Storage Wars

Let the games begin in emerging branch of energy sector

With a year of drama behind it, the Federal Energy Regulatory Commission made its most important concrete decision of 2018 last week with unanimous approval of an order that facilitates energy storage’s role in wholesale power markets.

FERC’s final rule on the order, issued February 15 following a 5-0 approval vote, amends the commission’s previous regulations under the Federal Power Act (FPA) to remove barriers to the participation of electric storage resources in the capacity, energy, and ancillary service markets operated by RTOs (Regional Transmission Organizations) and ISOs (Independent System Operators).

“Specifically, we require each RTO and ISO to revise its tariff to establish a participation model consisting of market rules that, recognizing the physical and operational characteristics of electric storage resources, facilitates their participation in the RTO/ISO markets,” Order 841 reads.

These participation models—which FERC gave RTOs and ISOs nine months to file and another year to implement—call for five main requirements in order to jump in to the energy storage market, as summarized by Utility Dive’s Peter Maloney:

  • Ensure that a storage resource can provide all the services it is technically capable of providing,
  • Ensure that an energy storage resource can be dispatched and can set market clearing prices as both a buyer and a seller,
  • Account for the physical and operational characteristics of storage resources through bidding parameters or other means,
  • Establish a minimum size for participation in RTO/ISO markets that does not exceed 100 kW, and
  • Specify that the sale of electricity from the RTO/ISO markets to a storage resource that the resource resells must be at the wholesale locational marginal price

It remains to be seen whether FERC’s decision will be affected by recently proposed budget cuts to the EPA. The organizations are separate entities, but intersect on matters of renewable energy integration to the grid and power distribution. Energy storage, in particular, is an important emerging branch of the renewable energy sector.

Following the FERC ruling—and perhaps in response to it—at least one major company heightened its emphasis on energy storage. General Electric clarified part of the major restructuring plan it released at the end of 2017 by adding a new internal energy storage unit within GE Power. The new unit combines some personnel from GE’s Current business unit and microgrid experts from rail company Alstom, which GE acquired in 2015. In the new structure, the new GE unit will have a tighter focus on commercial and industrial customers. GE’s December overhaul divided the company into three primary areas of focus: healthcare, aviation and power generation.

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Trackbacks/Pingbacks

  1. Storage Wars: ‘A’ List | Electrical Apparatus Magazine - March 29, 2018

    […] of homes. Residential storage is on the rise—especially since a recent FERC ruling—with multiple companies developing systems. “While residential storage has most traditionally been in the form of off-grid system, GTM […]

  2. Battery Breakthrough | Electrical Apparatus Magazine - September 27, 2018

    […] Lithium-ion batteries have a bold new challenger in the emerging energy storage market. During the One Planet Summit in New York City Wednesday, Patrick Soon-Shiong, chairman of NantEnergy and founder of that company’s research arm NantWorks, proclaimed a breakthrough in battery storage. Soon-Shiong unveiled that newly cultivated zinc-powered batteries may be an even more useful alternative. He noted that these “green, air-breathing batteries” avoid lithium and cobalt, replace diesel and lead-acid batteries, and present no risk of fire or environmental contamination. […]

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