On the use of time varying marginal and time varying average emissions factors in building energy analysis

Abstract

Calculation of greenhouse gas emissions from grid consumed electricity requires use of grid emissions intensity factors. In current building emissions regulations annual fixed factors are used, though there is growing recognition of the benefits of time-varying factors that take account of the varying emissions intensity as different generators ramp up/down. There are two main types of time varying emissions factors: marginal (MEF) and average (XEF) emissions intensity. Regulators seeking to draft policy around use of time varying emissions factors will need to evaluate the most appropriate methodology. Several studies in the scientific literature state MEF should be used to calculate savings from flexible demand strategies since it is the marginal generator that is the first to respond to small changes in demand. Here we suggest that XEF should in fact be the preferred approach in most scenarios. This recommendation is based on three factors; (i) alignment with historical emissions accounting methods; (ii) a more consistent basis from which to evaluate the alternative (baseline) scenario; and (iii) greater clarity over the incentive that it provides for investment in renewable generation. These factors are explored using examples and data from the Australian National Electricity Market.