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CAISO & RGI Outline Vision for Storage in Evolving Grid


Storage: Cure for the Duck Curve

Source: Energy Storage: Perspectives from California and Europe, CAISO & RGI, Nov 2019

Energy storage, everyone agrees, is among the game changers of the decade of 2020s. The reasons should be obvious, but for anyone in doubt, a causal read of the IEPR should suffice. Simply stated, as more renewables are added to the electricity mix nearly everywhere, the variability of the generation rises and so will be the need for more flexible ramping resources – say peaking plants – and/or storage (visual). Other well-known solutions include more flexible demand and/or demand response.

Storage, of course, comes in a variety of forms and technologies, which essentially fall into one of the following 6 types (visual):

  • Mechanical or kinetic;
  • Electromechanical;
  • Electrical;
  • Chemical;
  • Thermal; and
  • Thermochemical.

Within each category, there are multiple ways of storing energy – some better known such as batteries or hot water tanks, others less known such as super-capacitors or flywheels. Some can store large amounts of energy for long periods, say pumped hydro storage, while others can store smaller amounts and for short duration, such as super-capacitors. Some are advanced and mature technologies, such as pumped storage while others are on the drawing board or under development such as compressed air.


Energy storage technologies

Source: Energy Storage: Perspectives from California and Europe, CAISO & RGI, 2019

A report jointly prepared by the California Independent System Operator (CAISO) and the Renewables Grid Initiative (RGI), a European consortium, describes the growing challenges and opportunities of energy storage in the shift to the clean power grid of the future. The repot outlines the barriers of deploying energy storage worldwide and paths to create “adequate reward mechanisms” for commercial storage investments.


As storage R&D booms technological breakthroughs will follow

According to Rob West of Thunder Said Energy, 275,000 battery patents have been filed since 2000, 36,500 in 2019 alone, with more expected in 2020.

With so much investment and effort going into energy storage, one would expect major breakthroughs in the years to come. A newly formed Consortium for Battery Innovation (CBI), for example, recently announced its 100th corporate member. CBI’s mission is to boost advanced innovation in lead battery technology for energy storage and other applications. 

In 2019, US energy storage using batteries doubled from the 2018 record of 311 MWs. with a tripling expected in 2020. Investment in energy storage systems (ESS) is expected to rise to $9 billion in the US alone by 2024. That may sound like a lot but is miniscule compared to the $356 billion invested in renewable electricity generation since 2010 with installed capacity quadrupling by the end of 2019. n

The report, Energy Storage: Perspectives from California and Europe, identifies energy storage as one of the critical solutions to challenges presented by rising amounts of renewable resources in the energy mix. Writing in the report’s Foreword, Steve Berberich, CEO of the CAISO, notes,

“Economical grid-scale and distributed storage has the potential of completely transforming the electric industry,” adding, “Planning processes, operations, markets and the role of utilities will all be impacted by large- scale deployment of storage.”

Focusing on California, Italy and Germany, the report outlines the evolving trends of storage and summarizes the “game-changer” role of energy storage as grids transition to more variable renewable generation; explains the different types of emerging technology and the status of commercialization; and describes strategies for storage asset operators to complement revenues from ancillary service markets for electricity grids.


Global storage market projections to 2040 in GW

Source: Energy Storage: Perspectives from California and Europe, CAISO & RGI, 2019

CAISO describes several of its ongoing market and infrastructure policy initiatives to remove obstacles and boost operational value of storage resources in the wholesale energy markets, including regulation energy management to allow storage assets to participate fully in ISO markets; Energy Storage & DERs (ESDER) initiative designed to enhance accounting, visibility and control of energy storage; and describes the concept of storage as a transmission asset (SATA), which will open the door for storage resources to provide transmission support.

The report also lays out recommendations for incentivizing storage development, including integrating essential ancillary grid services, such as voltage and frequency control and ramping capability into storage deployment; matching technologies with local market dynamics and combining solar photovoltaics (PVs) with storage.

The size of the market is currently miniscule relative to the size of global installed capacity. As of September 2019, there were some 1,300 small to medium sized operational units globally totaling 188 GW, approximately 2% and 5% of total installed generation capacity, in the US and Europe, respectively. As a point of reference, there will be over 142 GW of new solar added in 2020 alone, with approximately similar amount of wind and other renewables.


US storage market

Source: Energy Storage: Perspectives from California and Europe, CAISO & RGI, 2019

According to Bloomberg New Energy Finance (BNEF), global battery storage may grow to 2,850 GWh by 2040 requiring an investment of $662 billion. This significant investment, however, is needed in view of the variability of renewable generation resources. The International Renewable Energy Agency (IRENA) says a tripling of current storage capability is required to double renewables in the global energy system by 2030.  

This explains the expected exponential growth of storage based on projections from the Bloomberg New Energy Finance, which shows global projections for 2040 for the US (above) as well as for the European market (Visual next page).


European storage market

Source: Energy Storage: Perspectives from California and Europe, CAISO & RGI, 2019

Not only will storage be needed to address the variability of renewables but in some cases, to replace existing polluting natural gas peakers.

As noted in the following article in places targeting virtually 100% renewable electricity generation mix, all or virtually all fossil-fuel sources of generation, including any gas peakers, will have to be eliminated – some of which to be replaced with storage devices.

This article originally appeared in the February 2020 issue of EEnergy Informer, a monthly newsletter edited by Fereidoon Sioshansi who may be reached at

Fereidoon P. Sioshansi, Ph.D.'s picture

Thank Fereidoon P. for the Post!

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John Simonelli's picture
John Simonelli on Feb 9, 2020 4:12 pm GMT

As the article points out massive amounts storage will be needed if the country is to truly move toward societal electrification concurrent with high penetration of renewable. The article focuses on the types of storage, improving current storage technology and, cost of storage. There are other issues that will continue to dog storage. Siting remains a challenge for just about any project.  NIMBY and BANANA continually lead to difficulty getting necessary siting approvals. Related to that is building the necessary transmission to integrate storage and renewable energy where it is needed, siting and cost being the biggest.  Then as the article alludes to, significant changes may be required to implement necessary market rules changes to adequately value storage.  Changing market rules in the RTO/ISOs environment is in of itself a tremendous challenge. So there are numerous hurdles that the industry must overcome.

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