Connecticut’s General Assembly is considering legislation to deploy 1,000 MW of energy storage by 2030, allowing for competitive procurements that would include stand-alone energy storage projects or projects paired with renewable energy resources like wind and solar.
The bill, which passed the Senate and now faces scrutiny in the House, works off the Department of Energy and Environmental Protection’s (DEEP) 2021 IRP, marking the state’s first assessment of pathways to achieve a 100 percent zero-carbon electric supply by 2040. As part of meeting this target, the plan calls for launching battery storage procurements beginning in 2027.
That is too late, says Francis Pullaro, Executive Director of RENEW Northeast, whose board-level membership includes global energy giants like Avangrid Renewables, NextEra, Equinor, and EDPR.
Pullaro believes the bill should accelerate the deployment deadline to 2025 from 2030 and require that all storage resources be competitively sourced.
“I think what we have to work on once the bill becomes law is to make sure that the Agency actually wants to do a storage procurement–and do it soon,” Pullaro told NPM. “There’s discussion in the Agency’s draft IRP that it didn’t see the need for storage until later in the decade, which we think is incorrect and certainly flies in the face of everything that we see from the benefits of storage. I think one of those benefits is just how much the cost of energy storage has fallen.”
Cost reductions for new and emerging utility-scale storage technologies have been significant, dropping 70 percent between 2015 and 2018, according to a recent EIA analysis.
“We didn’t push for this aggressive of a goal last year, but once we saw an auction that ISO-New England ran in February–that 600 MW of storage cleared the auction and the low auction clearing price–we realized that storage has arrived,” Pullaro said. “It provides a lot of reliability benefits, flexibility, and it can do so in a very cost-effective way. I think that was the motivation of the bill in the Legislature.”
DEEP has solicited bids for energy storage resources paired with renewables as part of several recent grid-scale competitive procurements. But with current modeling calling for more than 1,000 MW of new energy storage capacity by 2040, it begs the question as to why the state would wait nearly a decade to launch a solicitation.
“The Department can run a procurement soon and see the value coming out of it,” Pullaro said. “They can see ratepayers are benefiting, the environment is benefiting, and say, ‘let’s accelerate this.’ We have seen it with renewable energy procurements where legislatures will come back every year or every other year to up the procurement requirement, in part just to keep up with some of the other states. They see in every RFP and auction that is held that prices just keep falling. The case for doing it– and doing more of it–just makes more and more sense. I think we’ll see that with storage.”
Ousting fossil fuels
Connecticut has historically served as an attractive location for the development of New England’s fossil fuel-powered generation facilities. Coastal and inland waterways, along with rail networks, have provided convenient delivery points for those fuels to power generation sites along the shoreline and adjacent to navigable rivers.
In addition, hundreds of miles of high-voltage transmission lines across the state have made it possible for Connecticut-generated power to reach load centers within Connecticut, Massachusetts and Rhode Island. Three interstate natural gas pipelines traverse the state, supporting all the region’s natural gas-fired generation, while a cap on carbon emissions from Massachusetts power plants have also contributed to making Connecticut a lower-cost location for operating new and existing fossil-fuel plants.
This has resulted in Connecticut playing host to 60 percent of the fossil fuel plants needed to meet New England’s peak demands–despite consuming only 24 percent of the region’s electricity.
“Connecticut is still host to a lot of inefficient fossil generation,” Pullaro said. “It doesn’t run a lot, but when it does it is pretty dirty. It is not just carbon emissions–it is actual old-school dirty. These are oil and less efficient gas units that would benefit from being pushed out of the market and replaced with storage. Getting rid of old generators that are in communities that have suffered under them for many decades is an idea that is becoming more accepted in state legislatures as part of these broader climate bills that we are seeing. I think we’re trying to harness that receptivity to not just carbon and jobs, but we’re trying to get rid of these obsolete resources from some of the cities in Connecticut.”
While Pullaro acknowledges that storage procurements alone cannot guarantee the ouster of older, dirtier energy resources, he says it could go a long way in conjunction with other measures.
“We need to find a way to push those resources out, and then also make sure that we have the right resources in place when they do retire,” he said. “I think that’s what the objective is here. We do have a pretty bad disconnect between state policy and how our wholesale capacity markets are run. It’s unfortunate, but it’s all we can work with at the moment.”
While the bill initially limited the pairing of energy storage to wind and solar resources, the legislation has now been expanded to include hydropower, thanks to advocacy efforts by RENEW.
“A Senate amendment was adopted to include hydropower and would allow a new storage resource to be paired or collocated with a small hydro resource, or it could be a virtual pairing,” Pullaro said. “The reason we had to insert the hydro language–if you looked at the bill before the amendment, it allows storage to pair with renewable resources that are in Class 1 of Connecticut’s RPS and that does not allow all forms of small hydro. We just wanted to make sure that small hydro is renewable.”
As an older resource, hydro faces plenty of challenges in competing with the lower prices offered by newer forms of energy. But the potential of hydropower should not be underestimated, says Pullaro.
“We see some of it as being very storage-like itself, and it would just seem to make sense to leverage an existing storage asset that is renewable,” he said. “They could use that site for development, which could be very efficient for ratepayers. And if the batteries are charging from that system, it could be good for the environment as well.”
But the win on hydropower is just the beginning. If and when the bill gets signed into law, RENEW will be at the ready to urge both the Governor and PURA to issue a competitive solicitation as early as this year.
“The Legislature providing this law should be a political encouragement to actually do it,” Pullaro said. “I know that Massachusetts has an energy storage procurement that should be announced soon. I don’t know if there are any benefits from two states coordinating on that, but there could be.”
Two energy storage dockets under consideration by PURA–one focused on small-scale commercial and residential storage, the other on grid-scale, non-wires alternatives–could also help spur deployment.
“Those two dockets are acknowledged in this legislation,” Pullaro said. “I think for my membership that’s doing the bigger projects, we’re certainly looking for additional opportunity in the non-wires alternative docket to get some more storage deployed that way. Once the legislation is adopted, we will probably see more work on that storage docket. I think the legislation kind of gives it a blessing to do a lot more for storage, so I think that is going to be very positive.”
Original article published by New Project Media.