Benefit Cost Analysis of Electrification of Urban Districts: Case Study of Philadelphia, Pennsylvania

Abstract

In this paper, the results of a feasibility analysis are summarized to assess the energy, economic, and environmental benefits of electrification and renewable energy integration for an urban district of Old City, Philadelphia, Pennsylvania. First, the energy demand for the district is reduced through the implementation of cost-effective energy efficiency measures (EEMs) appropriate for Philadelphia’s climate. Then, a combination of distributed generation (DG) systems including wind, photovoltaics, and hydropower is evaluated to determine optimized hybrid systems that meet the energy demand of non-electrified and electrified districts. The analysis indicates that the implementation of common and proven EEMs to all the district buildings can reduce its annual energy consumption and CO2 emissions by 13% and 13.8%, respectively. These EEMs are estimated to be cost-effective based on the current electricity price of $0.082/kWh offered by Philadelphia’s utility, Philadelphia Electric Company (PECO). Through cost optimization analysis, a hybrid DG system combining wind and hydropower connected to the grid is found to lower the cost of energy for the non-electrified district to $0.007/kWh, lower than the current PECO rate, with the added benefit to lower carbon emissions by 10%. Moreover, the analysis considered the case of an electrified district which reduces life cycle costs by 3.5%. By implementing electrification and EEMs, the electricity usage decreases by 14% and peak demand by 19.5% as well as CO2 emissions by 18%. Through cost optimization to design a hybrid DG system that can meet energy demands of the electrified district, wind and hydropower connected to the grid is found to achieve a cost of energy of $0.008/kWh and carbon emissions reduction of 34.9%.