The Energy Storage Promotion and Deployment Act of 2015, recently introduced by Sen. Marin Heinrich (D-NM) and Sen. Angus King (I-ME), seeks to create a National Energy Storage Standard. Similar to a Renewable Portfolio Standard, the storage standard would require electric utilities to meet a percentage of their generation via storage, in this case 1% of peak demand using any energy storage technology by 2021 and 2 percent by 2025. In real terms, utilities would have to add 8 GW of storage by 2021 and 18 GW by 2025.
Available technologies range from electric and thermal salt batteries to pumped hydro storage and flywheels. When the amount of generated electricity exceeds real-time demand, the electricity can be stored using these technologies and deployed during hours when the ability of generation assets to meet demand is exceeded. In addition to alleviating peaks in demand, this ‘load-leveling’ can also assist in the integration of distributed renewable energy onto the grid and reduce greenhouse gas emissions by limiting the need to rapidly ramp up electricity generation, which can be very inefficient.
Still, emerging storage technology faces planning, procurement and pricing challenges. To effectively utilize storage, utilities and regulators will need to identify the optimal location to place assets. Determining who should be responsible for purchasing storage devices can also be difficult, particularly in states where a utility must get regulatory approval for such investments. Finally, the lack of a clear mechanism to accurately value and therefore price stored energy injects a great deal of uncertainty into the market.