Energy Storage is Critical Issue at Utility Industry's Conference in New Orleans
- June 12, 2015
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Earlier this week, the Edison Electric Institute (EEI) held their Annual Convention, which brought together leaders from the utility industry for three days in New Orleans. With energy executives from around the world in attendance, attention was squarely focused on the dynamic role of utilities and the evolving electrical grid, and how new assets like energy storage and renewable energy are increasingly augmenting grid operations.
On the 10th anniversary of Hurricane Katrina which devastated the Gulf Coast, the conference highlighted the immense importance of the utility companies in ensuring resiliency and reliability as increasingly intense storms challenge our aging infrastructure.
Energy storage was front and center, starting Monday morning with an overview of the Department of Energy’s Quadrennial Energy Review (QER) which Energy Secretary Moniz described as critical investments given the monumental change the U.S. grid is about to undergo as a result of the EPA’s proposed Clean Power Plan. Energy storage throughout our energy infrastructure is highlighted as one of the key components of the QER, and Moniz indicated he was confident that Congress and the Administration would be supportive of prioritizing these critical recommendations.
The Secretary’s introductory remarks were followed by a fireside chat between Southern California Edison CEO Ted Craver with Elon Musk and JB Straubel from Tesla discussing their entrance into the energy storage industry earlier this year and their vision of the impact electric vehicles and storage technology will have. Peppered with amusing and intriguing anecdotes on his experience driving a culture of innovation in a rapidly growing company, Musk reflected on the unprecedented consumer demand that Tesla saw with the introduction of their new battery storage systems, which drew widespread media attention in May for its simple design and affordability.
Energy Storage was identified as a ‘critical issue’ by event organizers, and later on Monday I moderated a panel with leading energy and technology companies that drew a standing room only crowd and continued the dialogue about the drivers and value proposition of energy storage. Panelists represented an investor-owned utility, a leading energy storage project developer, and three storage technology companies. The conversation featured expert insights into markets, policy and technology, and the many applications of storage in the energy economy.
With a total of 2 million MWh of energy storage service delivered and more than 1,000 MW’s of planned capacity, AES President of U.S. Strategic Business Unit Ken Zagzebski opened the session highlighting his company’s near decade of experience developing, installing and operating some of the largest energy storage systems in the world. Zagzebski focused his remarks on the system-wide benefits of his company’s energy storage installations, and the ability of storage systems to offset the need for new, often underutilized, ‘peaker’ capacity.
Questions quickly brought the conversation to the topic of resiliency and reliability, and Don Clevenger – SVP of Strategic Planning at Oncor Electric Delivery – discussed why his company has supported the need for more than 5 gigawatts of energy storage to be installed on the Texas electric grid. Clevenger highlighted values ranging from ancillary services like frequency response to deferral of expensive transmission and distribution investments as reasons that Oncor should invest in energy storage.
Clevenger noted in particular the benefits of increased system reliability and reduced outages, all while lowering consumers’ electric bills, as the key drivers of Oncor’s support of expanded deployment of distributed energy storage systems.
While all panelists agreed that the storage industry is going to continue its rapid growth, each highlighted current challenges built into regulatory structures and market designs.
With utilities around the world working with EOS Energy Storage, Chairman Steve Hellman highlighted a common thread in global energy markets – the difficulty for companies to capture these multiple value streams and monetize them. Hellman noted that while energy storage provides a number of different valuable services to the grid, current regulations and markets generally make it impossible to monetize all those opportunities.
The session closed with participants’ outlooks on the future of energy storage and a discussion of what we will be discussing at the next EEI conference. Panelists agreed that in a year’s time there will be more experience to draw from, more data to analyze and more progress in creating competitive markets, and that the challenges that exist are far outweighed by the risk of inaction.
Ten years after Hurricane Katrina nearly crippled Gulf Coast states and hundreds of utilities banded together for weeks to bring the area out of darkness, at EEI’s annual event creating a more resilient and responsive energy grid is still a critical priority for the utility industry.