Storage in the Northwest: Overview of Threats and Opportunities

Last week I had the opportunity to open up day 2 of the Northwest Demand Response + Energy Storage Summit. I gave an overview of what is happening with energy storage in the Pacific Northwest.

What Is the Current Market?

The region has a long history with pumped and dispatchable hydropower, so energy storage is not a new concept. However, battery powered systems are relatively new. Since 2010, many utilities have deployed 22 MW worth of projects for research, development, and pilots. Some of the larger projects include Portland General Electric’s Salem Smart Power Center and Puget Sound Energy’s Glacier Project. In the near term, the region’s pipeline for non-hydro project is small, but several drivers are quickly changing that.

Energy Storage Tracker for Oregon, Washington, Idaho, British Columbia, and Montana

(Source: Guidehouse)

What Is Driving Growth?

Key drivers for new storage developments include resilience needs, evolving business models, renewables integration, and greater access to financing, but the largest drivers are the following:

• Policy: In Oregon, House Bill 2193 is requiring all investor-owned utilities (IOUs) to procure at least 5 MWh (but up to 1% of 2014 peak load) worth of energy storage. In Washington, the Clean Energy Fund has sponsored many storage demonstrations and the Utilities and Transportation Commission has directed all IOUs to include energy storage in their integrated resource plans.
• Improving project economics: Energy storage costs continue to fall and we expect that to continue. Falling costs make energy storage competitive in more and more applications.
• Customer interest: Customers of all types—from residential to large industrial—are getting interested in energy storage to help manage energy costs, provide resilience, and support sustainability.

What Barriers Does Storage Face in the Region?

Potential barriers that could slow down storage deployment in the region include the following:

• Business models: Not finding the right regulatory and business models that allow a range of values to be captured for individual projects.
• Pilots and projects: Poorly executed and evaluated pilots and early projects.
• Technology issues: Technology—including communications, data gathering and management, and operations—that is not ready for energy storage.

Click here for a copy of my presentation.