The Story of Storage

As a graduate student, you often hear a lot about the tremendous disruptive power of energy storage. Companies that work on energy storage often don’t do just batteries, but they want to offer their customers and partners a landscape of energy solutions. These products can take on many forms, whether it’s on-site battery installation or energy analytics, we cannot be diligent professionals in the energy sector without knowing at least a little about storage.

Major players in the storage space often offer energy solutions both in the form of software and hardware. They can have vertically integrated, behind-the-meter, commercial product including software programs showing real-time usage, battery units, and monitors. Usually, the software will attempt to combine historical energy use, weather reports, and rates to provide predictive outlooks on customer energy use. Software and hardware will work in concert to draw in energy when prices are low and deploy them when prices are high.

Energy storage companies can partner with utilities and other grid service providers as capacity resources for the electricity grid at large. As shown in the below figure, the load increases and decreases with predictable hours of high electricity use and lower electricity use in a given 24-hour time period.

Hamilton, Katherine (2015). Energy Storage: State of the Industry. Energy Information Administration Energy Conference 2015. (Accessed 19 February 2017).

Storage companies may offer their services of aggregated, customer-sited storage to level out, or flatten the electricity demand curve during peak hours of usage. They can work alongside operators to provide capacity and ramping resources, as well as real-time grid visibility. Companies can aggregate their storage capabilities and provide them as a resource to the grid by participating in the day-ahead market.

Partnerships with a utility or operator have partially relieved issues regarding high penetrations of intermittent renewables and the associated challenges surrounding voltage, power, and frequency on the grid. Storage can help customers reduce energy costs by providing informational tools to know when it is peak demand, while simultaneously gaining revenues from the grid in areas where they are participating in the day-ahead market.

In southern California’s recent memory, the Aliso Canyon leak from a natural gas storage facility accelerated public support for distributed energy resources, such as behind-the-meter storage. Storage industry leaders are now able to deliver aggregated, commercial-scale storage services as a response to events like this. This solution is referred to as virtual power plants (VPP).

As pilot programs transition to real-time markets, 2017 can be a pivotal year for storage services to be incorporated beyond atypical states such as California and Hawaii. Utilities will be watching storage partnerships to see if the aggregated storage model can be applied to their regions of the grid. Storage-as-a-service can be an additional benefit for businesses that are seeking to consume energy in a cost-efficient way, potentially incentivizing more commercial and industrial customers to adopt energy storage products.

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