Restructuring Roundtable – Energy Storage Recap & Takeaways
On Friday, December 9, the New England Electricity Restructuring Roundtable forum was abuzz with excitement and anticipation for the bright future of energy storage in Massachusetts and the Northeast. Two panels packed with trailblazing policy-makers and project developers gave attendees an overview of energy storage’s recent emergence and offered recommendations about policy mechanisms that will be needed to drive deployment to the next level. (Click here to access presentations from the forum).
Commissioner Judith Judson of the Massachusetts Department of Energy (DOER) offered an informative presentation on the State of Charge report and other recent DOER efforts. However, she made no indication about DOER’s thinking leading up to the December 31 deadline for deciding whether or not to set procurement targets for energy storage. Judson was joined by Carla Peterman, Commissioner of the California Public Utilities Commission (CPUC), who shared her experience and lessons learned with the CA storage procurement mandate, and Jesse Jenkins of the Massachusetts Institute of Technology, who provided an overview of energy storage from the perspective of MIT’s recently released Utility of the Future report.
The second panel of the session featured representatives from private-sector developers who are leading the charge on energy storage deployment, four of whom also happen to be NECEC members and partners: NEC Energy Solutions, Green Charge (an Engie Company), Deepwater Wind, and National Grid. Panelists offered a first-hand account of cutting-edge storage systems already online, such as NEC’s Sterling, MA project, and coming in the near future, like Deepwater’s South Fork, NY effort.
Here are some top takeaways from the presentations and ensuing discussions:
- Commissioner Judson affirmed that DOER’s modeling found there to be “tremendous benefit” to be captured from energy storage deployment;
- Dueling mottos were offered for energy storage:
- “Storage is as storage does,” – MA Commissioner Judson, channeling Forrest Gump
- “Storage is like bacon…it makes everything better!” – CA Commissioner Peterman;
- Judson also acknowledged that the status quo presents barriers to energy storage business models. New policies are needed to unlock value streams incremental to simple ‘charge at low prices, discharge at high prices’ arbitrage;
- Developers reported that the business-case for many storage projects revolves heavily around avoidance or reduction of peak demand costs, whether for seasonal capacity tags (e.g., by the Sterling Municipal Light Plant) or daily/monthly demand charges (e.g., by schools and other facilities being served by Green Charge in California);
- Co-location of storage with renewable generation units is also unlocking increased flexibility and renewable integration, as evidenced by Deepwater’s offshore wind-plus-storage project in Long Island and National Grid’s lithium/flow battery-plus-solar-and-wind demonstration projects in Shirley, Massachusetts;
- California is well under way towards a target of 1.325 gigawatts (GW) of energy storage by 2024, set back in 2013; the target has been very successful, driving 630 megawatts (MW) of storage to date;
- The CA target includes specific sub-category requirements for transmission-, distribution-, and customer-connected storage systems;
- All procurements under the target have been done through competitive RFO, with utilities allowed the latitude to shift small portions of the target across grid domains.
- MIT Utility of the Future report recommends including both locational value and time of use rates in any rate program for energy storage.
NECEC looks forward to more buzz and action around energy storage in 2017. Read NECEC’s comments, filed this month with DOER, on setting appropriate targets for viable and cost-effective energy storage systems.