Utility Approach to Energy Storage

Posted on Posted in Master Metered Residential

Energy storage is a strange duck for utilities.  Is it load or generation?  What box should it be in and what should be required from an end customer that wants to install energy storage on-site?

The California Public Utilities Commission is trying to shed some light on the problem for utilities in the current Order Instituting Rulemaking (OIR) to implement Assembly Bill 2514, setting procurement targets for storage, R1012007.  However, there are no current guidelines for interconnection.  As a result, the utility engineers are struggling to understand how to incorporate storage systems on the local distribution line.

AES has highlighted this issue with their argument that storage is both load and generation.  John Zahurancik, VP at AES Energy Storage, recently presented a webinar with Navigant Research and made the point that a 2 MW storage system is actually a 4 MW resource because it can cycle over 2 MW “down” from a set point (charging) and 2 MW “up” (discharging).  The comparison is against a typical generator that would need to be sized at 4 MW to move 2 MW up and down.

US&R is currently working to install a 2 MW, 2 hour (4 MWH) system in Southern California Edison territory and we are working through these real-world issues.  The system is being installed under the Self Generation Incentive Rebate program and the rebate requirements rule out the export of power.  However, the utility engineers reviewing the interconnection believe they must account for the possibility of 2 MW of generator export.  In addition  they want to classify it as “intermittent” generation, like solar PV or wind.  Of course, this approach is completely opposite to the often discussed “smoothing” benefits of storage.  I feel for the engineers that must evaluate such a new technology under the existing “old” criteria, but storage is a disruptive technology and implementation requires new methods of evaluation.  After several years of planning, PG&E recently announced a 4 MW system has been installed at HGST, Inc., in San Jose.  Although not behind the meter, we hope that installations like this will lead to a more informed and facilitative approach by the utilities.

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