Update on Energy Storage in the USA RSS Feed

Update on Energy Storage in the USA

What is the state of play for energy storage right now?

The energy storage industry is growing leaps and bounds, and opportunities for energy storage deployment are quickly opening across the country and around the world. Today, in the United States, we seem to be revising our projection estimates each quarter, anticipating even more deployments as markets and regulations are recognizing the value of energy storage systems. According to the US Energy Storage Monitor, deployment grew by more than 256 percent in 2015, and 2016 is on pace to be another record setting year in the U.S. alone. Markets across the globe are adopting cost-effective, reliable energy storage as well, with more than 2 gigawatts (GW) of new systems announced this year.

What are the main obstacles for broader energy storage deployment?

While energy storage is quickly advancing, historically these types of advanced energy systems have not been commonplace on the grid. This presents a number of challenges to overcome to ensure that storage systems have fair access to competitive markets and utility procurements. The two main obstacles are implementing regulations and market structures that account for storage systems operating parameters; and ensuring that competitive markets recognize the value that these systems provide and compensate performance and value delivered.

First and foremost, to be regulated is to be recognized, and even though systems are quickly going in around the country, most markets, integrated resource plans (IRPs), and utility procurements do not consider energy storage systems alongside traditional utility assets. Instead, we commonly see outmoded assets like peaker plants being procured without first considering multiple other solutions that are present and cost-effective today (energy storage, demand response, efficiency measures, etc.). ‘All-source’ RFPs – and IRPs that weigh storage side-by-side with other solutions – will drive innovative markets forward, encouraging regulators and decision makers to properly value the system-wide benefits that energy storage delivers.

When market and procurement consideration is given to energy storage, we must also make sure that we are properly valuing these systems and providing system owners compensation for the increased performance, resiliency, and flexibility delivered to the grid. In both short and long duration applications, storage systems enable us to operate the grid more efficiently and increases overall system reliability, saving money for utilities and ratepayers alike while improving overall system operations. But these savings and performance improvements, along with many other value streams that storage delivers, are not properly reflected in our markets and regulations.

The power sector is in the midst of immense transformation, and as we build the grid of the future we must ensure that we are enabling the deployment of advanced energy technologies through our competitive markets and regulations. We need to create markets that value this transformation to the flexible, resilient, and sustainable grid of the future.

What are the pros and cons of the top three energy storage technologies?

Energy storage defines a suite of technologies – batteries, flywheels, compressed air, thermal, flow batteries and more. While each of these systems may operate differently on the inside, their fundamental value is the ability to store energy when it is plentiful and utilize it when it is needed or most valuable to the grid.

Our grid is one of the longest supply chains in the world with very little storage capacity built in. We can stockpile fossil fuel, and some of our advanced hydroelectric facilities even run water uphill and back down again – but once energy is generated our ability to do anything other than consume it is very limited.

Storage systems make a more reliable electric grid possible, creating flexible, decentralized reserves of energy that can be tapped in to on demand. Faster-responding storage allows us to operate the grid more efficiently, instantly balancing fluctuating supply and dynamic demand. These systems are also used to defer and avoid costly investments in excess capacity and infrastructure that is currently needed to serve our nation’s growing peak loads.

Customer-sited energy storage enables homeowners and businesses to drastically lower their consumption while avoiding more expensive demand charges and time-of-use rates. Storage provides backup power and enables solar customers to generate on-site and consume their own energy even when the grid is down.

Through these various applications energy storage enables end-users to be partners in creating a more reliable and affordable electric grid, and means that utilities can deliver more sustainable energy from a more resilient system while adapting to the changing needs of businesses and homeowners.

Do you see the majority of storage being installed at the utility or at the end user site?

Currently, the largest application of energy storage system is at the utility scale, in major wholesale markets like PJM or MISO. These systems are being deployed for their performance, speed and accuracy, and are creating significant savings for grid operators and ratepayers for essential grid services. Many other utility applications – like capacity, infrastructure investment deferral, and peak demand reduction – are steadily growing as market opportunities as well.

Customer-sited systems (both commercial, industrial and residential) are rapidly advancing as a share of the overall market for energy storage. In fact, we project that by the end of the decade the capital expenditure for customer-sited storage systems will exceed that for grid-connected systems. This is due in part to the many valuable applications that can be performed as you move a storage system closer to the end-user load, and also the sheer number of potential customers for these smaller, distributed systems.

What states and utilities are leading energy storage deployment?

More than 20 states installed energy storage systems in 2015 as market rules and regulations come into place. New York, California, Hawaii and New Jersey have been quite significant thus far among state markets, while the PJM Interconnection wholesale markets has seen the lion’s share of energy storage system installation to date (covering multiple states in the East). Massachusetts in particular, as well as Washington, Oregon, Arizona and New Mexico have begun adopting policies that enable energy storage deployment – and many more are on the way. Additionally FERC and the remaining ISO/RTO markets are each seeking to address current regulatory barriers to adoption of advanced energy storage systems.

Read full article at Alt Energy Mag