Using Energy Storage to Create Value Streams in the Utility Landscape

The evolution in recent years of how power is generated, transmitted and controlled is unlike any movement we’ve seen in the history of the electrical grid.

More than ever, utilities are taking measures–both mandated and voluntary–to move away from centralized fossil fuel assets towards cleaner, distributed resources that can be applied precisely where and when needed. This paradigm shift­, coupled with energy consumers’ increased desire for more choice, control and transparency, brings a new set of challenges for utility executives and grid operators tasked with maintaining a delicate balance of supply and demand.

To support the move towards a more dynamic grid and modernized operations, utilities are looking at implementing distributed energy storage.

According to a report by the Rocky Mountain Institute, distributed storage can provide as many as 13 unique value streams to stakeholders, more than half of which are for energy operators like utilities and ISOs. Today, energy storage services can help address both system and local capacity challenges, voltage fluctuations, ramping issues presented by high penetrations of renewables, and poor visibility at the grid edge. Distributed storage can be a cost-effective resource that helps build a more resilient, sustainable, and flexible grid, and the key to maximizing its value is intelligent control software.

Grid Resilience

In the case of enhancing resiliency, distributed energy storage offers a safe, clean and reliable grid asset when additional capacity is needed to keep the lights on. Never has this been more apparent than with today’s situation in Southern California, where the Aliso Canyon gas leak has created a major supply deficit for the numerous regional power plants supported by the field. An estimated 97,100 tonnes of methane and 7,300 tonnes of ethane were released into the atmosphere, making this one of the largest leaks in history and dramatically increasing the risk of blackout conditions in the LA Basin this summer.

By adding distributed energy storage technologies to their capacity portfolios, utilities can rapidly deploy stored energy from customers’ facilities to maintain balance during peak hours and avoid service disruptions. In fact, Southern California Edison has procured 85 MW of intelligent energy storage from Stem for this purpose. The companies are working together to provide critical load relief and reduce the risk of outages in 2016 and 2017.

Renewables Integration

Currently, 30 states and the District of Columbia are home to renewable portfolio standards, and many have struggled to manage the influx of distributed assets onto the grid. It’s no coincidence that two of the nation’s leading solar states — California and Hawaii — are also leading the charge on storage. Distributed energy storage systems work in tandem with grid needs to automatically smooth solar customers’ load profiles, saving or deploying energy as needed to overcome variability concerns. Storage is the only technology that can simultaneously promote the expansion of renewables and strengthen grid operations, thereby bridging a significant gap between utilities and ratepayers.

Energy Storage as a Service

At the end of the day, a battery can only do so much, which is why “˜storage as a service’, or the robust software services that control storage systems, have emerged as the real differentiator of energy storage technologies. The power of software is evidenced in its ability to combine onsite monitoring and control, big data and predictive analytics to squeeze the most value from batteries. This is what allows systems to be aggregated and dispatched to respond to grid events. There is value in each individual battery system, but their value to the grid compounds when systems are aggregated and dynamically dispatched to optimize locational grid needs.    

Some storage as a service providers have made the highly granular sensor data that feeds into storage systems available to utilities, grid operators, and commercial customers through intuitive, easy-to-use interfaces. More than ever, grid operators need access to precise, real-time data to manage loads. Software-enabled energy storage not only empowers building managers to better optimize on-site energy use, but also brings utilities’ operation centers unparalleled visibility and control at the grid edge.

Today, leading storage software providers are teaming up with utilities on programs that deliver powerful insight into what’s happening at the edge of the grid to better understand customers’ power quality and consumption patterns. With a treasure trove of data at their fingertips, grid operators can make better informed decisions on everything from voltage control to infrastructure investments, all while strengthening customer engagement.

Multiple Value Streams, Stronger Resources

With distributed energy storage, utilities can efficiently address the pressing challenge of today’s rapidly changing grid landscape. Especially as more states look to meet increasing renewable energy targets, storage delivers greater stability, more flexible capacity and access to actionable data to improve decision making. Storage as a service is the first step toward the grid of the future, and will enable a host of other transformative technologies that will ease the transition to more sustainable, resilient operations.


About the Author: Matt Owens is the director of business development for Stem Inc., a company focused on software-driven energy storage. Millbrae, California-based Stem has more than 68 MWh in systems operating and under contract.


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