WASHINGTON — Declining costs and new market rules are opening opportunities for energy storage, but the technology’s operating characteristics are proving challenging to system operators and market designers, speakers told the Energy Storage Association Policy Summit last week.
Jurisdictional questions also are creating uncertainty, speakers said.
David Kolata, executive director of the Citizens Utility Board in Illinois, captured the optimism at the daylong conference, declaring his consumer group as “bullish” on the technology.
“In our minds, the declining cost curve of batteries and other storage technologies is the single most encouraging trend in the electricity space today,” Kolata said. “We see storage as an essential component of a least-cost future, and we say this because if we get the policy right there are multiple sources of consumer value.”
Kolata cited lower cost for frequency regulation, reduced costs for integrating renewables, increased grid flexibility and reliability and the deferment of transmission and distribution system investments.
“And perhaps most importantly, storage can lower peak demand. From the consumer point of view, nothing is more important than reducing the peak. As you know, a large percentage of overall system costs are driven by 30, 40, 50 hours a year, so if you can reduce that peak, there are benefits for all consumers.”
Kolata said storage — along with time-based rates — will be crucial to ensuring transportation electrification brings benefits.
“At CUB, we see the potential benefits from electrification, but … only if vehicles charge when they should and don’t charge when they shouldn’t,” he said. “If transportation electrification increases peak demand, it’s going to be bad for the environment and bad for consumers.”
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