DER & Finance Guide
DER Co-Optimization & Energy-as-a-Service
Two decisions make or break a distributed-energy project: how you co-optimize the assets against the tariff, and how you structure the deal. Here is how to do both.
Technology Overview
Distributed energy resources — solar, battery storage, thermal storage, CHP, and controllable loads — create value only when they are co-optimized against a real tariff. Sizing each asset in isolation leaves money on the table: the battery that shaves demand should also soak up the solar that would otherwise export at a low rate, while the CHP or thermal storage shifts thermal load off the electric peak. One dispatch engine, one tariff, all assets.
Once the physical system pencils out, the question becomes who owns it and how they get paid. Many commercial and industrial hosts do not want the capital on their balance sheet, which is where Energy-as-a-Service (EaaS) comes in — a third party owns and operates the assets and the host pays for the service. The contract structure decides how risk and reward are split.
There are four common structures. Energy concession(utility pass-through): the provider carries the host’s DER-reduced utility bill and the host pays a tariff on its own consumption plus a service fee. Capacity tolling: the offtaker pays a capacity charge ($/kW-month) plus a throughput charge ($/kWh) and supplies the energy. Shared-savings ESA: the host pays a share of measured bill savings, verified by M&V. On-site PPA: a $/kWh (or $/MMBtu for thermal) rate on the energy the asset delivers.
The CogenS™ platform runs one project-finance model for all of them — income statement, depreciation and taxes, after-tax cash flow, and KPIs (NPV, IRR, simple and discounted payback, benefit-cost ratio, and equivalent annual savings) — computed from both the building-owner (cost-of-ownership) and the provider (revenue) perspectives, with a dual-MARR solve that balances each party’s target return.
Module Specs at a Glance
DER Assets
Solar PV, battery storage, thermal energy storage, CHP, and controllable thermal load — co-optimized as one system.
Co-Optimization
A single dispatch engine minimizes energy cost across all assets against the real tariff, metering policy, and 8,760-hour load.
EaaS Structures
Energy concession (utility pass-through), capacity tolling, shared-savings ESA, and on-site PPA — each a distinct fee basis.
Perspectives
Building-owner (cost-of-ownership) and Energy-as-a-Service provider (revenue), plus the utility bill when the provider carries it.
Financial Model
One income-statement model: NPV, IRR, simple + discounted payback, benefit-cost ratio, and equivalent annual savings, with a dual-MARR solve.
Output
TEA report with a detailed financial model, per-structure fee breakdown, and cash-flow analysis.
How to Design a Project
A high-level workflow that mirrors how the CogenS™ platform structures the analysis end-to-end.
Model the load and tariff
Start with the 8,760-hour load and the real rate structure — energy, demand, fixed, and metering policy. This is the baseline the DER value is measured against.
Add the DER assets
Add solar, storage, thermal storage, and/or CHP. Enter the equipment specs and cost defaults; the platform prices CAPEX, O&M, incentives, and depreciation for each.
Co-optimize the dispatch
Run the dispatch to minimize total energy cost across all assets simultaneously — so the battery, solar, and thermal assets work together against demand charges, TOU spreads, and export rules.
Choose owner vs provider
Decide whether the host owns the assets (cost-of-ownership economics) or a third party provides them (EaaS). The platform computes both perspectives from the same physical dispatch.
Select an EaaS structure
Pick the contract: energy concession, capacity tolling, shared-savings ESA, or on-site PPA. Each has a different fee basis and risk allocation; the model solves the fee or rate that meets both parties' targets.
Solve returns and compare
Run the project-finance model with a dual-MARR solve, then compare structures and ownership models on NPV, IRR, payback, BCR, and equivalent annual savings to choose the deal that works for both sides.
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