Energy storage is increasingly being included in utilities’ chief planning tool: the integrated resource plans (IRP). That inclusion is a sign that utilities are beginning to see the value and benefits that energy storage brings.
“Utilities are becoming more active players in the energy storage market,” Brett Simon, energy storage analyst at GTM Research, told Utility Dive in an email.
A significant number of utilities now include energy storage in their IRPs, including Arizona Public Service, Tucson Electric Power, Florida Power and Light and Puget Sound Energy.
PG&E’s contract with EDF RE does not come as a surprise, Simon said. Like California’s other two investor owned utilities, PG&E is required to procure energy storage under AB 2514 that was passed in 2010.
Some foreign utilities have also shown an increased interest in the storage market over the last 12 to 24 months, Simon says, citing ENGIE and Enel.
ENGIE North America and Holyoke Gas & Electric in October said they plan to build a 3 MW, 6 MWh storage project at a Massachusetts solar farm that used to house a coal plant. Also in October, Enel told Bloomberg that the company is looking for energy storage acquisitions.
“This is a trend I’d expect to continue as storage economics continue to improve and utilities begin to explore new technologies to ensure effective system operations in the face of a changing grid,” Simon said
In the PG&E deal, EDF RE will build, own and operate a portfolio for PG&E that will include behind-the-meter battery storage projects for commercial and industrial customers in PG&E’s service territory.
The aim of the projects is to help C&I customers to lower their electric bills by reducing their demand charges and maximizing consumption during off-peak hours, as well as bringing in revenue by using storage to provide services to California’s wholesale power market.
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