Two key components of the decarbonized grid of the future — distributed energy resources, and the clean, firm power needed to back them up — were the topics of two panels at the two-day American Council on Renewable Energy’s Grid Forum.

The central question for Wednesday’s panel on integrating DERs — both wind, solar, storage and demand response, and their various “hybrid” combinations — across power markets was what’s needed to bring them on the grid in a way that maximizes their multiple value streams while ensuring system reliability.

Taking in a 20-year horizon, MISO is “looking at various ratios of wind to solar to DERs to storage and hybrids,” said Renuka Chatterjee, the grid operator’s executive director of system operations. “As we look at those futures, the thing that we are learning is it’s pretty similar. So, to the extent you can see these resources as similar in the sense that they provide a service, be it energy or ancillary services, you get a lot of common ground.”

In the example of storage, Chatterjee said, MISO treats storage the same as it treats oil or gas, letting “storage manage its own fuel, which is the battery. … So, that allows us to key in [a] market signal that is consistent and unique while enabling the features of these new resources.”

But Jamie Link, vice president for solar and storage at EDF Renewables North America, said such a technology-neutral approach may not be the best for optimizing the value of utility-scale solar and storage projects. With more than 2 GWh of storage under contract in the West, EDF is “quite closely” following CAISO’s implementation of storage integration, Link said.

“CAISO’s resource adequacy market is a bilateral capacity market, which is very strong both on the system and local level in providing value to storage, and storage can also capture value in the energy and ancillary markets in California,” she said.

She pointed to CAISO’s aggregate capacity constraint (ACC) proposal as a model for other grid operators to follow, as increasing amounts of solar, storage and other DERs come online. The proposed rule would allow the ISO to set multiple capacity constraints for co-located solar and storage projects sharing a common interconnection point, so that output from any one project does not exceed the limits of its interconnection agreement.

“So, instead of the project owner having to worry about making sure a dispatch doesn’t violate their contract and having to make a decision on whether to be available, those two things are synched up,” she said.

CAISO submitted the ACC proposal to FERC in September (ER21-2853).

Leveraging the value of DERs at the residential level is even more complex, said Suzanne Leta, head of policy for SunPower. “There is a fundamental right when it comes to distributed technologies, which is consumer choice,” she said. “But in order to enable that choice, we have to have the policy tools in place and the incentives in place for customers to take that leap.”

For example, Leta said, while only 3% of U.S. homeowners have rooftop solar, and only 2% of all car sales are electric vehicles, 40% of EV drivers have rooftop solar. “There’s this automatic connection on the customer end about the relationship between these technologies, and we have to transfer that into getting the rules in place, so the regulators are able to value them in the same way that customers are,” she said.

Allowing Failure and Positive Collisions

The forum’s closing panel on Thursday looked at what many in the cleantech sector believe will be essential for decarbonizing the U.S. grid by President Biden’s target of 2035: the emerging and still-to-be-developed technologies that can provide clean dispatchable power.

But Debra Lew, associate director of the Energy Systems Integration Group, an educational organization, said as levels of renewables on the grid increase, the real need on a day-to-day basis will be flexibility to balance out intermittent wind and solar.

She believes demand-side management is the low-hanging fruit here. “We can do tons of stuff on the demand side, especially today in the advent of electric vehicle charging and [smart] thermostats,” she said.

Building out the grid to allow for cross-region aggregation is another must-have. “Imagine having solar in the Southwest shipped over to the East to help provide for peak hours, or wind from the Midwest being shipped over to the West. There’s a lot you can do with aggregation by building out more transmission.”

The outer edge of flexibility — the days or weeks when sun and wind power may not be available — is where other technologies, such as long-duration storage, come in, though they face considerable obstacles to commercialization, said Thomas Jarvi, director of defense contractor Lockheed Martin’s flow battery program. The company has spent several years developing its new GridStar flow battery, which is in the final stages of verification testing, he said.

Technology developers need “to think about kind of the transactional end state: Who are their customers, and what are their contract considerations? And what does that transaction look like?” Jarvi said. “What are the customers’ buying factors, risk considerations? Can you buy down risk by virtue of government incentives, rate structures, market structures and so forth?”

The investment needed to develop such new technologies is yet another obstacle. While capital markets are “flush with money,” said Lee J. Peterson, senior manager at cleantech investment banker CohnReznick, tax equity markets are still hesitant to invest in emerging products and processes.

“The comfort level with wind and solar is so large that to get tax equity interested in something other than wind or solar is really a challenge,” Peterson said.

His solution is “total optimization of the U.S. tax code for renewables and clean energy in particular,” he said. “I can go through the code and find you a dozen or more little … ‘glitches’ or stops [that] are really holding back the clean energy economy.”

The federal government also needs to play a more active, “first mover” role in de-risking new technologies to help them scale and get to market, Jarvi said. “Other governments understand the implementation of early technology as a key role for the government … because we’re competing in energy technology, always, against massive incumbencies that have volumes baked in already.”

Adria Wilson, U.S. policy and advocacy manager at Bill Gates’ cleantech venture group Breakthrough Energy, pointed to funding in the newly passed bipartisan infrastructure bill for an Office of Clean Energy Demonstrations in the Department of Energy as a step toward that more active role. But, she said, “there should be a more acceptable culture for the government’s projects to fail. I wouldn’t want them all to fail, but I think we would want them to be taking risks and creating knowledge that stakeholders and private industry could use to build on.”

She called for government “convening with people who are more active in the grid space or other sectors who really know what the market needs are. If you can create moments of collision, positive collision between those two groups, it can help direct the flow of innovation funding in a more productive way.”