Energy Portfolio Bidding for Cost Optimization
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Solution Overview
Problem
Determining the most cost-effective energy savings measures for buildings is challenging without knowing the cost to supply the energy needs after implementing these measures.
Innovation Solution
A method involving a computer-implemented process that conducts two sequential auctions: one for energy efficiency services, where vendors bid on avoided kilowatt hours, and another for energy supply needs, allowing for the determination of an optimal award schedule that satisfies both energy efficiency and supply requirements at the lowest cost.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Loss of energy
If energy savings measures are implemented without knowing the post-measure energy supply cost, then energy efficiency is improved, but the ability to determine cost-effectiveness deteriorates
Solution Approach 1:
The patent conducts the energy supply bidding process before the energy efficiency measures are implemented. This preliminary action allows the buyer to obtain cost information about future energy supply needs while the measures are still being evaluated, enabling informed decision-making about cost-effectiveness before commitment is required.
Solution Approach 2:
The patent divides the energy procurement process into two separate bidding processes: one for energy efficiency measures and another for energy supply needs. This segmentation allows independent evaluation and optimization of each component, with the ability to combine results to determine overall cost-effectiveness.
2Ease of operation
If a single bidding process is used for energy procurement, then the process is simple, but the ability to optimize total cost deteriorates
Solution Approach 1:
The patent segments the energy procurement into two distinct bidding processes: one for energy efficiency measures and another for energy supply. This allows each process to be optimized independently while maintaining overall cost optimization through the combination of results from both processes.
Data Source
AI summary
A computer-implemented method for determining an optimal award schedule for satisfaction of energy efficiency and energy supply requirements for a portfolio of one or more buildings. A first auction is conducted so as to receive over a computer network, from one or more prospective efficiency suppliers, a plurality of first bids for the provision of energy efficiency, each such first bid specifying an amount of energy saved and a cost. A computer is used to determine a schedule of remaining portfolio energy supply requirements that would remain after the provision of energy efficiency from at least a plurality of the first bids. A second auction is then run so as to receive over the computer network, from one or more prospective energy suppliers, one or more second bids for a plurality of the remaining portfolio energy supply requirements, each such second bid specifying a cost. A computer is then used to determine the lowest cost combination of a first bid and a second bid that satisfies the portfolio energy requirement.