ORIGINAL REPORTING: The Big Plan To Get Energy Storage Paid What It’s Worth

A silver bullet? Inside FERC's landmark energy storage rulemaking; Federal regulators are tackling ways to open wholesale markets to energy storage

Herman K. Trabish, Jan. 10, 2017 (Utility Dive)

Editor’s note: This federal proceeding is making slow steady progress as energy storage technologies get better and energy storage costs fall.

Energy storage is having an identity crisis in wholesale markets, and federal regulators are trying to fix it. The question is how to define energy storage. For system operators, storage can be generation, load or both. To solve the conundrum, the Federal Energy Regulatory Commission (FERC) opened a rulemaking for the nation’s six grid operators. Properly defined, energy storage can derive multiple value streams from grid operators’ markets. If markets are opened to it, energy storage can provide a litany of grid services and help alleviate concerns over the intermittency of renewable energy.

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FERC’s Notice of Proposed Rulemaking will amend its regulations to remove barriers to the participation of electric storage resources and distributed energy resource (DER) aggregations in capacity, energy, and ancillary service markets. The amendment is needed because wholesale electric markets were not designed to consider energy storage. The new tariffs must accomplish two things, according to the NOPR. First, they must establish market rules that recognize “the physical and operational characteristics of electric storage resources” and allow them to participate in the wholesale electricity markets. Second, they must define what a DER aggregator is as a wholesale electricity market participant and establish rules for each aggregator to participate… click here for more

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