Grid Scale Energy Storage: Developing Business Cases

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Grid Scale Energy Storage: Developing Business Cases IMRE GYUK, DIRECTOR, ENERGY STORAGE RESEARCH, DOE-OE EnergyExchange, Tampa 07 16-17

Energy Storage provides Energy when it is needed just as Transmission provides Energy where it is needed

The grid has become stochastic! WIND EV FOSSIL STORAGE LOAD SOLAR PV ROOFTOP PV

Storage Economics: The Cost of a Storage System depends on the Storage Device, the Power Electronics, and the Balance of Plant The Value of a Storage System depends on Multiple Benefit Streams, both monetized and unmonetized LCOE depends on Application! Power Electronics 20-25% Energy Storage Device 25-50% Facility 20-25% Arbitrage Frequ. Reg. Dem. Charges month, year Resiliency

Frequency Regulation

ARRA Project Beacon Hazleton, PA. 20MW Frequency Regulation for PJM. Commissioned Aug. 2014 $K 5,936/year potential revenue R. Byrne, SAND 2016-1080C This project provided the basis for FERC to establish PAY FOR PERFORMANCE! ARRA Duke Energy / Younicos With 153MW Wind at No-Trees, TX 36MW / 40 min battery plant Smoothing, Frequency Regulation Commissioned March 2013

Regulation with Storage is 2 times as effective!! 2013: FERC s Order 755 Mandated Pay for Performance Frequency Regulation using Energy Storage is now a Commercially viable Business in FERC compliant Regions! 1999-2011, PJM utilities spent 48.8 cents per MW of load on frequency regulation 2012-2016, PJM utilities spent 24.4 cents per MW of load on frequency regulation (SE Energy News 2016/11/28)

ARRA - Southern California Edison / LG Chem Li-Ion: 8 MW / 4 hr battery plant for wind integration at Tehachapi, CA. Tehachapi: 4,500MW Wind by 2015! Commissioned: Sept. 2014 Integrator: ABB 8MW / 32MWh Storage Plant

Energy Storage Systems for Peakshaving, Loadshifting, Ramping 6 October 2013: California PUC sets target of 1.3GW of Storage by 2020

Energy Storage for Resilience Every $1 on protection measurements Can prevent $4 in repairs after a storm! Trends indicate the situation will get worse not better!!

Vermont Public Service Dept. DOE - Green Mountain Power Joint Solicitation issued by VPS/OE Rutland, VT 4MW / 3.4MWh of storage Integrated with 2MW PV Integrator: Dynapower Groundbreaking: Aug. 12, 2014 Commissioning: Sep. 15, 2015 System can be islanded to provide emergency power for a resilient microgrid serving a highschool / emergency center. Storage: Ancillary grid services, demand charge reduction PV: Green power for the grid. Situated on Brown Field area Referenced as model in VT Energy Strategic Plan! New projects planned. Testimony to VT Senate. Bill on Storage Initiative passed.

How to make the Microgrid Pay for itself: Regional Network Service (RNS): Payments for using transmission lines depend on monthly peak load. Forward capacity market (FCM): Payments for regional capacity reserves to cover load excursions depend on the yearly peak day/hour identified by ISO-NE, In addition, there are financial benefits from frequency regulation and arbitrage. Capturing the yearly peak, $200,000 from PV and storage!

Sterling, MA: Microgrid/Storage Project Sterling, MA, October 2016 Sterling, MA, December 2016 Sterling Municipal Light Department. $1.5M Grant from MA Community Clean Energy Resiliency Initiative (Dept. of Energy Resources). DOE/Sandia. Clean Energy Group. 2MW/2hr storage with existing 3.4 MW PV to provide resiliency for Police HQ and Dispatch Center. Li-ion batteries provided by NEC.

Storage Economics in Action! Capital cost: $1.7M/MW simple payback: 6.7 years R. Byrne, Sandia 2016 December 2017 Feb, March 2017 Apr, May 2017 June (annual)!! 2017 July S. Hamilton, Sterling

Energy Storage Procurement, Guidance Document for Municipalities Dan Borneo (Sandia) Specific examples of the elements that should be included in a solicitation for the procurement and installation of a battery energy storage project designed to provide backup power during outages and facilitate timely cost recovery. www.sandia.gov/ess SAND 2016-8544 2017 GTM Grid Edge Award!

Other DOE-OE Storage Projects: Eugene, OR, Water & Energy Board Resiliency Microgrid 500kW Storage + 125kW PV + Diesel gen sets at 2 aggregated sites Cordova, AK, Study with ACEP Hydropower Smoothing Kona, HI, with NELHA and HELCO Enabling more solar PV 100kW/500kWh of V/V Batteries Orca Island with OPALCO WA Clean Energy Fund 500kW/4 hour V/V system for resilience

The Bigger Picture

Grid Energy Storage Safety Initiative DOE identified Validated Safety as a critical need for the success of grid energy storage. The ability to validate the safety of energy storage systems will: Decrease human and financial risk, Minimize installation costs, Accelerate acceptance of new technologies. To address this need DOE is engaging key energy storage stakeholders: DOE OE Energy Storage Safety Workshop, February 2014 PNNL Publication: Inventory of Codes and Standards Strategic Energy Storage Safety Plan December 2014 Established 3 ES Safety Working Groups March 201 DOE OE Energy Storage Safety Workshop, February 2016

Energy Storage Equitable Regulatory Environment Reducing institutional and regulatory hurdles for energy storage to provide an environment where the opportunities for deployment and the services provided by energy storage are recognized, implemented and appropriately valued requires coordination across federal, state and municipal entities Hosted regional Pacific Northwest utility regulatory commission workshop on energy storage with commissioners and staff from WA, OR, ID, and MT. Hosted Southwest regional utility regulatory commission workshop (May 4 th, 2016) with NM, UT, AZ, CO, NV PUC s. With support from NARUC, Provided information to WA, OR, CA, and MA commissions on valuation of energy storage assets. Supporting plenary dockets on energy storage initiated by the Washington UTC and the Oregon PUC. Supported CA-ISO in review of storage market rules. DOE OE-VT efforts lauded as model for federal-state engagements in VT Strategic Energy Plan. 19 19

Energy Storage Technology Advancement Partnership ESTAP Regular Webinars In collaboration with CESA http://cesa.org/projects/energy-storage-technology-advancementpartnership/energy-storage-events/

DOE International Energy Storage Data Base energystorageexchange.org supported by Strategen Over 1550 energy storage projects from 60+ countries. 50 energy storage technologies are represented Partnerships with Australian Energy Storage Alliance Policy Database in Development Partnership with EIA on Storage Reporting

Annual U.S. Energy Storage Deployments, 2012-2021 GTM Research / ESA U.S. Energy Storage Monitor

U.S. Energy and Employment Report, January 2017 T&D Employment by Transmission, Distribution, and Storage Technologies Q1 2016

With new Technologies Cost will go down, Safety and Reliability will increase With every successful Project the Value Propositions will continue to increase! More jobs will be created!!