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N.Y. PSC Approves New Framework for State to Achieve Energy Storage Target

The New York State Public Service Commission on June 20 approved a new framework for the state to achieve six gigawatts of energy storage by 2030, which represents at least 20 percent of the peak electricity load of New York State.

The roadmap is a comprehensive set of recommendations to expand New York's energy storage programs to cost-effectively unlock the rapid growth of renewable energy across the state and bolster grid reliability and customer resilience, a news release from New York Gov. Kathleen Hochul noted.

The roadmap will support a buildout of storage deployments estimated to reduce projected future statewide electric system costs by nearly $2 billion.

In finalizing plans for the roadmap, the Department of Public Service staff and the New York State Energy Research and Development Authority assessed potential market reforms and cost-effective procurement mechanisms to achieve six gigawatts, and identified research and development needs to accelerate technology innovation, particularly for long duration storage.

The agencies also considered approaches to energy storage development in a way that advances the elimination of the state's most polluting fossil fuel power plants, as proposed by Governor Hochul in her 2022 State of the State address.

The roadmap kicks off programs toward procuring an additional 4.7 gigawatts of new storage projects across the bulk (large-scale), retail (community, commercial and industrial), and residential energy storage sectors in New York State.

These future procurements, combined with the 1.3 gigawatts of existing energy storage being procured or already under contract with the state and moving toward commercial operation, will allow the state to achieve the six-gigawatt goal by 2030.

Roadmap details include:

  • 3,000 megawatts of new bulk storage, enough to power approximately one million homes for up to four hours, to be procured through a new competitive Index Storage Credit mechanism, which is anticipated to provide long-term certainty to projects while maximizing savings for consumers;
  • 1,500 megawatts of new retail storage, enough to power approximately 500,000 homes for up to four hours, and 200 megawatts of new residential storage, enough to power 120,000 homes for up to two hours, to be supported through an expansion of NYSERDA's existing region-specific block incentive programs;
  • Utilization of at least 35 percent of program funding to support projects that deliver benefits to Disadvantaged Communities (DACs) and that target fossil fuel peaker plant emissions reductions, with program carve-outs for projects sited in the downstate region, given its high concentration of DACs and peaker plants;
  • Requiring electric utilities to study the potential of high-value energy storage projects toward providing cost-effective transmission and distribution services not currently available through existing markets;
  • Continued prioritization by existing programs on investing in research and development related to reliable long-duration energy storage technologies; and
  • Payment of prevailing wage as a programmatic requirement for energy storage projects with a capacity of one megawatt and above.

The New York PSC order is available on its website.

As of April 1, 2024, New York has awarded about $200 million to support approximately 396 megawatts of operating energy storage in the state.

There are more than 581 megawatts of additional energy storage under contract with the state and moving towards commercial operation.

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