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Distributed Batteries Offer Value Far Beyond Demand-Charge Reduction
“We know that in electricity, the future is based on flexibility behind the meter, solar and smart controls -- and that future is a lower-cost future.”Distributed Batteries Offer Value Far Beyond Demand-Charge Reduction
by Katherine Tweed
October 07, 2015
0
In the U.S., behind-the-meter energy storage is mostly sold to offset commercial peak demand charges. The business case works today in states such as California and New York, but it also leaves most of the battery’s value on the table, according to a new report from Rocky Mountain Institute.
RMI’s meta review of the value of energy storage, pulling from many previous studies, found that batteries dispatched solely for demand reduction are only used for about 5 percent to 20 percent of their useful life. RMI identified 13 distinct services for customers and grid operators, but when it comes to stacking those, there is immense variation in the final cost-benefit depending on assumptions and inputs such as local utility regulations and wholesale market mechanisms.
The report was written not just to validate what progressive states like New York, California and Hawaii are doing, but also to show what’s possible in other states.
“Valuing batteries is not as simple as looking at just [the levelized cost of] solar or looking at retail or wholesale grid costs,” said Jesse Morris, manager of the electricity practice at RMI. “A lot of regulatory changes need to happen.”
by Katherine Tweed
October 07, 2015
0
In the U.S., behind-the-meter energy storage is mostly sold to offset commercial peak demand charges. The business case works today in states such as California and New York, but it also leaves most of the battery’s value on the table, according to a new report from Rocky Mountain Institute.
RMI’s meta review of the value of energy storage, pulling from many previous studies, found that batteries dispatched solely for demand reduction are only used for about 5 percent to 20 percent of their useful life. RMI identified 13 distinct services for customers and grid operators, but when it comes to stacking those, there is immense variation in the final cost-benefit depending on assumptions and inputs such as local utility regulations and wholesale market mechanisms.
The report was written not just to validate what progressive states like New York, California and Hawaii are doing, but also to show what’s possible in other states.
“Valuing batteries is not as simple as looking at just [the levelized cost of] solar or looking at retail or wholesale grid costs,” said Jesse Morris, manager of the electricity practice at RMI. “A lot of regulatory changes need to happen.”
... more at http://www.greentechmedia.com/articles/read/Distributed-Batteries-Offer-Value-Far-Beyond-Demand-Charge-Reduction