Maryland Passes Energy Storage Tax Credit

on April 14, 2017

power magazineMaryland on April 10 became the first state in the nation to pass legislation enacting a tax credit for residential and commercial energy storage installations.

The measure passed unanimously in the state Senate, and with a 101–11 vote in the House. Gov. Larry Hogan (R) is expected to sign SB 758 into law.

The bill offers up to $5,000 for residential installations, $150,000 for commercial installations, or 30% of the total cost of installations. Credits can only be claimed for systems installed between January 2018 and December 2022. The tax credit applies to all energy storage technologies.

Earlier this week, Maryland also passed HB 773, which calls for an energy storage technology study to determine how Maryland can use energy storage to open the path to a more reliable electric system.

According to the Energy Storage Association, in 2016, commercial deployment of energy storage systems grew more than 100% over the previous year and installed system costs plummeted another 30%.

A series of states have recently implemented measures that will boost energy storage installations. California, which enacted a mandate in 2014, requires utilities to procure 1,325 MW of energy storage by 2020. Oregon’s Public Utility Commission earlier this year issued guidelines under the 2015-enacted HB 2193, a law that requires Oregon utilities Portland General Electric and PacifiCorp to have a minimum of 5 MWh of energy storage in service by January 2020.

Massachusetts, in August 2016, meanwhile, became the third U.S. state to enact an energy storage mandate, though the exact volume that must be procured by January 2020 won’t be decided by the state Department of Energy Resources until this summer.

New York City in September 2016 unveiled the first citywide mandate, aiming for an energy storage goal of 100 MWh by 2020. Hawaii, which recently passed a 100% by 2045 renewable energy mandate, saw its state legislature introduce bills on energy storage tax credits and infrastructure loans.

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Power MagazineMaryland Passes Energy Storage Tax Credit

Old Coal Mines Could Have A Future In Green Energy Storage

on April 14, 2017

forbesEnergiewende (energy transition). That’s the name of the German government’s ambitious goal to transform their energy landscape over the next few decades. By 2025, they want 35-40% of their electricity to come from renewable energy sources. By 2035, they’re targeting 55-60%. And by 2050, they hope to hit at least 80% renewable energy, coupled with an overall reduction in energy consumption of 25% (compared to 2008).

To get anywhere near this goal requires a huge investment in wind and solar energy generation, as well as a step up in their use of biomass and hydropower, and improving the overall efficiency of natural gas power plants. So far, signs are good, at least in terms of their energy mix. In 2015, renewable energy made up 32.5% of Germany’s total electricity demand.  On one day in 2016, renewable technologies generated 55 GW of energy – that was 87% of Germany’s electricity demand on that day. As reported in Quartz at the time, there was so much electricity available, “Power prices actually went negative for several hours, meaning commercial customers were being paid to consume electricity.”

Alongside the environmental argument for renewables, there are also economic reasons a region might want to move away from coal and oil. A 2015 report from Bloomberg New Energy Finance showed that in Germany, coal and gas were more expensive than onshore wind – $106 and $118 versus $80/MWh – and the same was true in the UK. In China, coal was still cheap in 2015, coming in at just $44/MWh. But solar power there was cheaper than gas ($109 versus $113/MWh). With China now taking a leading role in the fight against climate change, the prices of renewables are likely to drop further.

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ForbesOld Coal Mines Could Have A Future In Green Energy Storage

Vermont bill would direct PUC to draw up energy storage recommendations

on April 13, 2017

energy storage utility diveVermont’s new Republican governor has said he supports the state’s 90%-by-2050 renewable portfolio standard. But moving to that goal could require energy storage to offset the intermittency of resources such as wind and solar power.

Vermont utility Green Mountain Power was also an early adopter of residential storage, teaming up with Tesla to offer some customers residential batteries.

But unlike neighboring Massachusetts, Vermont is not working on developing an energy storage mandate. 

The bill in the state legislature could be a first step in that direction.

“I started this with a genuine curiosity,” Sibilia, the bill’s sponsor, told the Rutland Herald. “As we’ve taken more and more testimony, I’ve gotten more and more excited and also concerned. I want to make sure we don’t get too far behind our neighbors.”

Sibilla introduced the bill March 17 and it currently resides in the Committee on Energy and Technology. The Vermont legislative session ends May 16, but VT Digger reports lawmakers could adjourn a week early due to broad consensus over the budget, the only must-pass bill of the year.

 

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Utility DiveVermont bill would direct PUC to draw up energy storage recommendations

Analysis: Energy Storage Projects – An increasingly attractive investment opportunity?

on April 13, 2017

lexologyThe results of the National Grid’s Enhanced Frequency Response (EFR) tender published in August 2016 have come to be seen as something of a pivotal moment for the fortunes of energy storage in the UK – especially for battery technology.

The statistics will be familiar to many: 61 of the 64 EFR bids related to the use of battery storage, offering over 4311MW of capacity, and battery solutions dominated the 200MW of capacity accepted by theNational Grid. “Battery storage” and “energy storage” are used increasingly interchangeably.

One successful bidder (and the only bidder to be awarded two EFR contracts) was Low Carbon, which was awarded contracts for 50MW of capacity. On 1 March 2017, Low Carbon announced that it was forming a joint venture – VLC Energy – to exploit the commercial opportunity presented by EFR contracts.

The announcement catches the eye because Low Carbon’s joint venture partner, VPI Immingham, is owned by the oil trading giant Vitol group. In addition to battery storage dominating the EFR tender and commercially “coming of age”, was this also the moment when the business case of a “green and clean” project became commercially viable without Government subsidy?

Of course, Vitol is not alone when it comes to oil companies investing in renewables. Statoil, Royal Dutch Shell, Total and Aramco each announced the making of investments in the renewable energy market in 2016. Total is reported to have acquired a 90% stake in battery designer Safte Group, building on earlier acquisitions in the solar sub-sector.

These investments are significant, but represent only 2% of net operating income for Statoil, Royal Dutch Shell and Total. Aramco’s CEO said recently that oil and gas will continue to play a significant role in the future energy mix for decades to come. Oil remains the staple product of core business of these energy giants.

The investments in batteries and battery projects do however demonstrate that project sponsors are developing business cases which are credible investments in their own right, or at least worthy of early adopter speculative investment. Evidence of early adopter behaviour is positive as it suggests there is optimism that there will be a market in the near to medium term.

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LexologyAnalysis: Energy Storage Projects – An increasingly attractive investment opportunity?

Is battery energy storage at a ‘turning point’ for US utilities?

on April 13, 2017

energy storage utility diveIn a famous children’s fable, a stuffed rabbit becomes real when its owner believes in it.

The nation’s utilities may now be similarly transforming battery energy storage.

The U.S. utility-scale battery storage installed capacity grew by another 221 MW in 2016 as costs continued to drop, according to a recent report from GTM Research and the Energy Storage Association.

More importantly, the sector last year doubled the amount of megawatt-hours (MWh) of battery capacity deployed compared to 2015.

This, analysts say, shows growth in the use of long-duration batteries and an increased confidence that the large energy storage facilities can be used to help manage peak demand.

“Growth remains steady, but 2016 was a turning point because the PJM frequency regulation market faded while demand for 4-hour duration storage capacity grew,” said report co-author Dan Finn-Foley, a GTM Research senior energy storage analyst.

The longer duration capacity growth was largely from California battery storage projects, Finn-Foley said. They were brought online in 2016 to address power grid needs created by the shutdown of the Aliso Canyon natural gas storage facility due to a methane leak in 2015.

Those batteries were rushed online to provide peak demand electricity that local power plants could not supply without natural gas from the Aliso Canyon facility. They represented 60 MW of the 221 MW added last year, but accounted for 168 MWh of the total 336 MWh deployed in 2016, according to Finn-Foley.

“With a 4-hour duration battery, a 20 MW energy storage system can deliver 80 MWh of capacity to meet a peak demand spike,” he said.

The fast deployment of those California grid-scale batteries — all sited, constructed and put into operation in nine months — has a number of analysts and sector insiders touting 2016 as a “turning point” for energy storage. But other say the true storage revelation is yet to occur as utilities discover how to better capture the multiple values of storage.

“The watershed event for energy storage will be when we can unlock multiple value streams from batteries,” said Stuart Laval, director of technology development at Duke Energy.

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Utility DiveIs battery energy storage at a ‘turning point’ for US utilities?

California’s US$270m self-generation scheme favouring energy storage set to reopen

on April 12, 2017

Energy Storage NewsCalifornia’s Self-Generation Incentive Program (SGIP), the scheme to incentivise the use of distributed energy, opens for applications at the beginning of next month, weighted to favour energy storage.

When it comes to solar, SGIP has previously been a success in the US state and is administered by the utilities Pacific Gas & Electric (PG&E), Southern California Edison (SCE) and Southern California Gas Company (SoCal Gas) as well as the Center for Sustainable Energy.

The programme awards “financial incentives for the installation of new qualifying technologies that are installed to meet all or a portion of the electric energy needs of a facility”. Through to the end of 2019 a total of US$270,165,000 will be made available through SGIP to the programme administrators: just over US$117 million for PG&E, US$91 million for SCE, just under US$36 million for the Center for Sustainable Energy and US$26 million for SoCal Gas.

The biggest change to SGIP is that as of this year, 75% of funds will be allocated to energy storage technologies, and just 25% for generation technologies. Residential energy storage projects of less than 10kW will comprise 15% of the energy storage portion. When the intended budget allocation was announced last summer, GTM Research head of energy storage Ravi Manghani called it a “big win” for the energy storage industry.

The programme opens for formal applications on 1 May 2017. For residential systems smaller than 10kW and systems larger than 10kW that do not take the Investment Tax Credit (ITC), incentive levels are set at US$0.50 per watt-hour. Projects larger than 10kW that take the ITC will receive US$0.36 per watt-hour. These are just the initial figures – incentive levels will come down by US$0.10 per watt-hour once demand has exceeded available funding. If this lowered rate proves popular enough to have allocated all of its budgeted funding within 10 days, the rate drops by the same amount again.

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Energy Storage NewsCalifornia’s US$270m self-generation scheme favouring energy storage set to reopen

3 reasons to get charged up about energy storage

on April 12, 2017

GreenBizIn the world of electricity, few topics are generating more headlines this year than energy storage. Market watcher Navigant Research figures more than 1,420 projects are under way across the power grid, with a new installation trumpeted almost every week.

“Overall, the global energy storage industry is poised to continue to grow quickly over the next several years,” Navigant analyst Ian McClenny noted in a recent update about the market. “With emerging infrastructure becoming increasingly integrated, dynamic and complex, flexible resources like storage will provide added value to existing and new power-generating assets.”

Although energy storage long has been a technology on the brink — drawing R&D dollars from the likes of Tesla founder Elon Musk, the U.S. military and a growing number of utility pilot projects — there is reason to believe that storage tech has entered a new phase in its evolution.

One statistic that should get you thinking: data from research firm Mercom Capital Group estimates that about $820 million was dedicated to energy storage project financing during 2016. That compares with just $30 million tracked by the company in 2015. 

Several initiatives have captured the attention of mainstream media, rather than just the trade press: “A Big Test for Big Batteries,” proclaimed The New York Times in a January article about three huge grid-scale projects in Southern California. The installations are part of broader investments by San Diego Gas & Electric and Southern California Edison meant to improve the stability of the local grid and make it easier to integrate renewable energy generating resources, including solar photovoltaic farms. One storage farm can offer up to 30 megawatts of capacity for up to four-hour stretches. Utilities in other regions are dabbling.

“It’s fair to say we don’t have long-range experience with this technology to say that it is perfect or a nirvana,” Alice Jackson, vice president for Midwest utility Xcel, told The Times. “It’s something we’ll observe as California goes through its experience.”

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GreenBiz3 reasons to get charged up about energy storage

ComEd project targets energy storage at the neighborhood level

on April 12, 2017

Midwest-Energy-NewsA new pilot project from Illinois’ largest utility is bringing energy storage out from behind the substation and into the neighborhood.

Last month, ComEd deployed a 25-kilowatt-hour, lithium-ion battery in Beecher, Illinois, about 40 miles south of Chicago. In the event of a power outage, the battery can supply about an hour of backup power to three houses selected for the project.

It’s part of a broader experiment in Community Energy Storage (CES), or the deployment of medium-sized batteries in between those found in utility-scale applications and the kind of personal, home-battery systems offered by Tesla and others. Taken together, distributed CES units can start to match the scale of larger, more centralized energy-storage systems.

ComEd says the Beecher pilot will run for a year, and that similar pilot projects are in the works. The Beecher CES system is aimed primarily at mitigating reliability issues — the area experiences an unusually high amount of outages due to challenges with a nearby medium voltage line that serves it, according to Manuel Avendano, manager of emerging technology in ComEd’s distribution planning and smart grid group.

Down the road, CES could provide other benefits, such as the integration of more solar energy and reductions in the peak demand periods that strain the grid, Avendano says.

“Through grid modernization and smart grid investments, our reliability performance has been best on record for five years running, and we’re committed to continuous improvement,” Michelle Blaise, ComEd’s senior vice president of technical Services, said in a statement. “We want all ComEd customers to experience great reliability and that’s why we’re innovating and piloting emerging technologies such as energy storage to bring new value to communities and help improve service for our customers.”

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Midwest Energy NewsComEd project targets energy storage at the neighborhood level

The Mutually Beneficial Relationship Between Long Tail Solar and Energy Storage

on April 11, 2017

energy storageThe energy storage market will expand dramatically in the coming years from an annual installation size of 6 GW in 2017 to more than 40 GW by 2021. In addition, an IMS Research report predicts that the market for storing energy from solar panels will go from $200 million in 2012 to nearly $19 billion by the end of this year. This is especially impactful for residential solar, which has seen consistent growth in the past few years and will continue to grow for the foreseeable future.

According to McKinsey, energy storage could be the “missing link” that makes intermittent renewables such as solar and wind power totally accessible and reliable all the time. That’s because it allows energy that’s stored while the sun is shining and the wind is blowing to be used later when the wind isn’t blowing or when it’s dark outside. McKinsey also indicates that there’s significant near-term potential for energy storage, and that this is largely due to the fact that prices are dropping dramatically and could be as low as $160 per kilowatt-hour by 2025.

Clearly, there is a mutually beneficial relationship between solar and energy storage. Particularly, long tail (i.e., small regional) solar companies will see greater opportunities as the industry moves away from consolidation and being dominated to a handful of large companies. This remains to be true despite the recent U.S. government policy shifts that deemphasize climate change. In fact, several companies as well as state and local governments have responded that this new policy won’t impede their efforts to support the development and implementation of clean energy including renewables.

New Opportunities for Long Tail Solar Companies with Energy Storage

Now, with solar financing options becoming simpler and more democratized, smaller and more agile solar providers will experience growth right along with the burgeoning energy storage industry. In fact, data show that residential energy storage will grow to 660 MW by 2021, and that most of it will be paired with solar. Solar paired with energy storage will drive growth in both industries.

This implies that partnerships need to be formed between solar and energy storage companies. That’s because long tail installers will need energy storage solutions to meet residential customer demand. However, one of the caveats is that not all energy storage solutions are the same because energy storage isn’t commoditized.

An example is the difference between a simple energy storage system versus an intelligent energy storage system. A simple system will allow customers to store energy from the grid or renewables and that’s pretty much it. For many people, this will be enough to satisfy their energy storage needs. An intelligent system will do this as well, but it will also facilitate energy optimization, home automation, and integration with the Internet of Things (IoT). 

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Renewable Energy WorldThe Mutually Beneficial Relationship Between Long Tail Solar and Energy Storage

The first offshore vessel with a battery energy storage system in operation

on April 11, 2017

Energy Storage NewsOn-board batteries are the way of the future. Energy storage is the right approach to make energy systems on board ships more intelligent and efficient. Energy storage systems can be especially beneficial on vessels with a widely fluctuating fuel consumption profile.

Nidec ASI, world leader in PV and BESS (battery energy storage system) projects, retrofitted a Norwegian ship, the Viking Queen (a 6,000 tonne vessel built in 2008), with a battery energy storage system to help reduce fuel consumption and emissions for greener, more efficient power supply.

Eidesvik Offshore is a Norwegian ship company that specializes in offshore logistics, seismic and underwater operations. With two dozen ships in its fleet, the environmentally sensitive company has a keen interest in finding ways to reduce fuel consumption, emissions and maintenance costs. For The Viking Queen, one of its offshore support vessels, Eidesvik sought an energy storage solution that would help it achieve these goals.

An ambitious retrofit process

To improve the energy efficiency, Eidesvik made the decision to retrofit the Viking Queen with a BESS, making it the first operating offshore vessel to benefit from such a system. Provided by Nidec ASI, the 650kWh, 1600kW containerized solution was custom-designed to match the vessel’s operating profile.

The use of battery storage reduces the vessel’s fuel consumption by approximately 18%. The BESS also makes it possible for Viking Queen to reduce nitrogen oxide, carbon dioxide and other greenhouse gas emissions by approximately 25%.

This is the first offshore vessel to get such a system installed as a retrofit solution and demonstrates that it is possible to achieve significant reductions in emissions for existing vessels.

The project is the result of cooperation between Lundin Norway, which has the vessel on hire, ZEM as supplier of the system and Eidesvik. Commercialisation of the technology has been made possible largely because Eidesvik participated in the research and development project FellowSHIP that has worked with battery technology for five years.

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Energy Storage NewsThe first offshore vessel with a battery energy storage system in operation