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Can Customer Energy Storage Improve Grid Reliability?

Posted to Electric Power Research Institute (EPRI) in the Grid Professionals Group
Sara Mullen-Trento's picture
Strategic Issues Lead, Technology Innovation Electric Power Research Institute (EPRI)

Dr. Mullen-Trento is the Strategic Issues Lead in the Technology Innovation (TI) program at the Electric Power Research Institute (EPRI), she originally joined EPRI in 2007. Dr. Mullen-Trento...

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  • Jul 16, 2021 10:42 am GMT
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Amid increasing demand for carbon reduction and clean energy, electrification is becoming increasingly important to enabling vital services and infrastructure. Through this expanding presence, electric power systems must adapt to support new dynamics of energy generation and consumption, as well as the increased volatility from severe storms and other grid impacts. The result is an increased focus and prioritization from utility and system operators on identifying and improving resource adequacy (RA) practices to create more resilient energy systems for society.

The RA challenges identified in our 2020 assessment were recently brought back into public attention through extreme weather situations in California in 2020 and Texas earlier this year.

In August 2020, the California Independent System Operator (CAISO) was unable to maintain its load-plus-operating reserve obligation and began initiating rolling customer outages lasting several hours to reduce the risk of longer-duration, widespread blackouts. This incident occurred despite a recent spike in residential adoption of large storage plus solar photovoltaic (PV) systems, which are capable of providing backup power for days in the right conditions. Given increased adoption following widespread wildfires and the introduction of public safety power shutoffs in 2019, distributed energy resources (DER) may have mitigated a portion of the risk CAISO was facing.

Another example in which customer energy storage could have alleviated strain on the grid occurred Texas in February. Similar to the circumstances in California, unseasonable, extreme temperatures threatened the reliability of the state’s energy grid. This situation brought to light another opportunity to leverage customer energy storage to provide short-term relief to the grid.

Consumers who invest in residential storage typically do so to maximize their energy cost savings and provide personal backup power. On the system level, depending on operating objectives and price signals, customer-owned energy storage system operation may increase net load during system peak hours or fail to decrease net load. For example, a battery management system could work to maintain a high state-of-charge (SOC) to mitigate the risk of losing power in the rolling blackouts caused by a potential system capacity shortfall. Where the system normally would have discharged, the SOC could be held constant as the gap narrows between net load and supply, until the system’s owner intervenes. When bulk system reliability is at risk, there is an opportunity to leverage customer-sited storage systems as a distributed contribution to reserve margins.

Exploring the Impacts of Residential Storage Control Strategies

To better understand how residential battery storage may impact rolling outages, EPRI conducted an illustrative analysis that looks at load shedding, owner incentives, and price signals. This study used DER-VET™, an open-source techno-economic optimization and simulation tool, to first size and then simulate the operation of a residential battery plus PV system responding to various price or direct control signals.

This analysis considers five battery charge control scenarios based on:

  • A time-of-use electricity rate;
  • Federal Solar Tax Investment Credit (FITC) compliance (charging only using on-site PV output);
  • FITC compliance plus charged for household backup;
  • Participation in a demand response program; and
  • Day-ahead CAISO nodal pricing.

Only in scenario 3 does the storage system retain enough stored energy to cover any three-hour outage throughout the entire modeled day. In all other cases, the system discharges in the afternoon based on relative prices to minimize the customer’s energy bill, resulting in a system that is partially or fully discharged by the time the home’s net load peaks between 6 and 7 p.m. In the other four scenarios, if the battery system were made available for demand response or energy shifting on this day, the battery could ride through any three-hour rolling blackout while still supporting the grid via demand response and achieving its financial objectives.

This illustrates the tradeoff between responding to relative prices or direct load control signals, versus reserving some battery SOC for possible self-backup. Battery plus PV systems of this size may provide backup power for critical customer load for longer durations, such as public safety power shutoffs. The three-hour rolling blackouts of August 2020 did not require as much energy, so the system could reserve ample stored energy for backup and still have enough left over to support the grid in some capacity.

Key Research Needs

While residential energy storage is currently relatively rare, it is likely to become more common in the near future. Appropriate research may enable system operators to use this resource to mitigate, and perhaps prevent, rolling outages or blackouts in the future without compromising customer convenience and comfort.

Utilities and system operators may consider specialized tariffs, incentives, direct control programs, shared ownership, or market services to incentivize beneficial adoption and operation of energy storage, balancing customer, grid, and societal needs. Each of these pathways will impact the level of customer participation, resource response, and the ability for customers to opt out.

The changing resource mix is occurring everywhere along the electricity supply chain, including in homes and businesses, and requires planning that accurately represents the complex interactions of every type of resource. EPRI explores these implications in a new white paper which also includes considerations for bridging the technical gaps to support least-cost approaches to integrating residential storage and other DER into utility operations.

Sara Mullen-Trento's picture
Thank Sara for the Post!
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Jim Stack's picture
Jim Stack on Jul 17, 2021

Sara, Thanks for a timely article. As you know it all depends on how the customers set up their battery storage. That depends on the proper policy and tariff. If they are fairly rewarded they can help during the daily Duck Curve when it's is hard to cover the loads without peaker plants. If it saves them money they will cover it everyday. 

  Customer Battery Storage is not just for covering outages. It can help prevent brown outs and even black outs from high use. a few hundred customers with battery storage is like a huge virtual battery on the GRID. It can be good for everyone but the right policy will make that happen or not.  

Sara Mullen-Trento's picture
Sara Mullen-Trento on Jul 22, 2021

Thank you for the comment Jim! Understanding what signals or inducements customers respond to and how, and their system settings/operation as a result may inform what tariffs, programs, or policies may lead to the greatest benefit from societal, customer, and grid perspectives. Tremendous opportunities for customers and the integrated grid!

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