Utilities play a central and multifaceted role in implementing state energy storage policies across the United States. Their involvement mainly includes procurement, ownership, regulatory compliance, and participation in demonstration projects or pilot programs under various state mandates and incentives.
Utility Roles in State Energy Storage Policies
1. Procurement of Energy Storage Resources
Many states have established energy storage procurement targets, requiring utilities to acquire specified amounts of energy storage capacity by certain deadlines. For example:
- California mandated its investor-owned utilities to procure 1,325 MW of energy storage by 2020, later increasing the goal to 1,825 MW including distributed storage.
- Oregon directed its two largest investor-owned utilities to install a minimum of 5 MWh of storage by 2020.
- Nevada set targets for utilities to procure 1,000 MW by 2030, with interim milestones starting at 100 MW by 2020.
Similar procurement targets exist in at least 12 states, including Connecticut, Illinois, Maine, Maryland, Massachusetts, New Jersey, New York, Rhode Island, and Virginia.
2. Ownership and Investment in Energy Storage Assets
Utility ownership policies vary by state. Some states allow utilities to own energy storage assets fully or partially, while others restrict or limit such ownership to encourage third-party or customer ownership models. For example, California’s energy storage mandate allows utilities to own storage but caps their ownership at 50% within each segment of the power system (transmission, distribution, customer-sited), encouraging a mix of utility, third-party, and customer ownership.
3. Regulatory Adaptation and Compliance
Utilities must adapt their operations and planning to new regulations that support energy storage deployment. This includes integrating storage into grid management, updating tariffs and incentives, and complying with state commission rules guiding storage procurement and operation.
4. Participation in Demonstration and Pilot Programs
Utilities often lead or engage in demonstration projects to test new energy storage technologies and business models, providing valuable data to regulators and stakeholders to shape future policies and market designs.
Summary
Utilities act as the primary agents for meeting state energy storage mandates through mandated procurement, ownership (where allowed), regulatory compliance, and participation in demonstration projects. Their active role is pivotal in driving the adoption and integration of energy storage, which supports grid reliability, renewable energy integration, and consumer benefits in states with established policies.
This broad utility involvement reflects a strategic approach in many states leveraging regulatory, financial, and operational frameworks to accelerate energy storage deployment.
Original article by NenPower, If reposted, please credit the source: https://nenpower.com/blog/what-role-do-utilities-play-in-implementing-state-energy-storage-policies/
