What utilities forget when they analyze storage (Hint: It has to do with benefits)

Tools

1

Rogers Weed has had a distinguished career, first at Microsoft and then as "energy czar" for the State of Washington. Today he is Vice President at an energy storage company where I sit on the advisory board. We got to talking recently about our industry's preoccupation with storage costs. And its failure to work equally hard on storage benefits. I asked him to pass along his insights in  a guest editorial, which you will find below.

 

Yes, it's important to reduce costs. But it's equally important to increase benefits. "Storage is actually close to economically sound today if you add up all the various benefit streams that can flow from it," according to John Estey, executive chairman of S&C Electric Co., as reported in EETimes.net – Jesse Berst

 

By Rogers Weed

 

Energy storage – Don’t forget the benefits

Analyzing cost-benefits of energy storage systems

 A lot of press lately has been devoted to the costs of different energy storage system technologies, as competitors race to out-innovate each other on this critical dimension. For instance, EOS generated coverage when it came out earlier this year and claimed it would eventually be able to deliver systems for as little as $160/kwh of DC power. And Tesla’s announcement of its Gigafactory plans generated another wave of forecasting and speculation.

1

Cost is crucial to the business case that will unlock massive investment in storage across the global utility industry, as well as behind the meter. And beyond technology innovation, open standards like the Modular Energy Storage Architecture (MESA) will reduce custom engineering and allow best-of-breed components to plug and play.

 1

But business cases are called cost-benefit analyses for a reason. We would all do well to remember that -- from a business case standpoint -- increasing the benefits that energy storage systems provide is as valuable as reducing costs.  Fortunately, we are collectively learning rapidly in this area. Pacific Northwest National Laboratory, EPRI and others are digging into the details of specific situations, and many are working on optimization models to point the way.

Filed Under