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Executive Summary

Electric power has historically been generated, transmitted, and distributed primarily as alternating current (AC) electricity. However, recent power technology trends have seen growth in direct current (DC) electricity generation, battery storage, and loads. These DC technology trends have sparked an interest in direct DC power distribution in buildings, mostly for potential energy efficiency benefits from fewer AC-DC power conversion steps.

This report assesses the potential benefits of direct DC power, focusing on energy efficiency, as well as the potential for these systems to enable wider use of automated demand response (ADR) and virtual power plants (VPPs). It also examines other co-benefits and standardization priorities to enable these benefits. A literature review shows energy use projections for direct DC power distribution ranged from a 25% savings to a 3% increase when compared with AC. These results are based primarily on models of residential and commercial building types, using representative, simplified building models with existing electricity consumption profiles in the United States. While certain building and system types could achieve the upper range of projected savings if designed and operated to maximize efficiency, it is unlikely that overall electricity use could be reduced by this amount because overall electricity usage characteristics do not match the best-case scenarios that showed the highest savings potential.

Two energy models were created for this report, assessing the national energy savings potential for both the residential sector and the commercial and institutional (C&I) sectors in Canada. The results show a 3% to 4% overall annual electric energy savings potential (14,000 GWh) for full DC power deployment by the year 2030, which is valued at approximately $2 billion at current rates. This represents a greenhouse gas (GHG) reduction potential of up to 1.7 MTCO2e per year, which would decline (or increase) along with any future changes to the emissions intensity of the grid.

The savings potential shown in these models could be increased in off-grid or grid-tied systems with higher usage of local DC generation (such as solar) and storage, and if systems were designed to optimize the design factors identified in this report to increase DC efficiency.

Conversely, the savings potential could be decreased due to factors that reduce the total electricity use by DC-beneficial equipment. These include higher efficiency building envelopes, increased heat recovery, and decreased deployment of equipment with high energy consumption, such as electric vehicles and heat pumps.

DC buildings, specifically those configured as DC microgrids, also present opportunities to increase ADR adoption. The use of load management in DC microgrids is essential for balancing loads, generation, and storage in backup power modes, and this can be adapted for ADR use with relatively low additional cost.

A key benefit of DC microgrids is the potential for low-cost backup power, providing resilience for essential functions such as heating, cooling, and refrigeration. Integrating solar power, electric vehicle batteries, and stationary batteries in a way that they can back up loads during grid outages is difficult with the current AC paradigm, which requires additional components and is subject to utility policies and restrictions to a much greater degree than DC-coupled systems.

Another significant benefit of DC microgrids is enabling increased deployment of distributed solar and storage when the AC grid reaches hosting capacity limits (the utility limits for generation and storage on specific feeders). Many utility feeders in Ontario have already reached these limits at relatively low levels of deployment. Although there are ways that AC-coupled solar and storage can be export-limited to allow for their increased deployment, these can be more costly and require significant utility oversight. DC microgrids can reduce both utility administrative burdens and barriers to renewable energy and storage deployment.

When considered together, the efficiency, ADR, resilience, and increased solar and storage deployment benefits |of DC microgrids provide a strong rationale for associated standardization and product development.

Recommendations

The main recommendations are as follows:

1. Prioritize standardization and product development for essential DC microgrid components (power conversion equipment, protective devices, microgrid controllers) and the following DC-connected equipment, which provides the highest combined DC efficiency, ADR, and resilience benefits:
   • heat pumps and air conditioners for space heating and cooling;
   • EV charging (including bidirectional charging);
   • energy storage;
   • heat pump water heaters; and
   • solar generation.
2. If additional resources are available for further standardization and product development, other equipment types with high-efficiency, ADR, or resilience benefits should also be considered. Prime candidates include data centre components, motor drives, refrigeration, commercial lighting, electronic devices, life safety systems, and heat pump clothes dryers.
3. Incorporate standardized ADR/load management features into DC microgrid controllers and DC-connected equipment.
4. Standardize DC microgrid controllers to act as ADR gateways for ADR-capable AC products like electric resistance space and water heating systems.
5. Provide guidance for efficient, resilient, ADR-capable, and cost-effective DC microgrid design, such as system design standards and reference designs.