Five Facts about Energy Storage that Every Californian Should Know

October 26, 2020 | 5:56 pm
Solar panels in the desertTom Brewster Photography/flickr
Matthew Beyer
Center for Science and Democracy Program Assistant

If you aren’t already paying attention to energy storage, you should be. While most people admittedly don’t get giddy at the thought of a lithium ion battery, energy experts and policymakers do and they are becoming increasingly excited about the potential role energy storage can play in the future of electricity management. And for good reason – storage can help build resiliency, shore up energy reliability in communities, and support the move to 100 percent renewable energy. And nowhere is this more apparent than California – a state that has already committed to 100 percent clean electricity and has quickly turned to energy storage as a key piece of this challenge. Over the past decade, the state has been a leader in storage development and has pioneered successes in the area that any energy-interested reader would be remiss to ignore. If this is news to you, not to worry, we’re here to catch you up. Here are five facts about energy storage in California you need to know.

1) California leads the charge on energy storage

California leads all states in energy storage deployment, and frankly, the other states aren’t even close. According to the Department of Energy, California currently boasts around 300 utility-scale storage projects, well ahead of second place New York and Massachusetts with only around 40 each and about triple the number of active projects in the entire nation of Germany. This accounts for more than 1,500 megawatts (MW) or 1.5 gigawatts (GW) of storage capacity. To put that in context, this amount of storage has roughly the same maximum power output as 4.68 million solar panels and around 13,635 Nissan Leafs (or the flux capacitor of one time traveling DeLorean).

Notably, California’s storage prowess extends beyond its sheer number of projects. The state was the first in the nation to establish an energy storage procurement target a decade ago and has continued to be a trailblazer in developing and passing storage legislation. California, for instance, is the only state along with New York, to design storage policies aimed at addressing equity and underserved communities to rectify disparities in energy access and cost.

2)  California’s storage programs and projects are innovative

The state is home to some of the most ambitious storage initiatives, projects, and mandates in the world. At the cornerstone of these achievements is the Self-Generation Incentive Program (SGIP), an initiative that provides financial incentives to promising storage projects, both commercial and residential. The program has already provided millions of dollars in incentives and is poised to continue funding projects through at least 2025. This is particularly exciting for residential customers seeking to outfit their homes or small businesses with battery technology. The program will prioritize future funding for low-income and high-fire-threat communities in the hope that storage can help individuals keep the lights on during outages.

Along with SGIP funding, the state’s electricity providers have embarked on the development of a handful of groundbreaking storage projects. Notable among these is Pacific Gas and Electric’s (PG&E) landmark Moss Landing substation battery, which began construction in July 2020 and – once fully operational – will be one of the largest battery systems in the world.  Another project, the Los Angeles Department of Water and Power’s Beacon Solar Plant has – for several years – successfully demonstrated the pairing of solar power with battery technology in what could serve as a template for future storage plus clean energy partnerships. Dozens of early stage pilot projects are also underway in the state trialing promising storage technologies ranging from zinc batteries to molten sulfur thermal storage.

3) The state has surpassed all its storage targets (so far…)

California’s first and most ambitious energy storage goal was established in 2010 with the passage of Assembly Bill 2514 (AB 1514). The bill called upon the California Public Utilities Commission (CPUC) to determine how much energy storage the state should secure – a decision it ultimately made in 2013 when it announced a procurement target of 1,325 MW of storage by the year 2020.

As we close in on the end of 2020, California is comfortably outpacing its initial target with at least 1,500 MW of storage already procured and more projects likely on the way before the end of the year. Notably, the state’s three largest utility companies, PG&E, Southern California Edison, and San Diego Gas and Electric, have all reported storage procurement in excess of, or on track to meet, their mandated targets. While California’s eventual storage needs are far from satisfied (more on this in a moment), AB 2514 serves as an impressive reminder of how far the state has come in developing and deploying storage in only a decade.

4) California has a long way to go to expand storage

As the state barrels into the next decade with its sights set on a 100 percent clean energy future, additional storage will be crucial (and 1,500 MW simply won’t be enough). In fact, while there is no definitive estimate for the state’s storage needs beyond 2020, most experts agree that a sizable “ramp-up” in storage capacity will be necessary. Indeed, most estimates suggest anywhere from 10,000-20,000 MW of storage could be needed within the next ten years – and at least quadruple that by the end of 2050. These ambitious estimates reflect the need for added energy storage that will ensure grid reliability and reduce greenhouse gas emissions as California transitions to 100 percent clean electricity.

5) The path forward won’t be easy

The simple truth is that jumping from around 1,500 MW of storage to anywhere close to what experts expect California will need by the midpoint of the century, will be a challenge. And despite California’s track record on meeting its storage goals, its success is far from a given. In fact, there are several barriers the state will face that could pose significant challenges (though, not insurmountable if policymakers, energy managers, and community leaders commit to finding solutions).

California will need to make storage a priority and find the budget funds to support expansion. If it doesn’t, the state may find it increasingly difficult to integrate storage technologies into the energy market at the rate required to meet its 2045 climate goals. Refining the rules around market participation, to better account for the value of storage, remains one of the obvious steps policymakers and regulators will need to take to allow storage to realize its full potential – both on the grid and in the market. This means recognizing (and properly valuing) the host of auxiliary benefits offered by storage, from energy transmission (transport) to pollution reduction.

Participation, however, is only the first step. California will ultimately need storage to store more energy for longer periods of time –meaning storing power through the winter not just from midday to dinnertime – in order to support the shift to high levels of renewable generation that will be occurring by 2050. Current energy storage technologies are not well-suited to this task. Innovation and technological advancement will need to occur between now and 2050 for storage to be maximally effective. And while this largely falls on researchers and engineers, policymakers and regulatory officials have an important role to play in mobilizing state budgets and resources towards this end.

A final thought

Storage is no doubt an exciting prospect for California. Fully realized, it will bolster the state’s energy reliability, shore up the strength and flexibility of the grid, and assist with the integration of renewable energy – all in service of the state’s clean energy goals which can in turn serve as a model for the rest of the world. In the same breath, storage can’t be carried on excitement alone. Policymakers, regulators, researchers, and energy suppliers will need to work together to meet the hefty expectations being placed on storage’s shoulders. This will mean passing legislation, mobilizing state budgets and resources, and utilizing regulatory authority in support of developing and deploying storage technology. California has already seen the success it can have when it boldly commits to storage – the next several decades are no different. Energy experts already know what storage can do, but what it will do in California in the next thirty years is now up to the state – only time will tell.

If five facts weren’t enough for you and you would like to learn more about storage in California, read our in-depth explainer, Energy Storage in California.