Adding g Storag age: e: Tec echnol ology ogy, E Econom omic a and Regulator ory y Issues es i in Hy Hybridization June 11, 2020 www.energystorage.org
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Today’s Speakers Rob Gramlich Rhonda Peters Jason Burwen Founder & President Principal VP, Policy Grid Strategies LLC InterTran Energy U.S. Energy Storage Consulting Association
Adding St Storage t to Existing a and Operating Renewable P Projects ESA SA W Webinar J June 11, 11, 2020 2020 Rob Gramlich www.gridstrategiesllc.com
Hyb ybrid PPA P Prices F Falling (PV PV-batt ttery) • Prices in the continental US dropped from $40-70/MWh in 2017 to $20-30/MWh in 2018 and 2019. • Primarily due to falling technology costs and tax credit qualification • Battery/generation ratio and battery duration rising 8 Source: Gorman et al, LBNL (2020), https://eta.lbl.gov/publications/motivations-options-deploying-hybrid
Rapid H Hybri rid D Deployment Growth • 4.6 GW of hybrid capacity currently installed. • 14.7 GW of hybrid capacity in the immediate development pipeline. • >40 GW of hybrids entered queues in 2019 • 69 GW of hybrid capacity currently in ISO/RTO interconnection queues Sources: EIA (2020) https://www.eia.gov/todayinenergy/detail.php?id=43775 9 Gorman et al, LBNL (2020), https://eta.lbl.gov/publications/motivations-options-deploying-hybrid
Hybri rids Concentr trated i in C CA Source: Gorman et al, LBNL (2020), https://eta.lbl.gov/publications/motivations-options-deploying-hybrid • Hybrids ~49% (35,675 MW) of CA queue as of September 2019 • CA has reached solar penetration level where time-shifting is valuable • Other regions will reach that point in the future 10
Som ome La Lasti ting B Ben enefi fits ts o of Hybrid id v vs Stand-Alon one… e… ev even n thoug ugh p h power m market ets a s aggregate a all s sources es • Investment T Tax C Cred edit qualification f for r the e battery-- -- temporary • If accept some operational flexibility limitations • Shared ed t transmission i inter erconnection s ser ervice-- -- lasting • Shared i inverter-- -- lasting • For new projects. Not the case for adding battery to operating generation. • Shared ed l land, c constru ruction l labor-- -- lasting • Shared ed P PPA n neg egotiation a and c contracting— lasting • Self-op opti timizing d dispatch ch- -lasting => The n e natural s state i e is mostly h hyb ybri rid r ren enewables, e even en w without a a tax cred edit advantage 11
Cost Savings Co-location vs Integration vs Stand-Alone Combined ed c cheap eaper er t than an s separ arate • Possible capacity value benefit—complex Effective Load Carrying Capability analysis Fu, Remo, Margolis, R., NREL, 2018, https://www.nrel.gov/docs/fy19osti/71714.pdf 12
Inte tegrate ted D DC-Co Coup upled ed Hybr brids S Save e $ on I n Inver erter er S Size e (N (Not t possible b by a y adding s storage t to e existi ting g generati tion) NC State Energy Storage Team (2019) https://energy.ncsu.edu/storage/wp- 13 content/uploads/sites/2/2019/02/NC-Storage-Study-FINAL.pdf
Addin ing St Stor orage to o Existin ing G Gen eneratio ion Ca Can Be Be a Faster r Path t to Market • Queu Queues ar are s e slow (3 years) a and cl clogged (60 600 G GW) so so new hybrids w will take a a long ti time t to g get th t through • So w why not a add storage t to the 20 200 G GW of so solar a and 15 150 GW o of wind already i in queue? 14
Hybrids, especially PV-battery, are in high demand and are a natural fit for wholesale power markets 39 proposed reforms for RTOs & FERC • Interconnection • Capacity credit • Market participation https://gridprogress.files.wordpress.com/2019/09/e nabling-versatility-allowing-hybrid-resources-to- deliver-their-full-value-to-customers.pdf 15
Policies a are La Lagging • Rece cent F FER ERC r reforms do not mention h hybrids • FERC Storage Order No. 841 • Generator interconnection Order No. 845 (began in 2015) • Allows additions to existing generation but not queued generation • Market r rules r represent h hybrids a as d devi viations from e existing re resourc rce t types 16
Policy P Principles 1. 1. Indiv ivid idual m l mark rket p part rticip icipants s should ld b be a able le t to m o make t their o ir own economic c choices a s about h how a and wh when t to o operate, a as long a as gr grid id op operators can u ultim timately s ly step in t to p o prevent v viola olation of of relia liabilit ility c y constrain ints or or the e exercis ise of of m mark rket p power. . 2. 2. Mark rket p part rticip icipants s should ld b be a allowed to freely ly add capabilit ilitie ies to p propose sed a and e existing p projects as l long a as the c chan anged ele lectri rical p l propertie ties do n o not h ot harm rm t transmis ission s system relia liability ility. 3. 3. Gr Grid o operators s s should appropriately v value r reso sources’ s’ contr trib ibutio tions i in s such ch a a way t y that avoid ids s systematic ically ly u under- valuing (or or ov over-valu luin ing) c certain in c config iguratio ions r rela lativ tive to oth others. 17
Keep i in touch! h! rgramlich@gridstrategiesllc.com Twitter er: @ @RobG bGramlichDC, #energytwitter er 18
Grid Interconnection of Hybrid Projects Rhonda Peters, Ph.D. June 11, 2020 InterTran Energy Consulting Energy Storage Association
Hybrid Projects • Interconnection Studies – Order 841 and Hybrid Projects – Hybrid Study Assumptions • Adding Storage to Existing Wind or Solar – Material Impact study Check – Order 845 Surplus Interconnection Shortcomings • Storage as a Generator Interconnection Upgrade • Recommendations
Order 841 on Energy Storage -Tariffs Must Now Allow Energy Storage to Participate in the Market (Buying and Selling) -Implementation/Compliance Over the Next Few Years - Opened the door for Hybrid Projects! Since the majority of hybrid projects involve Energy Storage, having established Tariff policies for storage, including study and operational models, is a critical first step!
Hybrid Interconnection Studies - Connection of Dual Generation Technologies - Each fuel source/generator is directly connected to the grid - Wind/Solar can charge a battery, that is connected to the grid - Dispatch Assumptions – Dispatch determines Power Flow – Power Flow determines Constraints – RTO/ISO’s utilize different dispatch methodologies – ISO/RTO’s study “worst case power flows” to assign Network Upgrades and can include scenarios that may not be operationally possible, likely, or desired by the Interconnection Customer
Hybrid Dispatch in MISO From MISO Business Practice Manual 15 Appendix E
Adding Storage to Existing Wind/Solar Order 845 Surplus Interconnection - Surplus rights depend on host generator being in operation (rights expire 1 year after host retirement) - Material modification impact study required - Host project must have executed generator interconnection agreement (does not need to be constructed) - Allowed in Tariffs under Order 845 , but generally requires Business Practice Manual updates to be utilized in practice Adding Storage to Generation in the Queue – Material modification impact study required – Changes in fuel source prohibited due to archaic Federal policy
Order 845 Surplus Interconnection Shortcomings Surplus NOT Allowed While Project is in the Queue – Purely a matter of policy, not engineering! – Individual ISO/RTOs could file to allow as “superior” to 845 standard (845 requires a completed LGIA) Material Modification Impact Study: - Must ensure no harm to other generators - Must electrically perform equivalent or better to original - Must not inject more power than original interconnection allows, including dispatch-up in study scenarios
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