Tendril Societal Test
While similar to a Total Resource Cost (TRC) Test and using essentially the same input variables, the Tendril Societal Test* includes the effects of change on external elements (e.g., environmental impact and national security), excludes tax credit benefits and uses a different (societal) discount rate. Rather than quantify the change in total resource costs solely to a energy service providers and its ratepayers, the Tendril Societal Test attempts to quantify the change in total resource costs to society as a whole.
Measured Benefits
The Tendril Societal Test captures benefits realized by avoiding environmental damage, transmission, distribution and generation costs, by increasing system reliability, via social programs (i.e., low-income programs), and by avoiding the costs associated with price volatility and risk management.
Measured Costs
Costs in this test reflect the costs to society of more expensive alternative resources; this test also omits tax credits by treating them as a transfer payment. When it comes to capital expenditures, the test considers interest payments a transfer payment. Capital costs are calculated in the year in which they occur, primarily because society actually expends those resources in the first year. The Tendril Societal Test uses a societal discount rate, and incorporates external costs of power generation that are not captured by the market system into marginal costs.
Test results
The Societal Test expresses results in terms of net present value and as a benefit-cost ratio; levelized costs are another method in which the test can deliver results.
* Reference: California Standard Practice Manual, October 2010