In recent years, the use of renewable energy has grown so much that three states (Iowa, Kansas, and Oklahoma) have over 30% of their electricity production coming from wind power. Presently, solar is the fastest growing energy type, and annual construction of solar is now beating both gas plants and wind farms in some years.
While these changes have surprised and delighted many observers, the meaning and extent of these changes have been argued, with the issue of energy storage at the heart of that argument. Grid operators have demonstrated that the use of variable solar and wind does not require energy storage to maintain a reliable electricity supply. But in the drive to sharply reduce carbon emissions and achieve 100% carbon free electricity, significant new energy storage would be a welcome addition to the power sector.
Fortunately, research, innovation, and commercial uses for batteries in other products have in fact made large-scale energy storage a contributing part of the U.S. electric power system. In a 10-year period, from 2007 to 2016, battery storage systems on increasingly large scale have taken on all the roles of power plants and done so on a commercial basis. The idea of a battery facility serving as a peaking power plant became a reality with multiple installations of 4-hour batteries as power plants in 2016. This replacement of fossil plants with batteries continues to draw excitement and investment.
Last month, grid operator PJM described its surprise to find that the requests to connect battery projects suddenly totals 6,000 MW. Industry folks were even more surprised that 4,000 of that 6,000 MW of storage will qualify as a capacity resource by meeting PJM’s presently contested excessively restrictive requirements for storage.
The connection requests from commercial interests show the push to build these power plant alternatives. Call it a leading indicator of how much seeks to connect to the power system, not how much will actually be built. Let’s look at these requests for a sense of the present interest in building rather than as a prediction of the future. This 4,000 MW would be over 2% of the 165,492 MW peak demand of the PJM system. In the Southwest Power Pool, the lineup of proposed storage plants is 6796 MW, 13% of the SPP system peak of 50,622 MW. This impressive number comes from 76 total projects, including 13 projects that seem to be hybrid wind and storage or solar plus storage.
How fast did wind come on the grid?
For some perspective, keeping in mind that the queue is not a clear window into what will actually be built, we can look at actual wind deployments for some perspective. In the graph below, see the growth of wind in five states starting from the first year a windfarm was built in that state.
The chart uses the electricity produced in each state by wind as a percentage of the total amount of electricity generated in that state. The line for each state begins when the first windfarm was built and looks at the following ten years to show how wind grew in those states. (In all these states, wind deployment has continued as costs have continued to decline.)
How much is storage coming and where are current proposals?
This table is just a sample of states from the regions served by grid operators MISO, PJM and SPP. The variety of states mirrors the variety of functions for the batteries. Not all of these developers are responding to a capacity market, because most regions don’t have a single price for capacity. Likely, many developments are aiming to supply utilities directly with a flexible, renewable supply beyond the hours of best sunshine or wind. States and their utilities have used all-resource bidding for new resource options to compete side-by-side, with results showing renewables-plus-storage very competitive. Results from Colorado 2 years ago made news and now Los Angeles has contracted for 400 MW of solar generation with 300 MW storage for 4 hours more after sunset, all for less than 2 cents per kWh. Plans and results in Indiana are showing the trend from wind providing low-cost energy followed by low cost solar-plus-storage. Sunny states Nevada and Arizona show the repeated competitive selection of hybrid solutions that combine storage with renewables.
This sort of hybrid is getting investor attention despite the sluggish response of RTOs to sort out the means to accommodate such combined-units in their market and modeling systems. NextEra, one of the most significant owner-operators of renewables indicated to investors that this sort of combination hybrid plant is the wave of the future. They call these plants “near-firm” and are finding utilities interested in buying their solar production after sunset.
UCS has said that if we had cheap and reliable storage, we might see the end of investment in fossil fuels for electricity generation. Now, surprisingly fast, that day may be coming.
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