The methodology used in the 2006 GPRA assessment is described within a document entitled, "R&D Program Benefits Estimation" (PDF 2.7 MB) (dated December 4, 2006).

In the 2006 assessment, which is used to develop the FY 2008 budget, OE used NEMS for determining quantitative estimates relating to economic and environmental benefits. However, potential OE benefits from improvements to electric system reliability, and infrastructure security - two of the primary aims of OE activities - were not analyzed using NEMS or using the Market Allocation (MARKAL) model because large-scale, integrated national energy models do not have the level of geographic and temporal detail needed to evaluate electric reliability and infrastructure security benefits properly. Instead, an approach involving empirical data and expert panels was used to assess these potential benefits, as shown in the "Understanding the Cost of Power Interruptions to U.S. Electricity Consumers" (PDF 377 KB) and in Table 4-2 below. OE is continuing to assess the impact of power outages, frequency and voltage disturbances, and transmission congestion on costs to society.

Table 4-2. Summary of Reliability and Infrastructure Security Benefits of OE's Programs - for FY2008 Budget Request

	Outages ($ billions)		Power Quality Events ($ billions)		Trans- mission Congestion ($ billions)		Total Reliability ($ billions)		Risk of Attack or Destruction (%)		Mitigating Damage with Supply (%)		Mitigating Damage with Demand Response (%)		Total Infrastruc- ture Security Improve- ment
	2020	2030	2020	2030	2020	2030	2020	2030	2020	2030	2020	2030	2020	2030	2020	2030
DSI	1.9	5.3	0.51	1.6	0.03	0.09	2.4	7.0	2.0	5.0	2.0	3.0	1.0	2.0	5%	10%
HTS	1.9	5.3	0.29	1.3	0.01	0.07	2.2	6.7	2.0	3.0	2.0	4.0	2.0	5.0	6%	12%
ES&PE	2.8	4.3	1.0	1.7	0.05	0.09	3.9	6.1	4.5	4.0	5.0	8.5	2.0	4.0	11%	16%
V&C	9.5	11	1.1	1.6	0.07	0.07	11	12	10	10	10	7.5	10	7.5	28%	24%

The methodology used in 2007 followed the same approach, except improvements in reliability and security were not determined. Table 1 shows the net national benefits that would result by funding two of OE's R&D programs, the High-Temperature Superconductivity (HTS) and the Renewable and Distributed Systems Integration (RDSI) programs, at the requested FY09 budget level. The results in Table 1 show the net benefit to the nation, as compared to not funding these programs.

Table 1. Estimated Benefits of the HTS and RDSI Programs (using NEMS)

The results may be interpreted, as follows:

• HTS technologies result in a reduction of electricity consumption and lowered energy losses compared to technologies used in conventional transmission and distribution lines. The net effect is to lessen the need to build electricity generation capacity, which in turn reduces industry expenditures, as well as electricity prices to consumers. Also, a diminished need for electricity translates into lower usage of fossil fuels with a concomitant reduction in carbon emissions. The NEMS analysis determined that the HTS program could result in a cumulative savings of carbon dioxide emissions of 221.2 million metric tons by the year 2030, representing about 3.4% of the total savings offered by the entire technology portfolio.
   
• The RDSI activities reduce the need for both electric generation capacity and also transmission and distribution infrastructure, due to its impact on peak load reductions. The NEMS results indicated that the RDSI program contributed to about two-thirds of the total consumer and industry savings (when compared to the overall OE portfolio). Natural gas imports were also reduced due to less dependence on natural gas generation during peak hours, with the RDSI program contributing to most of this effect.

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