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Sharing local energy infrastructure : organizational models for implementing microgrids and district energy systems in urban commercial districts

Rosie Sherman (MCP '12) argues that there is a growing trend in cities toward establishing localized, shared energy infrastructure. As existing energy infrastructure ages and demand increases, cities face rising energy costs and security risks combined with mandates to decrease carbon emissions. Local energy infrastructure provides cities and neighborhoods with greater control over their energy production and consumption, including the ability to lower the cost of energy, move to low-carbon energy technologies, and improve energy reliability and security. This thesis seeks to understand how stakeholders in urban commercial districts are creating organizations to implement two types of shared local energy infrastructure: district energy and microgrids. Building district energy and microgrids is a complex undertaking, which is one reason that they proliferate in urban environments where that complexity is reduced, such as universities, hospitals, and military bases. These areas may have single property owners, single land-owners or preexisting energy infrastructure that simplifies regulatory, legal, and development complexities of building new energy systems. Commercial businesses districts are significantly more complicated; they have multiple properties that abut public right of ways and that are owned by multiple, unaffiliated customers of legacy energy utilities. Establishing such a system in a commercial district requires addressing local utility rights, public right-of-way and franchise issues, as well as creating a new organizational structure that allows for the involvement of multiple parties in developing the system. This thesis assesses the feasibility of two organizational models for implementing local energy infrastructure in commercial districts: a joint cooperative model and an independent provider model. In a joint cooperative, all properties in a district become customers of a jointly owned, operated, and managed energy system. With an independent provider, all district properties become customers of an independently owned and operated system. These models are evaluated through two cases in which they are currently being tested: a proposed district energy system in Portland, Oregon and a proposed microgrid in Stamford, Connecticut. Therein, barriers to implementation such as perception of risk and lack of familiarity with shared energy systems are also examined.