The Value Proposition for Cost-Effective, Demand Responsive-Enabling, Nonresidential Lighting System Retrofits in California Buildings

Commercial lighting represents a significant potential source of demand response (DR) for the electrical grid, via traditional load shedding and rapid-dispatch (fast-DR) ancillary services when DR is enabled by networked lighting controls (NLCs). However, despite the significant opportunity and a regulatory push, DR-enabled lighting is installed in relatively few buildings because most building owners do not recognize its strong value proposition. Although NLCs can reduce energy bills, optimize facilities, and increase revenue, these co-benefits are not well quantified. This project analyzed lighting DR resources and energy-related co-benefits for commercial buildings in California. Using more than 100,000 individual hourly load profiles, the team forecasted the potential DR resources likely available from commercial lighting in 2025 and estimated revenues available from participation of these DR resources in energy markets. Combining these results with field-study estimates for NLC installation costs and energy savings provided a detailed accounting of site-level cost and energy-related co-benefits by building type from NLC’s DR enablement. In many cases, energy savings alone can deliver significant net value, justifying NLC DR-enabled adoption. Additionally, the study considers the sometimes-larger non-energy benefits (NEBs).
This report summarizes the team’s development of a framework to capture the high customer values from NLC non-energy benefits to drive DR adoption. More than 130 NLC case studies were reviewed to quantify NEBs and develop a benefits value intensity (BVI) model, which captures the NEB values for energy, building, people, and revenue. Generally, values in higher BVI categories can be several orders of magnitude higher than energy and demand management values alone. Armed with the quantitative NEB information and the high-influence market barriers and opportunities, the team designed a sample logic model and conceptualized five intervention strategies as part of the market transformation theory for achieving large-scale commercial lighting DR adoption.