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Energy News Network: Federal Policy Could Unlock New Value From Rooftop Solar and Home Batteries

Posted by David Thill on Oct 10, 2019

Energy News Network highlighted AEE's DER Report and included quotes by AEE's Jeff Dennis. Read excerpts below and the entire Energy News Network piece here. 

Rooftop solar panels and home battery systems could play a significant role in balancing the nation’s electric grid, but federal regulators need to adopt policies to help make that happen, according to a clean energy group’s recent report.

So-called distributed energy resources — customer-managed generation and storage systems spread across the grid — are often too small to participate in the regional wholesale markets where utilities buy most of the electricity they sell to customers...

Industry stakeholders say regulators can set a clear path for resources like solar panels and batteries to be grouped together by organizations known as “aggregators.” Grouped together, they could compete with larger generators and earn revenue so developers can lower prices for customers, accelerating the adoption of clean energy on the grid, according to the authors of the new report from Advanced Energy Economy.

The report describes how policy guidance from the Federal Energy Regulatory Commission, which oversees the wholesale markets, could open the door for more participation of aggregated distributed energy resources in the markets. Right now, customer-managed storage, and storage paired with generation like solar, are the resources developers seem most interested in aggregating for wholesale participation, said Jeff Dennis, managing director and general counsel at Advanced Energy Economy.

But “what we have found is that wholesale markets often contain barriers” to distributed energy resource participation “that are either explicit or implicit,” he said. “And most often they’re implicit.” Participation isn’t necessarily prohibited, but it’s often limited to demand response. It’s not clear under current policy how aggregated distributed resources “can provide services that they’re capable of providing,” Dennis said...

In early 2019, California-based developer Sunrun bid 20 megawatts of residential solar-plus-storage assets across four states in the ISO New England forward capacity market. These resources are set to be online in 2022. According to Sunrun and Advanced Energy Economy, this is the first time a solar-plus-storage developer has successfully cleared a forward capacity auction, which incentivizes resource development to ensure the grid can meet electricity demand in the future...

The Advanced Energy Economy report notes that technically, Stem’s resources could participate in other California markets. But unlike the state’s demand response program, that participation would require resources to be on call all the time, meaning they couldn’t participate in outside revenue-gaining programs. Additionally, the rules require customer-managed storage assets participating in the markets to pay twice for the energy they use to charge: once at the retail price and once at the wholesale price. This makes demand response more appealing and financially viable, the report says...

Read the entire Energy News Network piece here.

Topics: AEE In The News