We present a new structure function model to estimate the turbulence energy dissipation rate using lidar velocities. The model corrects for turbulence filtering due to the lidar probe volume by applying a Gaussian weighting function. By utilizing the high 3 m range-gate resolution of the BEAM 6x pulsed lidar, we achieve excellent agreement between turbulence energy dissipation rate values derived from lidar and sonic anemometer at three heights, with correlation coefficients exceeding 0.9.