Customer-Owned Back-Up Generators for Energy Management by Distribution Utilities

This paper develops a quantification of the most important benefits brought about by the systematic operation of customer-owned back-up generators by distribution utilities or load-serving entities. The back-up reciprocating or internal combustion engine is the most widespread form of distributed generation, demonstrating high penetration levels in commercial and industrial areas. If the load-serving entity can oversee the operation of some of these units during strategic hours, important benefits can be realized, not only for the utility, but also for the owner of the unit and the society in general as shown in the results. The most important benefits of this coordinated operation are identified and quantified, using real cost data and pricing from a real North American electricity market.