FERC Wants Smaller, Faster, Distributed Storage to Speed Renewables

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At the February 17th business meeting,  FERC proposed that we pay more for the now more valuable fast response energy regulation provided by the newer and more responsive energy-storage technologies, because these are the ones that we will soon need more of, according to a report at Energy Prospects.

No one doubts that more storage is needed on the grid as we add more renewable energy, so we can keep electricity supplies even. Traditionally, the slower amount of storage needed in the past has been adequately ramped up in time by pumped hydro, steam turbines and combustion turbines.

But as we add more renewables, we need to create faster, more nimble and responsive storage.

From this new need has sprung an assortment of innovative large-scale battery systems, flywheels, electric-vehicle-to-grid systems, and even demand response agreements with large commercial customers – that can cycle refrigeration units off for a few minutes, for example – that are able ramp up or down much faster than the traditional sources.

In wholesale markets, “slower, larger resources are being given a compensatory advantage for their size while faster, smaller resources do not similarly receive compensation for their ramping speed,” FERC said at the meeting.

Currently, utilities pay resources to keep capacity off line, so it is there when needed to ramp up. But the smaller, faster ones we will need more in the future, are currently paid less.

FERC cited the example of  a 30-MW slow resource that would receive a larger capacity payment for regulation than a 10-MW fast resource, but the two resources would receive the same amount for real-time regulation provided, even though the smaller, faster resource is increasingly more useful. The ramp-up speeds needed can be a matter of a few minutes, or even seconds.

For example, Beacon, with a 20 MW flywheel energy-storage system in New York, said its flywheels can ramp up at 4 MW per minute when dividing regulation capacity over five minutes, but the actual ramp rate is 300 MW per minute, fully deployed in four seconds.

Speaking for California, which now gets 18% from renewables, Cal-ISO said that once it reaches 20% online, the grid will need to be able to raise or lower electricity supplies by about half a gigawatt, and that this will rise to a full gigawatt by 2020 when we have 33% renewables on the grid.

So the provision of fast response frequency-regulation services in California must total a gigawatt (1,000 MW) by 2020. (the state has already passed regulations making this kind of accompanying storage mandatory, to rise along with renewables, as they ramp up)

Cal-ISO already has launched a regulation energy management mechanism that would allow energy-storage devices with 15-minute storage capability to participate in Cal-ISO markets. The mechanism uses the five-minute real-time energy market to manage the state of charge for energy-storage devices.

Supplying this new market will be a large new innovation-driven distributed-storage industry, and not without bumps along the way.

Image: Michael Menefee

Susan Kraemer@Twitter

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