and therefore the emission factor of the purchased electricity
is temporal. For the emission calculations in this work, temporal
emission factors for CO2 provided by the National Energy Renewable
Laboratory (NREL) were used. These temporal emission factors are
available for CO2, SO2, and NOx and are provided for each eGrid region
(Fig. 2) (US EPA, 2017). The hourly averaged emission factors and
hourly electricity consumption are used to calculate the final indirect
emission in a year for the studied buildings.
3. Results
Electricity use for the studied buildings in a sample day is compared
with the highest amount of rooftop PV production for a stand-alone
building (Figs. 4–7). As seen in Fig. 4, in a large office building the PV
electricity production is not large enough to surpass the building needs
due to a low skin ratio. However, in medium and small office buildings
and the retail store, PV production is higher than actual building
electricity consumption during several hours of the day, as seen in
Figs. 5–7. In a small office building (Fig. 6), it is seen that PV excess
electricity production stretches beyond building's working hours, which
shows that a smaller rooftop PV system may be more optimal for a
stand-alone small office building.
In applying demand response to a building’s operations, the elec-
tricity use of the building is shifted to coincide with hours of high solar
irradiation, and then decrease when the building is relying on the grid
for electricity purchases. Fig. 8 shows how demand response changes
the building consumption trend on a summer day. The increase in the
demand response trend for electricity consumption matches the hours
of excess PV electricity generation (Fig. 5).
In Fig. 9 through Fig. 12, electricity purchases from the grid on a
summer day are shown for the medium office, small office and store,
respectively. In a stand-alone large building, the electricity production
Z. Fallahi, A.D. Smith The Electricity Journal xxx (xxxx) xxx–xxx

Fig. 3. USA climate zones, (Baecheler et al., 2010).

Fig. 5. Medium Office Building, Rooftop Generation Capacity Comparison with Default
Fig. 4. Large Office Building, Rooftop Generation Capacity Comparison with Default
Building Electricity Use, 90-1-2010.
Building Electricity Use, 90-1-2010.

hours that can be used by other buildings in the campus (Fig. 12).
does not surpass the building use and therefore is not desirable for
Emission factors associated with the grid vary with time and will
stand-alone demand response practice. In small office buildings, de-
vary differently in different regions of the grid based on the balancing
mand response does not affect the amount of purchased electricity in a
area’s generation portfolio. In the state of California’s CAMX eGrid re-
sample summer day (Fig. 10). This is due to long hours of excess PV
gion, due to the integration of solar powered electricity production,
generation that extend beyond the working hours of the building, as
emission factors for purchased electricity are higher in the beginning of
well as minimal HVAC needs during night hours or when the building is
the day and in the evening hours compared to midday values. The
not occupied. However, in the retail store and medium office building,
change in load trend from the demand response in a commercial
the purchase is lowered during evening hours, as shown in Figs. 9 and
building may be used to help reduce emissions production. Fig. 13
11. On the other hand, if we look at the excess PV production in the
shows how demand response affected the electricity purchase trend. In
small office building, the demand response has the potential to change
a medium office building, practicing demand response increases the
the excess electricity trend. Fig. 10 demonstrates that for a summer day,
purchase during times of cleaner power generation, and as a result the
DR in small office building increases the excess power in the evening

4
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Fig. 6. Small Office Building, Rooftop Generation Capacity Comparison with Default
Building Electricity Use, 90-1-2010.
Fig. 9. Medium Office Building, Effect of Demand Response in Electricity Purchase.

Fig. 7. Store Building, Rooftop Generation Capacity Comparison with Default Building
Electricity Use, 90-1-2010.
Fig. 8. Medium Office Building, Effect of Demand Response in Electricity Use.
purchase is lowered the evening when more CO2 emissions are asso-
ciated with electricity purchases. Table 1 shows the potential of indirect
CO2 emission reduction in a stand-alone small office, medium office,
and the retail store.
Next, we simulated a campus of buildings to study the potential for
using “excess” PV-produced electricity within the microgrid by de-
ploying demand response in a group of buildings. As seen in Fig. 11, DR
in a small office building that allocated the maximum area for rooftop
PV is slightly affected by demand response, if this excess electricity is
provided for a large office building (Fig. 4). DR in the small building
will affect the final purchase trend in the larger building. Grouping
different numbers of small and medium office buildings will affect the
large office building purchase, as in Fig. 14. As seen, the use of excess
electricity produced in smaller buildings lowered the purchases com-
pared to a stand-alone building. At the same time, it is interesting to
notice the trend is mostly affected by adding more small buildings: the
purchase associated with 25 small and 25 medium buildings is very
similar to 5 medium buildings and 25 small buildings.
The microgrid emissions produced for different combinations of
buildings is also shown in Table 2. The maximum reduction in emis-
sions among the scenarios happens with 25 small office buildings and
10 medium buildings combined with a large building. The reason is that
changes in excess electricity of small office building after demand re-
sponse affect the large building purchase trend; further, changes in
electricity purchases in the medium office building encourage less grid
electricity use in the evening when the fuel mix does not include as
many renewable resources.
The DR effect on electricity use of the buildings in a microgrid is
shown in Fig. 15. Comparing two combinations, the larger microgrid is
more successful in minimizing the excess onsite power generation by
PV. As a consequence, its evening load reductions are more pro-
nounced, resulting in lower total emission production, as in Table 2.
Fig. 14 shows having a large office building with 25 small office
buildings in a microgrid is most beneficial in the summer day purchase
of electricity. Table 3 presents the annual electricity purchase, use, and
cost for a large office building within a microgrid.
In medium office buildings, a demand response retrofit affects the
electricity use pattern and also the excess PV generated electricity. The
combined effect of the large office building hours of demand response
and, therefore, the electricity use follows a nonlinear pattern. As shown
in Table 3 electricity use is increased for all three cases with demand
response. In contrast, the amount of electricity purchased from the grid
is reduced with demand response measure. The economic savings are

5
Z. Fallahi, A.D. Smith
Fig. 10. Small Office Building, Effect of Demand Response in Electricity Purchase.
Fig. 11. Small OfficeBuilding, Effect of Demand Response in Excess Photovoltaic
Electricity Production.
calculated with the flat rate commercial pricing of electricity in the
state of California (US EIA, 2012). Different methods of electricity
prices, considering peak hours and the rate of changes in purchases will
affect the final savings.
4. Conclusion
In this article, we studied the potential of using demand response for
electricity purchase reduction and emission reduction in commercial
buildings. The buildings have solar PV electricity generation on-site and
with demand response practice, the building automation system (BAS)
can be programmed to use more or less electricity. In HVAC system
demand response, the BAS will change the temperature set points to
over-cool the thermal mass of the building when excess PV electricity is
available. The thermal energy stored in the thermal mass of the
building will provide air conditioning during evening hours or when the
solar PV is not widely available. This change in the pattern of electricity
use by the building results in changes in electricity purchases as well as
changes in the indirect emission productions attributed to the building.
For a single building, the size and timing of its electrical loads and
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Fig. 12. Store Building, Effect of Demand Response in Electricity Purchase.
the available rooftop area limit the potential for producing and self-
consuming renewable distributed power. In a small building, assuming
the use of the whole rooftop for PV electricity production, the hours of
excess electricity are more than the actual occupation of the building
during working hours. Therefore, the discussed DR practice does not
affect the purchased electricity of the small building. At the same time,
as net metering is not always applicable, for a stand-alone small
building that is located in an area with high solar irradiation, the op-
timal area for PV arrays is smaller than the rooftop, in order to mini-
mize the amount of unused electricity. In that case, the effect of DR on
small building will be similar to Fig. 9, with lower electricity purchases
in the evening hours compared to the default schedules.
However, when combining multiple buildings, it is possible to use
the excess electricity generation on-site for the buildings with higher
consumption. As seen in Fig. 4, a stand-alone large office building
cannot self-sufficiently produce its electricity consumption. As part of
the microgrid, the excess PV electricity generation from other smaller-
sized buildings can be used for the large office building. Applying the
temperature set-point demand response for the micro-grid, also yielded
a 1.37% reduction in indirect CO2 emissions.
Demand response has potential benefits for building owners, both
stand-alone and within a microgrid. Additionally, applying demand
response in areas with large capacities of solar power production, such
as the CAMX eGrid region, can be helpful to the grid. Load increase
when solar availability is abundant reduces the risk of over-generation
and the need for negative pricing of electricity to maintain grid balance.
Also, the reduction of electricity purchases during the evening hours
will result in less ramp-up capacity needed for the grid and will lessen
the technical difficulties associated with the sudden load changes, de-
monstrating the benefits of grid-centered demand response for ISOs.
Finally, the demand response and other load shifting methods, in-
tegrated with renewable resource availability, show that electricity
consumption use reduction is not the only possible method for reducing
the emission production associated with the electricity purchase.
Building emission reduction retrofits are able to modify the electricity
consumption pattern and decrease the load while the fuel mix used for
electricity generation is heavily weighted toward fossil fuels. Moreover,
increasing the load during “cleaner” hours of electricity generation will
result in lower emissions overall.
Acknowledgements
The authors thank Mostafa Sahraei-Ardakani (Electrical and
Z. Fallahi, A.D. Smith The Electricity Journal xxx (xxxx) xxx–xxx

Fig. 13. Medium Office Building, the shift in the load can change the
total emission production due to temporal EF.

Table 1
Annual Emission Reduction for Stand-Alone Commercial Buildings.

Small Office Medium Office Store

57.5 kg CO2 316.3 kg CO2 547.5 kg CO2

Fig. 15. The Effect of Demand Response in Electricity consumption comparing with Photo
Voltaic Power Generation in micro-grid.

Table 3
Comparison of Large Office Building Annual Electricity Use, Purchase and Economical
Savings in Micro-grid, Demand Response vs. the 90-1-2010 standard.

Fig. 14. Large Office Electricity Purchases in Micro-grid context. Combination Large Office Large Office Large Office
Savings Electricity Savings Electricity Savings
Use [MWh] Purchase[MWh] Economic [$]
Table 2
Micro Grid Emission Reduction by DR. Consisted of 1 Large Office, 3 Stores, and various 5 Medium, 25 −170.03 74.50 11123.24
Medium and Small offices. Small
10 Medium, 25 −114.95 11.23 166606.13
No. of Small Offices Small
25 Medium, 25 −192.89 61.14 9128.93
5 10 25 Small

No. of Medium 5 −51% or −0.12% or 1.03% or

Offices −17282 −3828 31940 Computer Engineering, University of Utah) for his helpful suggestions
10 −1.15% or −0.51% or 1.37% or
related to the development of this research. Zahra Fallahi was sup-
−41762 −18039 47435
25 −1.00% or −0.43% or 0.74% or ported by a travel grant from the Energy Policy Institute (Boise State
−46277 −19589 33683 University) to present this work at the 2017 Energy Policy Research
Conference.

7
Z. Fallahi, A.D. Smith
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Zahra Fallahi is a PhD candidate in Mechanical Engineering at the University of Utah and
a researcher with the Site-Specific Energy Systems Laboratory. She received her bache-
lor’s degree in mechanical engineering from U. Tehran, Iran, and her master’s degree in
Energy Management and Sustainability from EPFL, Switzerland. She is interested in the
built environment and reducing the production of emissions. She is working on both
direct and indirect emissions and looking for different methods of clean energy use in
commercial buildings. In her research presented in EPRC conference, she has investigated
the potential for demand response to reduce emissions from commercial buildings and
considered electricity purchases.
Amanda D. Smith is an energy sustainability researcher and is Assistant Professor of
Mechanical Engineering and director of the Site-Specific Energy Systems Laboratory at
the University of Utah. She received her bachelor’s degree in mechanical engineering
from U. Memphis, TN, USA, and her PhD in mechanical engineering from Mississippi
State University, TN, USA. She also serves as faculty advisor to the ASHRAE Student
Branch and is affiliated with the Global Change and Sustainability Center and the Center
for Ecological Planning and Design at the University of Utah. Her expertise is in building
science, distributed energy resources, energy systems modeling, and quantifying the en-
vironmental impacts of energy conversion. In 2015 and 2016, she was recognized as the
ASHRAE Utah Educator of the Year, Utah Engineers Council Educator of the Year, and
received the Alta Sustainability Leadership Award for Integrating Sustainability
Education. She is Associate Editor of the journal Sustainable Energy Technologies and
Assessments and an active member of the American Society of Mechanical Engineers and
ASHRAE.