The Distributed Energy Resources Customer Adoption Model (DER-CAM) is an economic and environmental model of customer DER adoption. This model has been in development at Berkeley Lab since 2000. The objective of the model is to minimize the cost of operating on-site generation and combined heat and power (CHP) systems, either for individual customer sites or a µGrid. In other words, the focus of this work is primarily economic. To achieve this objective, the following issues must be addressed:

  • Which is the lowest-cost combination of distributed generation technologies that a specific customer can install?
  • What is the appropriate level of installed capacity of these technologies that minimizes cost?
  • How should the installed capacity be operated so as to minimize the total customer energy bill?

It is assumed that the customer desires to install distributed generation to minimize the cost of energy consumed on site. Consequently, it should be possible to determine the technologies and capacity the customer is likely to install and to predict when the customer will be self-generating electricity and/ or transacting with the power grid, and likewise when purchasing fuel or using recovered heat.

How does DER-CAM work?

The DER-CAM model chooses which DG and/ or CHP technologies a customer should adopt and how that technology should be operated based on specific site load and price information, and performance data for available equipment options. The inputs to and outputs from DER-CAM are illustrated below.

Key inputs into the model are:

  1. customer’s end-use load profiles (typically for space heat, hot water, gas only, cooling, and electricity only)
  2. customer’s default electricity tariff, natural gas prices, and other relevant price data
  3. capital, operating and maintenance (O&M), and fuel costs of the various available technologies, together with the interest rate on customer investment
  4. basic physical characteristics of alternative generating, heat recovery and cooling technologies, including the thermal-electric ratio that determines how much residual heat is available as a function of generator electric output

Outputs to be determined by the optimization model are:

  1. capacities of DG and CHP technology or combination of technologies to be installed
  2. when and how much of the capacity installed will be running
  3. total cost of supplying the electric and heat loads.

The key assumptions are:

  1. Customer decisions are made based only on direct economic criteria. In other words, the only possible benefit is a reduction in the customer’s electricity bill.
  2. No deterioration in output or efficiency during the lifetime of the equipment is considered. Furthermore, start-up and other ramping constraints are not included.
  3. Reliability and power quality benefits, as well as economies of scale in O&M costs for multiple units of the same technology are not directly taken into account.
  4. Possible reliability or power quality improvements accruing to customers are not considered.


Simultaneous Optimization Approach:

The next figure shows a high-level schematic of the energy flow modeled in DER-CAM. Possible energy inputs to the site are solar insulation, utility electricity and natural gas. For a given DG investment decision, DER-CAM selects the optimal combination of utility purchase and on-site generation required to meet the site’s end-use loads at each time step. a) Electricity-only loads (e.g. lighting and office equipment) can only be met by electricity. b) Cooling loads can be met either by electricity or by heat (via absorption chiller). c) Hot water and space heating loads can be met either by recovered heat or by natural gas. d) Natural gas-only loads (e.g. mostly cooking) can only be met by natural gas.

Go directly to the free Distributed Energy Resources Web Optimization Service (WebOpt)