A new roadmap is recommending that New York offer $350 million in incentives to help reach a goal of adding 1,500 megawatts of energy storage by 2025. The roadmap outlines regulatory, market and policy changes that should be taken to get to the target.
The plan, released June 21, aims to jump start energy storage development in New York. It was developed by New York State Department of Public Service and New York State Energy Research and Development Authority staff with stakeholder input.
The plan focuses on customer-sited, distribution system and bulk system energy storage. Regulatory staff expects installed capacity to be divided roughly equally among the segments.
Staff estimates that adding 1,500 MW of storage will produce about $2 billion in benefits, including distribution system savings, reduced greenhouse gas emissions and improved grid resilience.
New York has about 60 MW of advanced energy storage capacity and about 500 MW in the development pipeline, according to the roadmap.
The New York Power Authority is currently working on several energy storage projects that demonstrate the value of the technology, which will continue to increase as the roadmap is implemented.
This work includes a partnership with the State University of New York on multiple projects that would allow the university system to utilize stored solar power during emergencies and times of peak energy demand.
A solar energy and battery storage system was completed this spring at the SUNY New Paltz campus. Planning is underway for a similar system at the SUNY Delhi campus.
The roadmap recommends that NYPA continue working with state and municipal customers, as well as at its own sites, to speed up energy storage adoption.
"The New York Power Authority is well positioned to help spur statewide deployment of energy storage applications needed to ensure New York's clean energy future,” said Gil Quiniones, NYPA President and CEO. “We are already leading by example -- acting as a catalyst for private sector investment and successfully implementing innovative energy storage projects across the state. Generating a pipeline of storage projects is key to building flexibility into the grid to better incorporate renewables and accelerate achievement of the state's 40 percent greenhouse gas reduction goals by 2030."
Recommendations to spur storage development
The roadmap offers various recommendations for spurring energy storage development, including offering $350 million in incentives to spur storage deployments. “Incentive levels should be aligned with declining storage costs to accelerate cost declines, spur innovation, and enable a self‐sustaining market without incentives,” the roadmap said.
The plan calls for improving retail delivery rates and programs like utility dynamic load management programs to send more accurate price signals that correspond to the system‐wide and locational value of cutting peak load and lowering financing barriers.
Also, utilities should be given a share of the cost savings enabled by energy storage as an incentive to support storage, according to the roadmap.
It suggests encouraging utilities to use energy storage in non-wires alternative projects that can delay the need for distribution and transmission investments by lowering peak demand.
New York should study all its little-used peaking power plants to see if any can be replaced with energy storage, which could reduce air emissions and lower costs, the roadmap said.
It recommends changes to wholesale market rules, which it said are major barriers to energy storage. Storage, for example, should be exempt from buyer-side market mitigation rules, according to the roadmap. “Exposing energy storage resources of any size to the potential of mitigation will lead to increased consumer costs and decreased system efficiency,” the roadmap said.
The New York Independent System Operator should encourage new wholesale market products or improve existing products to reward resources that are flexible and can respond quickly, according to the roadmap.
NYISO should also change its rules that are disincentives to pairing energy storage with utility-scale renewable resources, according to the roadmap.
Additionally, as proposed by Cuomo in his 2018 State of the State, NY Green Bank is seeking to invest at least $200 million in storage-related investments.
To support this commitment, NY Green Bank has released a Request for Information to solicit direct interest from project developers on how it can address financing gaps and support energy storage projects.
NY Green Bank is also expected to issue a request for proposals later this year for projects combining solar and energy storage.
Meanwhile, the DPS and NYSERDA are holding technical conferences on the roadmap and the New York Public Service Commission will take comments on it.
Late this year, the PSC plans to establish storage goals for 2030 and adopt enforceable deployment mechanisms to make sure the targets are reached.