Utility Applications for Energy Storage. NY-BEST Capture the Energy 2018 March 15, 2018 Albany, NY

Transcription

1 Utility Applications for Energy Storage NY-BEST Capture the Energy 2018 March 15, 2018 Albany, NY

2 Presenter Pete Falcier VP Analytics & Regulatory Affairs (646)

3 REV Demo FTM Energy Storage Services Agmt. (ESSA) Model INNOVATIONS 3rd Party Owned But Entirely Utility Directed Effectively Like a Grid Asset Utility-Targeted Siting & Interconnection Storage Goes Where Grid Really Needs It First-of-a-kind Dual Participation Con Ed + NYISO Share Use of Storage Asset Utility Priority Dispatch (T&D Support) NYISO Secondary Dispatch (Wholesale & Ancillary Services) New Digital Controls Platform for Secure Con Ed + NYISO Dispatch Optimization Utility Pays Quarterly Grid Services Fee But Shares NYISO Secondary Revenues New Asset Class for NYISO Energy Storage Resource (ESR) & ESR Aggregation Possible New T&D Service Classification for Utility Delivery (3rd Party-Owned Grid Asset)? ADAPTATIONS FROM TRADITIONAL PPAs ESSA = Prototype for Storage Equivalent of PPA Purely Energy Transaction for Utility But For Grid Services, Not Just Power Purchase Purely Real Estate Transaction for Property Owners Think Leases to Farms for Windmills No Host Site Energy, Operational, or Billing Impacts Turns Otherwise Unused/Undervalued Land into Valuable Energy Property Amortizes Utility s Capital Costs Across Life of Project Preserves Utility Cost Recovery for Grid Support Services Capital Expenses Quarterly Payments Grid Benefits/ Secondary Revenues Secondary Revenues Secondary Markets Other Subs Dispatch Optimiz. O&M Warranty Secondary Revenues Energy Storage LLC Market Services Lease Payments Host Site Capital Investment Return on Investment Capital Expenses 3rd Party Financier Grid Services Payments Market-Based Earnings Potential Incentive 3

4 For Grid-Tied Storage to Scale in NYS, Three Key Questions 1) Where to put it? 2) How to control & optimize it? 3) How to pay for it? 4

5 In Order to Scale Effectively...Grid-Tied Storage Will Need to Draw on All DER, Energy Storage & REV Initiatives in NYS (and a few from CA) Where to put it? REV Demo Darts Looking for Bullseyes NYISO-Joint Utilities1 Granular Pricing Visualization (Q2 2018) & Transmission Node Mapping ( ) Utility-Developer Virtuous Feedback Loop Emerging via REV Joint Utilities DG Hosting Capacity Mapping REV Non-Wires Solutions RFPs Joint Utilities Locational System Relief Value (LSRV) and Value of DER (VDER) Mapping Bullseyes Looking for Darts 1 Granular Pricing & Market Price Delivery NYISO MIWG 9/29/17 5

6 In Order to Scale Effectively...Grid-Tied Storage Will Need to Draw on All DER, Energy Storage & REV Initiatives in NYS (and a few from CA) How to control & optimize it? NYISO DER Roadmap & Energy Storage Resource (ESR) Market Design (FERC Order 841) Highly Optimized Storage (HOSt)TM Software Platform for Con Ed + NYISO Dual Participation As of December 2017 More than Smart Report CAISO, PG&E, SCE, SDG&E June 2017 DSP = Distributed System Platform DCE = DER Coordinating Entity (Aggregator & NYISO Market Participant) Keys will be 1) Digital controls platforms or middleware like GIE-SGS HOStTM (Highly Optimized Storage) Enabling DSP/Utility & NYISO to share use of ESR asset and co-optimize dispatch Facilitating Value Stacking Bridging Storage OEM on-board software and DSP/NYISO software 2) Harmonizing DSP and NYISO interconnection & telemetry standards through NYS SIR 6

7 In Order to Scale Effectively...Grid-Tied Storage Will Need to Draw on All DER, Energy Storage & REV Initiatives in NYS (and a few from CA) How to pay for it? Still Early Days for Grid-Tied Storage Ratemaking in NYS REV Demo Objective: Simplification Revenues: Utility Quarterly Payments + % of NYISO Market Sales Expenses: Nominal Grid Access Fee + TOU Demand Charges (TBD) NYS PSC Case 17-E-0458 (Con Edison): Complication Revenues o Utility Buy-Back (SC 11) NYISO Wholesale Market Bids o Silent on Utility Contract Payments o Referred to NYS DPS Value Stack (VDER) Working Group Expenses o Utility Energy Supply NYISO Wholesale Market Bids o Buy-Back (SC 11)/Standby (SC 9) Delivery Bills (> 1 MW) o Referred to NYS DPS Rate Design Working Group Brattle/EOS Report 2 CA Energy Commission September 2017 Upfront Fixed Revenue SIR to be updated to show HOW TO interconnect: PV+Storage Standalone FTM Storage BTM Net Generation Storage (BTM:NG) All of the Above for NYISO Dual Participation NYS VDER Value Stack Designed as a credit against host site bill How will it work for standalone FTM ESR with no host site bill? Payment from utility to ESR? Locational System Relief Value (LSRV) Demand Reduction Value (DRV) NYS Standardized Interconnection Requirements (SIR) REV Demo PSC VDER & Rate Design Optimal Future? EPC Costs Soft Costs Interconnection Costs or Environmental Value (E) Capacity Value (ICAP) Energy Value (LBMP) Contracted Quarterly Payments from Utility Market Transition Credit (MTC) EPC Costs Soft Costs Interconnection Costs VDER Demand Reduction Value (DRV) VDER Market Transition Credit (MTC) Lower EPC Costs Lower Soft Costs Low-to-Zero Interconnection Costs Contracted Quarterly Payments from Utility? -AND- VDER DRV/MTC? 2 Stacked Benefits: Comprehensively Valuing Battery Storage in California Brattle Group CA Energy Commission 9/2017 Variable Revenue Fixed Expenses Variable Expenses NYISO Wholesale & Ancillary Sales* Utility Buy-Back Sales (LBMP, ICAP) *Shared by Storage LLC & Utility to Align Interests Utility Contract Demand Charge NYISO Wholesale Supply Utility Supply Utility Volumetric Charges Utility As-Used Demand Charges VDER Locational System Relief Value (LSRV) VDER Energy Value (LBMP) VDER Capacity Value (ICAP) VDER Environmental Value Utility Contract Demand Charge Utility Grid Access Charge Some Base Charge TBD? NYISO Wholesale Supply Utility Supply Utility Volumetric Charges Utility As-Used Demand Charges VDER LSRV VDER Energy Value (LBMP) VDER Capacity Value (ICAP) VDER Environmental Value Other NYISO Wholesale & Ancillary Sales* *Shared by Storage LLC & Utility to Align Interests Utility Grid Access Charge (On Par with Utility Assets Where ESRs Designed Strictly as Grid Assets) NYISO Wholesale Supply Utility Supply Utility As-Used Demand Charges (On Par with Utility Assets Where ESRs Designed Strictly as Grid Assets) 7