Page 86 - North American Clean Energy September October 2015

energy storage

The

Battle for

Batteries

Will centralized

or distributed

locations win?

by Jessica Harrison

ADVANCED ENERGY STORAGE has a number of useful applications resiliency, and now many end-users want solar-plus- customers may beneit from improved reliability,
and can be placed efectively throughout the grid. Storage
storage systems, storage for bill management, or short- energy bill management, or a share of the value stream
can support renewable integration at the bulk scale, on the term backup. In their primary roles, behind-the-meter, generated from load shifting.

distribution grid, and behind the meter. It can be operated by utility, and merchant-owned systems would not seem Storage holds huge potential as a reliability asset,
generators, distribution utilities, customers, or third parties. to compete. However, as customer and grid operations too. Studies by Texas utility, Oncor, noted the potential
However, more complex questions arise beyond the simple one blend, most notably, under “grid modernization” to add billions of dollars of storage to improve
of what storage can and should do; Where will it be placed?
eforts, applications begin to afect one another. For reliability on the Texas grid. Energy storage activities

Who will own it? And will centralized installations win over example, certain use cases for solar-plus-storage in New York are likely to increase due to the Reforming
decentralized?
systems could limit a growing need for ancillary the Energy Vision (REV) process, which created an
services to integrate renewables.
exception for utility-owned storage, in cases where the
How did we get here?
So why is location only coming up as a topic for devices are used to improve resiliency and reliability on

Historically, larger scale merchant operators have been the most consideration now? Part of the reason is that storage the grid.
active in deploying storage, such as with storage investments for applications have evolved over diferent timelines. Finally, the initial deployers of storage for ancillary
ancillary service provision in the wholesale market. Today, the For example, when advanced energy storage entered services and renewable integration are noting that
number and the types of investors and applications are growing. the wholesale market for ancillary services, market larger, more centralized systems may still be the better

We have seen renewable developers coupling devices with
operators and industry thought leaders saw their fast approach to leveraging the capabilities of storage to
large wind and solar for renewable integration, and merchant response capabilities as an advantage. In addition,
operate the grid more eiciently and efectively.
operation. Utilities are also using storage for reliability and
as drivers for clean air and clean energy technologies
started increasing adoption of large-scale renewables, Battle or cooperation?

storage emerged as something that could help manage On the surface, it may appear that each of the
large amounts of variable generation. As storage began stakeholder groups is looking to launch its own
to drop in price, solar PV developers began to pair the battle for the location and ownership of storage.

storage devices with their solar systems for commercial Certainly, solar developers and companies are going
and end-use applications.
to aggressively try to deploy packaged storage
hese initiatives, signiicant today, are beginning
technologies. And utilities, noting the value of storage
to push storage from the large-scale to the edge of
assets, will most likely investigate operating or

the grid. For these applications, the business case
investing in storage as well. Merchant operators, too,
is simple. Storage can optimize the solar asset and will look at leveraging their assets to capture potential
potentially provide backup, and additional revenue revenue from their storage systems.
opportunities for the user. Finally, as utilities and However, the drivers toward cooperative rather than

their regulators begin to understand the reliability and combative roles are even greater. Issues such as storage
resiliency beneits that advanced storage technologies safety, controls, or even navigating regulations and
ofer, they are placing storage on distribution systems policies which are required for devices to participate
to strengthen grid reliability, and defer capital in revenue roles (either upstream or downstream

expenditures. Today, storage, initially thought able
from the device’s location) are all powerful factors. In
to be placed “anywhere,” is now appearing to have the end, a combination of market forces -- including
primary applications “everywhere.”
new policies to accompany modernization plans, new
communication and control protocols that will need to

What is at stake today?
be created, and the sheer amount of the money that is
he question of where to locate storage is not simply on the table -- will drive stakeholders away from the
about engineering. It has both technical and economic battles of the past, and toward a more collaborative
implications. Whoever owns the storage and operates approach to connecting the devices across the grid.

the asset can inluence who reaps the revenue from it.
Some interesting conigurations are emerging. Jessica Harrison is the head
Developers on the customer side of the meter are of section for energy strategy,
forming plans to aggregate devices to perform multiple markets, and policy development

services, even creating business plans for entities such at DNV GL.
as YieldCos to leverage the capabilities and revenue
generating potential of storage. At the same time,
DNV GL | www.dnvgl.com

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