The Brass Tacks of Energy Storage
Everything you wanted to know about grid energy storage valuation in under an hour
Energy storage is growing fast in the United States. According to a recently released report from the energy industry research firm Wood Mackenzie, the U.S. energy storage market will grow from just under $2 billion this year to $7.2 billion by 2025.
Most of the energy storage being deployed today involves utilities installing front-of-the-meter or grid-scale storage to improve the resilience and flexibility of the power grid. Grid-scale energy storage can be used to provide backup power during outages, additional energy capacity, frequency regulation and voltage stabilization, support for microgrids and resources for demand response programs.
However, as utilities spend billions of dollars on energy storage investments, what is the business value of all those capabilities and grid services? How do variations in storage technology, deployment strategy, location, and other variables impact return on investment for grid energy storage?
A crash course on grid energy storage use cases and valuation
Earlier this year, Patrick Balducci, chief economist at Pacific Northwest National Laboratory, delivered an information-packed presentation about his team’s energy storage valuation work to students and faculty at The Naval Postgraduate School in Monterey, California, as part of the school’s Defense Energy Seminar. The 55-minute presentation is available on video here.
Balducci and his team worked with utilities across the country—deploying energy storage systems with combined power and energy storage capacities of 1.6 GW and 18.2 GWh—to answer critical questions about the business case for grid energy storage. The projects involved different types of energy storage technologies supporting multiple use cases in diverse operating environments, including Washington, Oregon, Hawaii, Massachusetts, California, New York, and Puerto Rico.
Titled “Pacific Northwest National Laboratory’s Industrial Acceptance Program: How the use of analytics can improve the value proposition for energy storage in the United States,” the presentation provides an overview of key grid energy storage projects. The lecture also reviews the framework and tools the PNNL team has developed to quantify grid energy storage value, an assessment of technology fit to specific use cases, and results from these field projects in terms of business case value.
If you’re looking to augment your knowledge of grid energy storage technology and valuation, watching this video is a very efficient way to do that.