Speakers at a recent energy storage summit held by Greentech Media provided an outlook on hybrid storage projects and detailed the dramatic growth seen in the U.S. residential storage market. Several public power storage projects were also highlighted at the summit.
The two-day summit took place in San Francisco in December and tackled a wide range of energy storage-related topics.
Daniel Finn-Foley, Senior Analyst, Energy Storage, Wood Mackenzie Power & Renewables, made a presentation at the summit in which he discussed the market for storage hybrids.
Finn-Foley said that within the U.S., there are 135 megawatts of front of the meter energy storage that is paired with solar. He said that six states including Puerto Rico have more than 10 megawatts of solar-paired storage currently installed.
Looking at the project pipeline, Finn-Foley said that eight states have almost 550 MW of solar-paired storage contracted or under direct procurement.
“This doesn’t take into account RFPs that are ongoing in utilities where they’re procuring renewables with the option of adding storage to those renewables,” he pointed out. Also, it doesn’t take into account interconnection queue requests that have solar plus storage put together.
“This is just contracted or procurement systems. The true number is an order of magnitude more than that over the next five years,” he said.
Finn-Foley said that by 2023, more than 60 percent of storage deployments in the U.S. will be paired with solar.
A number of public power utilities have pursued solar plus storage projects.
In early 2018, Sterling Municipal Light Department in Massachusetts signed a power purchase agreement for a community solar project paired with energy storage. The project developer, Origis Energy USA, says it is the first solar-plus-storage project in Massachusetts.
In September, the Colorado Springs Utilities board approved the addition of 150 megawatts of new solar generation plus battery storage to its system by 2024.
Finn-Foley said that wind plus storage involves “a much trickier economic business case to make.”
He said that total wind-charged storage deployments come in at around 74 MW. “We’re three to five years from scale for wind plus storage.”
Residential storage market seen growing to 3 GWh annually by 2023
Meanwhile, Brett Simon, Senior Analyst, Wood Mackenzie Power & Renewables, in a presentation at the summit said that Wood Mackenzie Power & Renewables is projecting the U.S. residential storage market to grow to 3 GWh annually by 2023.
“That’s 16x growth” between 2018 and 2023, he said, noting that there are a lot of factors underlying this projection.
Trends that he discussed in his presentation are only going to continue, Simon told summit attendees. “More net metering programs are either going to be removed or rolled back,” he said. “More time of use rates and residential demand charges are going to be instituted across the country.”
In addition, he said that residential storage systems are going to go down in price. “There’s a question of how quickly they will, but it is certain they will, it’s just a matter of how quickly.”
Also, there will be continued interest from utilities in leveraging these systems to provide grid services, Simon said. “We’re still in an early stage where’s there’s a lot of discussion about what distributed storage can do for the grid, but not a lot of examples where it has,” he said.
Simon said that as pilot programs underway by Liberty Utilities in New Hampshire, Green Mountain Power in Vermont and Xcel Energy in Colorado “are rolled out and we have clear answers to the question of what these systems can do, then there will be more opportunities to deploy ever larger aggregated fleets of batteries to provide grid value.”
Liberty Utilities in November reported that it had reached an agreement with the staff at the New Hampshire Public Utilities Commission, the Consumer Advocate, New Hampshire Sustainable Energy Association, Conservation Law Foundation, Acadia Center and the City of Lebanon for its home battery storage program.
According to Liberty Utilities, the pilot program is the first of its kind in the U.S. to combine battery storage with time-of-use rates. Liberty will introduce mid-peak, critical-peak and off-peak pricing. The installed batteries will be charged overnight during off-peak times and that power will be utilized during critical-peak times during the day. The off-peak rate is expected to be a savings of over 10 cents per kWh during the summer months compared to regular residential rates.
Meanwhile, there are more than 1,000 Tesla Powerwalls providing backup power in Green Mountain Power customers’ homes as part of a pilot program.
And Xcel Energy in 2018 released its 2019/2020 demand side management program and within that plan there was a proposal to have a residential storage pilot of 500 systems, which will be used to provide demand response on the grid. “Customers would receive both an upfront and a performance incentive for enrolling in the program and Xcel Energy has the ability to access up to 50 percent of the capacity of those systems to cut peak demand,” Simon noted.
2018 was a banner year for residential storage
Simon said that “2018 so far, has been massive for residential storage. In fact, we even had a few quarters that eclipsed all of 2017.”
In 2017, around 40 megawatt-hours of residential energy storage were installed in the U.S., he noted. In the second quarter of 2018, “we had 61 megawatt hours installed. That’s 1.5x more storage installed in one quarter than in the entire previous year.”
The third quarter of 2018 was similarly strong, “not quite as good as Q2, which was record setting, but still the second best single quarter for grid interactive residential storage since we at Wood Mackenzie Power & Renewables began tracking the U.S. residential storage market.”
The analyst noted that in 2016, residential storage was only 2 percent of total megawatts installed. In 2017, that number rose to 9 percent, but so far in 2018, the number is 38 percent.
Public power efforts
During the summit, efforts by public power utilities in the area of energy storage were also highlighted.
In his presentation on residential storage, Simon noted that public power utilities have been pursuing residential storage, specifically mentioning Arizona public power utility Salt River Project and Florida’s JEA.
SRP in 2018 initiated a program to support the installation and use of battery storage systems for its residential customers.
In late 2017, the board of directors for Florida-based public power utility JEA approved a battery storage incentive plan under which residential customers will be able to receive a one-time 30 percent rebate on the purchase and installation of a household battery system, up to a maximum of $2,000 per household. The battery rebate program is capped at $1 million per year.
Simon said that it is “exciting to see a utility in a state like Florida, where there isn’t really a clear economic case for storage by any means, to be trying to support this technology and think about what it can do and how they can encourage it on their system.”
Meanwhile, Jackie Sargent, general manager at public power utility Austin Energy in Texas, participated in a panel at the summit that looked at what cooperatives and public power utilities are doing in the storage arena.
Among other things, Sargent detailed the Austin Sustainable and Holistic Integration of Energy Storage and Solar Photovoltaics (SHINES) Project.
The Austin Energy SHINES Project was initiated in 2016 with a $4.3 million grant from the U.S. Department of Energy Solar Energy Technologies Office and a $1 million grant from the Texas Commission on Environmental Quality.
With Austin SHINES, the utility is testing the integration of solar power with energy storage through multiple customer-sited storage systems at the residential and commercial level, as well as two utility scale systems. All of these battery systems will be controlled through a centralized software management platform that determines when to utilize the stored energy. Through this project, Austin Energy is creating a virtual power plant by integrating distributed energy resources resulting in a cleaner, more dynamic, and more reliable electric grid.
As part of Austin SHINES, a 1.5 MW/3 MWh lithium-ion battery is co-located with the La Loma community solar farm in east Austin and a 1.75 MW/3.2 MWh lithium-ion battery system is being co-located in a neighborhood containing 2 MW of rooftop solar.
At the Greentech Media storage summit, Sargent said that “because we’re working with the Department of Energy and the TCEQ [Texas Commission on Environmental Quality], all the information that we acquire from this project is going to be made available to the public.”
So not only can “this be a roadmap for Austin to achieve storage goals, to create a cleaner grid for our community, but we see it as also” providing building blocks for other communities to follow Austin and do the same.