By Michael Kuser

NEW YORK — Energy storage developers and utilities in New York are working with NYISO to establish dual participation of storage in retail and wholesale markets.

The goal is to boost storage growth “to get to the gigawatt level, where just five years ago we were talking about one megawatt,” Martha Symko-Davies said in New York on Thursday.

Symko-Davies, program manager for energy systems integration at the National Renewable Energy Laboratory, headed a panel on storage integration at the Infocast New York Energy REVolution Summit held last week in Times Square.

The panel discussed the industry’s progress since FERC last November issued a Notice of Proposed Rulemaking aimed at knocking down market barriers to storage and distributed energy resources (RM16-23, AD16-20). (See FERC Rule Would Boost Energy Storage, DER.)

Tim Banach, vice president of development for microgrid developer GI Energy, said that in the past, “there was little to no coordination with the utility around where these projects would be sited and what impacts the projects might have on the utility grid, both beneficial or potentially doing some harm.”

Now GI Energy is working with U.K.-based software developer Smarter Grid Solutions on storage demonstration projects for Consolidated Edison.

Graham Ault, executive vice president of Smarter Grid, said his company has mainly developed technology to manage DER for utilities. “The same technology as developed for and used by utilities is highly relevant to the owners and operators of fleets of DER, and that is what we as a company are addressing,” Ault said. “The GI Energy-Con Edison project is an excellent example of that.”

Adrienne Lalle, project manager for Reforming the Energy Vision (REV) demonstration projects at Con Ed, said: “We, through our value-stacking goal, are big supporters of dual participation and using the assets for utility grid support and wholesale markets. It enables developers like GI Energy to offer lower-cost storage solutions to us.”

Simple to Understand

Brian Asparro, chief commercial officer of Demand Energy Networks, said technology must be straightforward to win customers. The company, which in January was acquired by Italian energy giant Enel, provides turnkey services for storage and DER.

On a recent project in Brooklyn, the company used its software to reduce demand charges for Con Ed customers and help the utility manage load reduction on its local network. (See NYPSC Extends Con Ed Demand Program.)

And customers also want resiliency so that in the case of an outage, critical elements of a housing or office complex can keep running, Asparro said.

Banach said that it was sometimes a challenge to educate owners of multi-family housing complexes or commercial enterprises — people whose expertise is not energy — on how storage projects were going to affect their energy bills. His company needed to explain “stand-by rates, contract demands and effects to ICAP [installed capacity] tags, so it was a constant requirement to educate.”

Now it’s a simpler real estate transaction between the developer and the host site, which can rely on predictable lease payments, Banach said. “We are now able to participate in wholesale markets and generate additional revenues. Ultimately our hope is to demonstrate that by stacking all these revenues, we can lower the cost of service to the utility for the energy services provided and provide ratepayer benefits through an effective and targeted non-wires alternative,” he said.

Lalle said Con Ed is looking to simplify the value proposition for the customer by disconnecting the project economics from the customer load profile, bringing the battery in front of the meter but providing a customer with a lease payment for the space.

“So, you get all the benefits of distributed storage,” Lalle said, “but you can add a utility value by directing the location strategically to a network constraint, sizing it a little bit bigger so that we can possibly offset some [transmission and distribution] investment and make the dispatch coincident with the network need as opposed to the customer load profile.”

Alignment Needed

John Bellacicco, director of Northeast operations at Stem, which focuses on behind-the-meter storage systems, said: “One of the biggest monetizable value streams today for energy storage is demand management, and the best way to get customer participation, especially when we think of REV and how REV wants to bring the customer into it as a prosumer, is to put the energy storage behind the meter and to have the customer participate.”

In front of the meter or behind doesn’t matter to Ryan Wartena, president and cofounder of Geli (Growing Energy Labs Inc.), an Australian company that develops software and services for storage and microgrid systems.

Wartena said he spent years developing batteries “until I realized that you can give the world an everlasting, almost free, solid-state battery, but no one’s really going to know how to use it. We have to think about batteries as a hard drive, where you can co-optimize, run multiple applications. So that’s where our initial intellectual property is.”

A developer can do demand charge reduction behind the meter and be available for wholesale participation, which Geli is doing now in Australia.

“Australia has a different market than the United States does, for they expose wholesale prices to residents,” Wartena said.

Wartena emphasized the need for alignment between developers and utilities. “Not just nodal to nodal, but if it’s a huge market price, I’m going to punch out a megawatt right now,” he said. “But my local distribution system does not want me to do that. The problem is you’re trying to feed the wholesale market from inside the mothership and you’ve got to use the mothership’s pipes, so there has to be that alignment, and that software, and that’s a lot of work to get that type of alignment.”