California continues to take a lead in the development of energy storage, with the state’s three energy organizations - California Independent System Operator (ISO), California Public Utilities Commission (CPUC), and California Energy Commission (CEC) – compiling the first storage roadmap.
The roadmap – the product of years of work and input from more than 400 interested parties – will take forward initiatives such as the recent storage mandate for 1,325MW of storage procurement by 2020. [Engerati-California's Energy Storage Mandate-Will Others Follow?]
“The roadmap is a foundation to integrate energy storage technologies that benefit grid reliability and consumers throughout the West,” said ISO CEO Steve Berberich.
Energy storage challenges
The roadmap was based on a consideration of 12 identified barriers to storage in the state. [Engerati-Draft California Roadmap Points Way To Addressing Storage Barriers] Broadly, these fall into three general categories:
• Expanding revenue opportunities for storage
• Reducing the costs of integrating and connecting storage to the grid
• Streamlining and spelling out policies and processes to increase certainty.
Of the issues communicated by stakeholders, they most frequently expressed the inability to accurately value energy storage for all the services it can provide, especially as evaluated by utilities in their procurement processes.
Two additional issues stand out with strong consensus for action. First, to clearly identify the need for flexible capacity and valuation of that capability in the CPUC resource adequacy program; and second to clarify tariff treatment of storage facilities, in particular between charging and discharging of electricity. Energy storage stakeholders also expressed the need for clarity of wholesale market treatment, including the application of the transmission access charge (TAC), available products, models, and rules to support their ability to build a business case.
However, less concern was expressed with the technical aspects of storage, such as standardized design and metering and telemetry requirements.
High priority actions
The roadmap identifies the highest priority actions (along with the responsible parties) as follows:
● Describe distribution grid operational needs and required resources characteristics (CPUC)
● Facilitate clarification by IOUs of operational constraints that can limit the ability to accommodate interconnection on the distribution system (CPUC)
● Examine and clarify opportunities for storage to defer or displace distribution upgrades (CPUC).
● Consider refinements to the valuation methodologies used by investor-owned utilities (IOUs) to support CPUC decisions on storage procurement and make models publicly available (CPUC, CEC)
● Clarify rules for energy storage qualification and counting in an evolving resource adequacy (RA) framework (CPUC)
● Consider “unbundling” flexible capacity RA counting (CPUC).
● Clarify wholesale rate treatment and ensure that the ISO tariff and applicable business practices manuals and other documentation provide sufficient information (ISO)
● Clarify and potentially modify net energy metering tariffs applicable to cases where energy storage is paired with renewable generators (CPUC).
● Clarify existing transmission and distribution interconnection processes, including developing integrated process flow charts and check lists (CPUC, ISO)
● Evaluate opportunities to coordinate between Rule 21 and Wholesale Distribution Access Tariff (WDAT) to streamline interconnection processes and ability to efficiently move between processes (CPUC, ISO)
● Evaluate the potential for a streamlined or ‘fast track’ distribution interconnection process for storage resources that meet certain use-case criteria (CPUC, ISO).
● Clarify existing ISO requirements, rules and market products for energy storage to participate in the ISO market (ISO)
● Identify gaps and potential changes or additions to existing ISO requirements, rules, market products and models (ISO)
● Where appropriate, expand options to current ISO requirements and rules for aggregations of distributed storage resources (ISO).
In addition, more than 20 medium and low priority actions are also identified for the organizations to undertake.
50% renewables by 2030?
While the roadmap is applicable specifically to California, it should nevertheless be of interest to other jurisdictions investigating the development of a storage market.
The roadmap is also timely, as California governor Jerry Brown has just upped the renewable energy challenge for California. In his inaugural address on January 5, Brown proposed that 50% of electricity should be derived from renewable sources by 2030 – up from the earlier target of one-third by 2020, which he noted the state was on track to achieving.
In addition, he proposed that by 2030 the efficiency of existing buildings should be doubled and heating fuels made cleaner, and today's petroleum use in cars and trucks be halved.
The target is not unexpected, and for example, studies have found that that California’s grid can support deep GHG emission reductions. [Engerati-California’s Future Grid Could Support Deep GHG Emissions Reductions]. However, how it will be implemented is still to be determined. But regardless of the route, energy storage will be a key component.