Grid Managers Ease the Way for Growing Energy Storage Paired w/ Solar

23 Jul 2020

The California grid operator agreed to allow owners of power plants that include both solar and batteries to operate the two sources in tandem.

The California Independent System Operator board approved the change July 22 in response to the surging trend of pairing energy storage with solar projects. It is aimed at filling the 3,300 MW gap at peak hours, in part due to retiring natural gas-fired power plants.

The change goes into effect in the fall.

CAISO Market Policy Executive Director Greg Cook noted strong interest from developers in adding more storage to existing solar and other generation sites. Adding storage adjacent to operating solar and wind plants is faster and less expensive than installing arrays of batteries in separate locations. Existing power plants already have step-up transformer equipment and interconnections to the grid. Most new storage is expected to be co-located with solar plants.

Co-located projects schedule and bid their megawatts separately into the transmission market. Currently, a solar or battery array can only sell into the market the amount of power it bids in earlier. But weather and time of day impact how much each can actually provide. (The total megawatts are limited to the point of interconnection capacity cap.)

The new rule would allow the solar and storage projects to put in bids above the interconnection cap. They then can vary how much each actually supplies as long as they don’t exceed the interconnection limit. 

For example, if the interconnection limit of co-located resources is 100 MW, the solar project could bid in 100 MW and the storage 50 MW. If it is a sunny day, the solar facility could produce and send into the market 85 MW, with the other 15 MW met by the batteries.

As Susan Schneider with Phoenix Consulting explained, the plants’ output is complementary.

The new policy is limited to energy only bids, in which an operator is paid for power actually provided. CAISO is expected to expand the newly adopted policy to its capacity and ancillary services market in the fall of 2021. The capacity market is where operators are paid for the promise of power, whether or not they provide it.

The system operator also is working on easing the way for hybrid projects, largely combined storage and solar projects, which in contrast offer one combined bid, not two separate ones as from co-located projects. Hybrids are not allowed to deviate from their scheduled bids even if the solar can ramp up and batteries can ramp down in response to real time conditions.

Board member Severin Borenstein pointed out that storage paired projects responding to real time conditions is what hybrid systems are designed to do.

The amount of proposed energy storage is surging. There is a whopping 69,193 MW of storage projects in the CAISO interconnection queue, the board learned at the Wednesday afternoon meeting. More than 68,218 MW are proposed battery projects. Of the total, 51%, or 35,540 MW, are to be joined with solar or other renewable facilities.

“There is more storage in the queue than renewables,” Bob Emmert, CAISO’s Sr. Manager, Interconnection Resources, said.

The board also was told that supplies are expected to be sufficient this summer, despite a drop in California hydropower resources. Northwest hydropower imports that fuel the state during heat spells, however, is at 95% of the annual average.

CAISO also noted overall load continues to be lower, due to disrupted work patterns. It’s between 5-8% lower during the week and up to 4% lower on weekends. Thus, the grid operator is seeing lower peaks in power demand.

-Elizabeth McCarthy

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