How PEER Tests Microgrid Value and Shows if Your Smart City is Really Smart

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Another monster, grid-threatening storm is bearing down on the U.S. Northeast this week. If widespread electricity failures occur, analysts will once again try to figure out what power outages cost the economy, a way of pegging microgrid value.

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But there is another way to look at it – a more proactive approach. What’s the value of averting the power outages in the first place? And how does a town or city know it’s putting the right electrical infrastructure in place for the job?

That’s one of the topics to be discussed in Washington, D.C. this week as municipal leaders, utilities and others gather to learn about the growing smart city movement. The roadshow,  “Smart Cities Powered by Smart Grids” is being presented by Chicago-based S&C Electric in its role as a lead partner with the Smart Cities Council.

Among other things, the session will focus on a unique program known as PEER, which stands for Performance Excellence in Electricity Renewal. Offered by the U.S. Green Building Council, PEER assesses power project performance, much the way another council program, LEED, ranks green buildings.

Specifically, PEER provides utilities and project developers with a way to define, specify, and evaluate the worth of microgrids, campuses, municipalities, or zones within a utility service territory. In doing so, PEER also offers a way to bring credibility to a smart city project.

“How do you prove you are a smart city? Smart cities run on a smart grid. An easy way to see if you have a smart grid is to do a PEER assessment,” said David Chiesa, S&C Electric’s senior director of business development.

As a third-party ranking system, PEER can help smart cities reach energy goals and make continuous improvement. The program evaluates smart grid projects based on four criteria: Reliability and resiliency; energy efficiency and environment; operational effectiveness; and customer contribution.

Smart grid projects must meet certain requisites in the categories to receive PEER certification. In the ‘reliability and resiliency’ category, alone, evaluators rate more than 20 project characteristics, among them islanding ability, reliability metrics (SAIDI and SAIFI), redundancy and automation, communications backbone, and power surety for critical loads.

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David Chiesa, S&C Electric

Chiesa says he struggled with how to fully quantify microgrid value before coming upon PEER during its early conceptual phase. S&C, which focuses heavily on microgrids, smart cities and energy storage, now has made PEER an important part of its business model. The company helped develop the standards used for the program and was PEER’s first corporate sponsor. In addition, S&C employees are trained as PEER experts to evaluate projects using the scoring system.

The University of Texas at Austin, which houses one of the U.S.’ largest microgrids, has achieved PEER certification. Among its bragging rights, the university’s reliability exceeds both that of its local utility, Austin Energy, and the average for the U.S. grid, measured according to the Average Service Availability Index (ASAI).

The PEER evaluation found that the UT Austin microgrid offered other benefits, as well. For example, the microgrid reduced costs for electricity, energy, distribution and demand charges.

One of the first entities to win PEER certification was a public utility. In 2015, the designation went to the Electric Power Board, which serves about 177,000 customers in Chattanooga, Tennessee. Also a high performer on reliability metrics, the city installed smart grid technology that offers redundancy and automation, including smart switches and re-closers. The Lawrence Berkeley National Laboratory’s Interruption Cost Estimate Calculator puts savings from the improvements at $40 million a year.

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Have you used PEER to gauge microgrid value? Tell us about your experience in the comments below or on our LinkedIn Group, Microgrid Knowledge.

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About Elisa Wood

Elisa Wood is the chief editor of She has been writing about energy for more than three decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.