We often hear that energy storage is a few years behind the solar industry. Comparing these industries’ respective trade shows helpfully illustrates this point.

Solar Power International drew 18,000 people to Las Vegas in September, with panels sprawling throughout the convention center and two massive expo floors. There were espresso bars, two-story display stands and plenty of lights, shiny things and after-parties at swanky Vegas nightclubs.

By contrast, the 2,000-person Energy Storage North America in San Diego last week felt quiet and provincial, closer to a hometown parade than a county fair. The expo had some familiar names from SPI, but focused more on fostering conversations between like-minded storage wonks than on wowing an audience with bells and whistles.

Many of the conversations at the conference dealt with how to put storage on track to where the solar industry is now. Most of the air time went to addressing policy and regulatory obstacles so that the existing storage technologies can get paid for the services they provide. There weren’t any earth-shaking revelations, but a steady march toward the boom that the industry and its observers have predicted.

Here are a few of the insights stumbled upon while wandering the halls.

Massachusetts storage companies are getting fired up

At the state level, California has long dominated the storage game, having passed the first statewide storage mandate in the U.S. back in 2013. Employment in the storage industry is correspondingly concentrated in California.

This summer, the Massachusetts legislature authorized the state’s Department of Energy Resources to decide if it thinks a target would make sense. That same department released a study last month saying that up to 1,766 megawatts of storage capacity would provide a net benefit to ratepayers, so chances are good that a target will become reality.

This, plus New York City’s new 100-megawatt storage target, creates the strong possibility of a high-growth market in New England. There’s already a cleantech hub around Boston, and companies based there will be well placed to nab new contracts. The opening of a new market there could create space for new companies to jump in as well.

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As the demand for clean energy rises, so too has the demand for energy storage. Batteries and other storage products extend the ability of renewable energy systems to provide clean power when the sun isn’t shining or the wind isn’t blowing. In the last few years, Aquion Energy introduced innovative, saltwater-based electrochemical batteries. Recently Aquion commissioned its first battery system in Africa. Together with SolarAfrica, an African solar energy services company, Aquion transformed power generation and supply at the Loisaba Conservancy.

This world-class ecotourism destination and hub for wildlife research in Kenya, East Africa, is far from any power grid. “Loisaba comprises 56,000 acres of pristine lands, populated by hundreds of animal species and enjoyed by thousands of visitors and guests each year,” says Tom Silvester, CEO of the Loisaba Conservancy.

Guests and staff of the conservancy used to put up with noisy diesel generators. Now, Loisaba has a microgrid consisting of two independent systems, each of which has 106 kWh of Aquion batteries paired with a 37 kW solar array. The microgrid powers a commercial laundry, swimming pool, kitchen, business services, lighting, cooling, and other facility loads during the day. It also charges the Aquion batteries, which discharge overnight and during cloudy periods.

“We embrace the idea of living lightly on the earth, minimizing our carbon footprint and maintaining a clean, safe, and sustainable environment,” says Silvester. “The use of Aquion saltwater batteries in tandem with SolarAfrica’s solar powered solutions is perfectly aligned with our approach to preserving nature, enabling us to generate power from the sun and store it for later use.”

Off-grid microgrids, common at remote lodges, have often relied on diesel fuel, which has a large carbon footprint and, in some regions, can be painfully expensive. With the solar power system and storage, Loisaba expects to reduce diesel consumption by 95% and save 53 tons of CO₂ per year.

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The federal agency that tries to ensure equal access to the nation’s grid is holding a technical conference to see how energy storage can weave itself more efficiently into generation, transmission and distribution. It will be November 9.

“The Commission wants to explore the circumstances under which it may be appropriate for electric storage resources to provide multiple services, whether the RTO/ISO tariffs need to include provisions to accommodate these business models, and how the Commission may ensure just and reasonable compensation for these resources in the RTO/ISO markets,” says the Federal Energy Regulatory Commission, as noted inEnergyChoiceMatters.com. 

“The subject of the conference will be the utilization of electric storage resources as transmission assets compensated through transmission rates, for grid support services that are compensated in other ways, and for multiple services,” FERC said.

What’s to be discussed?

— the potential models for cost recovery for electric storage resources utilized as transmission assets, while also selling energy, capacity or ancillary services at wholesale;

— the potential models to enable an electric storage resource to provide a compensated grid support service (like a generator providing ancillary services under a reliability must-run contract) rather than being compensated for providing transmission service, and

— the practical considerations for electric storage resources providing multiple services at once (i.e., providing both wholesale service(s) and retail and/or end-use service(s)).

“A flexible grid is more efficient and reliable — for all types of generation,” says Matt Roberts, executive director of the Energy Storage Association, in a Twitter exchange with this writer. “It’s is already commercial. It’s value is to make the grid more flexible and resilient — not to be a savior for renewables.”

The common perception is that the energy storage is used to harness electrons and to release them later on when the sun is not shining or the wind is not blowing. That’s a bit further out. The reality is that energy storage is now used to smooth out fluctuations in voltage — to prevent the lights from flickering out.

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The combination of battery storage and solar is beginning to take off, and project developers are working to position themselves for more installations. Borrego’s new division recalls Tesla’s acquisition of SolarCity, announced this summer, but on a smaller scale. 

Borrego will focus on long-duration energy storage, which officials say is necessary to integrate renewables into the grid. 

“We’re realizing that all across our customer base—from cities, school districts and public agencies to businesses, manufacturers and electric utilities—it is more frequently making economic sense to evaluate energy storage in conjunction with solar,” said Berwick. “We knew that this technology shift was around the corner.”

Borrego’s storage unit will spend the next year focusing on developing megawatt-scale projects with utilities across the United States. “It’s something that our customers, electricity regulators and policymakers are asking for,” said Borrego Solar CEO Mike Hall.”

While Tesla has many residential offerings, the deal with SolarCity may yield even greater value in the utility sector. Last summer, Tesla founder Elon Musk told the annual convention of the Edison Electric Institute that he anticipates the utility-scale Powerpack storage product will comprise between 90% and 95% of Tesla’s total stationary storage sales.

On the residential side, Navigant has forecasted the 2025 North American market for residential solar PV plus energy storage nanogrids to be over 1.8 GW, with 30% to 40% of those nanogrids aggregated into virtual power plants. The use of solar and storage together in nanogrids is expected to continue expanding, leading to “new organized markets for ancillary services and efforts by utilities and grid operators alike to manage increased DER portfolios in ways that capture value upstream.”

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They may not get it this year, but boosters of energy storage technologies want their sector to get the same tax credits that the federal government extends to the wind and solar industries.

“It would be a good economic investment for us as a government and as a nation to invest in advancing these technologies,” said Matt Roberts, executive director for the industry’s trade group, the Energy Storage Assn.

Under a bill introduced by Sen. Martin Heinrich (D-N.M.), qualifying energy storage technologies such as batteries, thermal energy storage and regenerative fuel cells would get a 30% investment tax credit.

The Heinrich bill essentially runs parallel with the 30% tax credit that wind and solar receive from the federal government and, like the wind and solar credits, eventually would taper off.

Reps. Michael M. Honda (D-San Jose) and Tom Reed (R-N.Y.) have introduced a similar but more complicated bill in the House of Representatives.

The prospect of a tax credit created some buzz at the Energy Storage North America conference that wrapped up Thursday in San Diego.

“Storage is too expensive,” said Keith Martin, an attorney at the Washington, D.C., law firm of Chadbourne & Parke, one of the panelists at the conference. “If the government can help with the cost-sharing, it will then get more people into the market.” 

Under current rules, energy storage can receive a federal tax credit only if it is paired with wind and solar electricity production, most often seen when a storage component is matched with a rooftop solar system.

The proposed legislation would establish tax credits for standalone storage systems.

Extending the tax credit “would encourage deployment of storage throughout our electric power sector,” said Janice Lin, executive director of the California Energy Storage Alliance, an advocacy group. “The consequences of that are dramatic for ratepayers.”

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Wet’n’Wild Hawaii and Stem Inc have activated a large customer-sited energy storage system in Hawaii, connecting mutiple sites. According to a press release, the system has been supported by Hawaii’s Energy Excelerator, the Hawaiian Electric Company, and the US Department of Energy’s SunShot Initiative.

As for specifics, the storage system, equaling 108 kilowatts / 216 kilowatt-hours, represents an important stage in the deployment of storage solutions, stated  Tad Glauthier, vice president of Hawaii Operations at Stem last January:

“By providing increased visibility and control of customer-sited resources, Stem is adding a new arrow to utilities’ quivers and turning a challenge into a solution. This project not only supports Hawaii’s goal of 100% renewable energy by 2045, but also serves as a replicable model for global energy companies of how today’s distributed resources can truly compete with traditional, fossil fuel-based alternatives.”

This storage endeavor is part of a three-year pilot to deploy electric storage systems at about 30 local businesses on O‘ahu, Maui, Hawaii Island, using Stem’s storage solution.

The platform goal is to help improve reliable electric service for customers of utilities with high levels of rooftop solar and other distributed energy resources. The project will be part of the U.S. DOE SunShot Initiative’s “Sustainable and Holistic Integration of Energy Storage and Solar PV (SHINES)” to demonstrate visibility and control of edge-of-network resources.

“Hawaii’s renewable energy growth and isolated location present unique and significant challenges for local grid operators,” said John Carrington, CEO of Stem. “Utilities and regulators are watching Hawaii to determine the viability of storage-enabled grid services. We are proud to be working with Hawaiian Electric to address those grid challenges with our technology.”

Deploying its software platform, supported by real-time data and predictive analytics, Stem will work to better integrate energy storage at customer sites to help customers manage their loads and provide the Hawaiian Electric Companies with grid responsive resources. For the first time, grid operators will be able to see and manage customer-sited resources, including energy storage, alongside conventional generation resources from their existing control platforms.

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Spanish researchers have developed a system based on molten silicon that can store solar energy ten times more efficiently than existing storage systems.

The war between solar homeowners and utility companies has been an ongoing, fierce fight. Homeowners with rooftop solar want to be compensated at retail rates for the energy they feed back into the grid. Meanwhile, utilities want to maintain lower rates and keep control over the centralized grid. Residential energy storage could help solve these issues.

Through a collaborative and cooperative effort, utilities and residential solar storage owners could build a stronger, more reliable distributed electrical grid. To move forward, it’s necessary to take advantage of new technology, open up communication and give up control. The technology is here, and costs are down, making a battery-based distributed grid more possible now than ever. With a distributed grid, everyone wins.

Using advanced tech and communication

The growth and advancement of technology, especially in the solar and energy storage sector, has been on an upswing in the last decade. The electrical grid infrastructure, however, remains largely unchanged. Systemic change on the utility side will inevitably be slow, but it’s time for utilities to catch up with the growth of energy technology. The companies that do this will be able to do their jobs better – namely, continue to reliably meet energy demand.

Solar photovoltaic installations are on the rise, and more and more solar homeowners are looking for a way to store the energy generated by their panels. As a result, the battery business is booming, with many big brands unable to meet the growing demand. This means that residential energy storage capacity, especially in locations like Southern California, is rising, even though that storage capacity isn’t owned by utilities.

But just because utilities don’t own it, that doesn’t mean they can’t or shouldn’t use it. Another area of major technological advancement is the progress of communication. It’s time for utilities to start using that, too.

In a world of lightning-fast information exchange, it’s surprising how little utilities and customers are communicating. There have been many compromises proposed to wage peace between solar homeowners and power companies, but there hasn’t been a lot of talk of the free-flowing information. Communication, itself, could be the compromise everyone is looking for.

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Elon Musk has had a good couple of weeks as the Tesla (NASDAQ:TSLA) stock price has shown recently. Very strong Q3 auto sales are expected to continue into Q4. Musk’s talk about his Mars colonization plans, though typically highly ambitious, were well-received by all but the usual Tesla Musk bears. Recent commercial storage orders have been less emphasized but represent further strong gains for the company.

Those writers who criticize Musk’s vertical integration model for new energy products are either hooked up with the fossil fuel industry or fail to understand the way the world is going. Chinese manufacturer BYD Company (OTCPK:BYDDY) have already gone a long way down that road, and have been very successful accordingly. They have just launched a new energy storage system in Europe using lithium iron-phosphate batteries.

Tesla is now consolidating its vertically integrated new energy systems. This will tie in their interests in electric vehicles (EV’s), rooftop solar and energy storage systems. Success is coming remarkably quickly now in their energy storage business. This is happening as the Gigafactory production ramps up and approvals are received. There is a huge market appearing rapidly for cost-effective energy storage which can overcome the mismatch between renewable energy supply and energy demand.

Commercial Gains.

In September the California Public Utilities Commission awarded the world’s largest lithium ion battery storage project to Tesla. The company will provide a 20 MW/80 MWh Powerpack system at the Southern California Edison Mira Loma substation. This was necessitated by a huge and polluting rupture in the Aliso Canyon natural gas reservoir. 15 million residents were potentially affected.

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Borrego Solar Systems Inc., a provider of large-scale solar development, design, financing, construction, and operations and maintenance, has announced its entry into energy storage solutions with the launch of a new division. This marks the company’s first-ever formal expansion into energy services beyond solar PV. The company will be offering both stand-alone energy storage solutions and storage integrated with solar PV.

“We’re excited to launch this new chapter, as a way to further our mission of accelerating the adoption of renewable energy,” said Borrego Solar CEO Mike Hall. “Energy storage – and, in particular, the long-duration energy storage on which we’ll be focusing our efforts – is an important piece of what we need to effectively integrate more and more renewable energy into our electricity system, and it’s something that our customers, electricity regulators and policymakers are asking for.”

The energy storage division will be based in Massachusetts and will serve customers nationally. Borrego Solar’s executive vice president of strategy and business development, Dan Berwick, will lead the new division.

“We’re realizing that all across our customer base – from cities, school districts and public agencies to businesses, manufacturers and electric utilities – it is more frequently making economic sense to evaluate energy storage in conjunction with solar,” said Berwick. “We knew that this technology shift was around the corner given the changes happening to the grid as we add more wind and solar power to it. As climate change becomes an increasingly present danger, and the need to decarbonize our electricity system more immediate, the distributed energy marketplace will demand greater amounts of flexible energy storage. We’re now prepared to meet that need.”

Over the coming year, Borrego Solar’s energy storage division will focus on supporting utilities across the U.S. in the development and installation of megawatt-scale energy storage systems for integration with renewables and peak-load management. The team will also offer energy storage solutions to its existing solar PV portfolio, totaling more than 400 MW, and to new solar customers, which are primarily large-scale electricity users in its core state markets of California, New York and Massachusetts.

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