California grid operator opens doors for behind-the-meter batteries, distributed resources
A measure allowing behind-the-meter batteries to get paid during periods of electricity oversupply was among the measures approved by CAISO last week. Several of the changes are expected to assist with the integration of higher levels of renewable energy.
California has been a leader in deploying energy storage, including batteries on the customer side of the meter. And while the recent passage of a bill to extend the state’s Self Generation Incentive Program (SGIP) to 2025 is expected to give an ongoing boost to the distributed storage market, the state’s grid operator is also taking measures to compensate the services provided by batteries on the customer side of the meter.
Last Wednesday, the California Independent System Operator (CAISO) Board of Governors approved a package of four measures to assist the ability of behind-the-meter resources to participate in wholesale markets. This includes a new product which will enable behind-the-meter energy storage systems to get paid for charging during times of oversupply of electricity and negative pricing on the state’s wholesale market.
Battery systems on the utility side of the meter could already take advantage of negative pricing to charge, however this decision extends that advantage to customer-sited batteries, providing the ability to arbitrage electricity with an obvious economic benefit. For systems to participate in this program, they will have to be directly metered.
Another of the four measures regards changes to the bidding options that allow demand response to bid in ahead of time to participate in wholesale markets. The two new options approved by CAISO include hourly and 15-minute options, with notifications 52.5 and 22.5 minutes before operation.