Cash-neutral avoided energy price calculator

Verified energy and demand savings must cover annual debt service and added operation cost to avoid negative retained cash. Solving that cash balance gives the required marginal energy price.

p_{\text{min}} = \frac{D + \mathrm{OM} - S_{\text{demand}}}{E_{\text{verified}}}

Calculator

Enter the values you know and leave one box empty. Calculate finds the empty one, the result or any input.

Worked example

Given

$D$ = 60,000 $/yr
$\mathrm{OM}$ = 5,000 $/yr
$S_{\text{demand}}$ = 15,000 $/yr
$E_{\text{verified}}$ = 400,000 kWh/yr

p_{\text{min}} = \frac{60{,}000 + 5000 - 15{,}000}{400{,}000} = 0.125

Symbols and units

Symbol	Meaning	Unit
$p_{\text{min}}$	minimum avoided energy price for zero retained cash	$/kWh
$D$	annual owner debt service	$/yr
$\mathrm{OM}$	incremental annual operation cost	$/yr
$S_{\text{demand}}$	independently credited annual demand saving	$/yr
$E_{\text{verified}}$	verified annual avoided electricity	kWh/yr

Related calculators

Results are estimates for study and screening. Check the inputs, units and assumptions before you use them for design, billing or contract decisions.