# "Value of electricity savings" differ for similar energy charge profiles

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Brett K
"Value of electricity savings" differ for similar energy charge profiles

Hi all

I have been trying to understand SAM's energy charge model, however I get results that I dont understand or dont make sense. I would expect the "Value of electricity savings" in the cash flow results section to be the same for the attached two energy charge profiles but they differ.

Any help/suggestions would be appreciated.

Thanks

Paul Gilman

Hi Brett,

The "value of electricity savings" in the cash flow is equivalent to the annual electricity bill savings, which SAM calculates by subtracting the "bill without system" from the "bill with system." In other words, SAM determines what the annual electricity bill would have been with no renewable energy system ("without system") and what it is with the system ("with system"), and considers the difference between the two to be the value of electricity savings.

The electricity bill with system depends on the amount of electricity generated by the system, the electricity consumed by the building, and the rate structure used to calculate the electricity bill. You can see how SAM accumulates kWh into the different time-of-use periods and tiers, and how it assigns a dollar amount to each on the Data Tab of the Results page by expanding the "Electricity Rate Data by Tier and Period" section of the variable list.

When you specify energy charge rates with tiers, you need at least 2 tiers, one to specify the rate for the first block of kWh, and one for the rate for any kWh in excess of the first block. So, your Scenario 1 should look something like this:

And, for Scenario 2, there should be two tiers for each of the 6 time-of-use periods.

Finally, the option you choose for how SAM handles excess generation will affect the electricity bill calculation. For a rate structure with both time-of-use periods and tiers, the excess generation may accumulate by period and tier within each month, and may roll over into next month's periods and tiers in different ways depending on the option.

Best regards,
Paul.

Brett K

Hi Paul

Thank you for your detailed feedback!

I have simplified the SAM file so that there is no excess generation and made sure that the generation does not exceed the tier 1 figure. I have also changed the tier max usage to 1e+038 just to make sure that this is not the issue.

It seems that if I have different periods with the same buy rate, and then split the day into different periods, I still get different figures for "value of electricity savings". I get \$13430 when simulating scenario 2, and \$15002 when simulating scenario 1 when no other variables are changed.

I plan on using different buy rates for each period once I get results that make sense to me.

Please find the SAM file attached. If you can look it over I would appreciate it.

Kind regards,
Brett

P.S. The dollar rate/kWh is extremely high as I use the figure it as South African Rand.

Paul Gilman

Hi Brett,

Thank you for sending the files.

The difference in annual electricity bill savings is caused by the different scenarios using different periods to accumulate kWh.

Because you chose the "Monthly total excess credited to next month bill in \$ at sell rate" option, SAM accumulates excess generation by time-of-use (TOU) period for each month. You also set the sell rate for all TOU periods to zero, so the system's value consists only of its ability to reduce energy charges, or purchases of electricity from the grid.

For a scenario with more than one TOU period, the model considers the monthly grid purchases for each TOU period to be the difference between the total load over the TOU period and total system generation over the TOU period for the month. Two scenarios with different TOU periods will result in different totals over the TOU period.

Best regards,
Paul.

Brett K

Hi Paul

I made a silly mistake and didn’t realize that there would be electricity exporting with the setting that I used. I increased the load consumption so there is no exportation and results make sense now. Problem solved:)

I still don’t understand why SAM generates two different saving amounts for the two initial scenarios if the buy rates are the same (\$1.4/kwh) for every TOU period. I don’t actually need an answer for this… just curious

Much thanks,
Brett

Paul Gilman

Hi Brett,

I guess my answer was not very clear. It has to do with how kWh are accumulated into TOU periods and credited to the next month's electricity bill. For a scenario with several TOU periods and one of the "Monthly total excess..." options, SAM has to determine how to credit kWh earned in one period to a different period in the following month when two consecutive months have different TOU periods. SAM arbitrarily uses 12 am, 6 am, 12 pm and 6 pm to determine how to assign the periods. In your case, credits earned in May during Period 4 are credited to Period 1 in June. Credits earned in May Period 5 are credited to June Period 3, May Period 5 to June Period 2, and May Period 6 to June Period 3. Because the excess kWh are determined by period (Excess for Period A = Sum of kWh Generated in Period A - Sum of Load in Period A), even though the buy rate is the same for all periods, the number of kWh credits for each period is different from the scenario with one period, so the \$ value of those credits is different.

Best regards,
Paul.

Brett K

Hi Paul

Ok, got it now:)I must say that SAM is an extremely useful program!

Thanks again for all your time and help!!!

Kind regards,
Brett

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