New York joins California as leader in energy storage (and what it means for your state)
Smart Grid News has recently alerted you to several important developments in energy storage:
I'm watching storage carefully in your behalf because I think its tipping point may be closer than you think. That's why I wanted you to see this guest editorial from energy storage insider Mark MacCracken. - Jesse Berst
By Mark MacCracken
In my last article for Smart Grid News, I discussed energy storage legislation and why it is so essential to preserving the energy grid. California’s Public Utility Commission had just proposed an aggressive energy storage mandate for its three largest utility companies to incorporate 1.3 GW of storage into the grid by 2020. That mandate has since passed, the first of its kind in the world.
Now, New York is taking an aggressive stance on energy storage. It started with an announcement by New York’s governor Cuomo in early February pledging to increase funding for smart grid projects in order to add resilience and efficiency to the electric grid. A few days later, Con Edison, New York City’s primary utility company, announced the preliminary details of the Indian Point Center Demand Management Plan. The proposed incentive plan will leverage energy storage technology to preserve the stability of its power grids and will be administered jointly with NYSERDA, New York’s Energy Resource and Development Authority.
The goal? Grid stability
The goal of the demand management plan is to help address electric grid stability associated with the closing of Indian Point Nuclear Power Plant that will potentially close before the summer of 2016. Indian Point is a 2,082 MW plant that provides 25 percent of the New York City’s electricity. Replacing Indian Point means adding generating capacity and new transmission lines, improving energy efficiency programs and development of wind and solar projects, to maintain stability of the electric grid.
With the demand management plan, Con Edison and NYSERDA aim to reduce energy demand by 125 MW. The majority of that reduction, 100 MW, will be composed of peak demand reduction. Peak demand generally occurs during hot summer afternoons when air conditioning loads are highest. The remaining 25 MW will be earmarked for combined heat and power (CHP), also known as cogeneration. This is the simultaneous production of electricity and heat from a single fuel source.
Big increases in storage incentives
The proposed incentives are not yet approved, but illustrate a considerable effort to increase pressure on New Yorkers to lower energy usage during peak demand periods. Reliability is of greatest concern during peak demand hours since at this time reserve capacity is at its lowest. To address the reliability concerns, the incentive for thermal energy storage will increase from the current offering of $600/kW to $2,600/kW and from $600/kW to $2,100/kW for battery storage. There are increased incentives for programs that enable Demand Response, improved chiller/HVAC/BMS/controls, lighting, fuel switching and CHP. Not to mention a bonus incentive of an additional 10-15 percent of the base incentive will be given to large projects that create a load reduction of 500 kW or more.