Energy Storage Technology Advancement Partnership
(ESTAP) Webinar:
State of the U.S. Energy Storage
Industry: 2015 Year in Review
April 19, 2016
Hosted by Todd Olinsky-Paul
ESTAP Project Director
Clean Energy States Alliance
State & FederalEnergy Storage Technology Advancement Partnership
(ESTAP)
Todd Olinsky-Paul
Project Director
Clean Energy States Alliance (CESA)
Thank You:
Dr. Imre GyukU.S. Department of Energy,
Office of Electricity Delivery andEnergy Reliability
Dan BorneoSandia National Laboratories
ESTAP is a project of CESA
ESTAP Key Activities:
1. Disseminate information to stakeholders
2. Facilitate public/private partnerships to support joint federal/state energy storage demonstration project deployment
3. Support state energy storage efforts with technical, policy and program assistance
Clean Energy States Alliance (CESA) is a non-profit organization providing a forum for states to work together to implement effective clean energy policies & programs:
• ESTAP listserv >3,000 members
• Webinars, conferences, informationupdates, surveys.
Massachusetts: $40 Million
Resilient Power/Microgrids Solicitation; $10 Million energy
storage demonstration
program
Kodiak Island Wind/Hydro/
Battery & Cordova
Hydro/flywheel projects
Northeastern States Post-
Sandy Critical Infrastructure
Resiliency Project
New Jersey: $10 million, 4-
year energy storage
solicitation
Pennsylvania Battery
Demonstration Project
Connecticut: $45 Million,
3-year Microgrids Initiative
Maryland Game Changer Awards: Solar/EV/Battery
& Resiliency Through Microgrids Task Force
ESTAP Project Locations
Oregon: Energy
Storage RFP
New Mexico: Energy
Storage Task Force
Vermont: 4 MW energy storage
microgrid & Airport
Microgrid
New York $40 Million MicrogridsInitiative
Hawaii: 6MW storage on
Molokai Island and
2MW storage in Honolulu
State & Federal Energy Storage Technology Advancement Partnership (ESTAP) is conducted under contract with Sandia National Laboratories, with funding from US DOE.
• Ravi Manghani, Senior Analyst, Energy Storage, GTM Research
• Brett Simon, Analyst, Energy Storage, GTM Research
Today’s Guest Speakers
April 19, 2016
Senior Energy Storage Analyst and Energy Storage Analyst
[email protected] and [email protected]
Ravi Manghani and Brett Simon
State of the U.S. Energy Storage Industry:2015 Year in Review
1GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
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GTM Research is the market analysis and consulting arm of Greentech Media. GTM Research is comprised of analysts covering solar,
grid edge, and energy storage markets. Our analysts combine diverse backgrounds in energy, environmental, emerging technology,
information technology and strategic consulting sectors. This diverse team provides critical and timely market analysis in the form of
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2GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Contents
1. Deployment Trends 3
2. Market Drivers and Business Models 7
3. Vendor Activities 18
4. Outlook 23
4GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
A Record Year for U.S. Energy Storage Market With 221 MW of Deployments
Front of the Meter Behind the Meter Total
0
50
100
150
200
U.S
. An
nu
al E
ner
gy S
tora
ge
Dep
loym
ents
(M
W)
2012 2013 2014 2015
0
5
10
15
20
25
30
35
40
2012 2013 2014 2015
221
0
50
100
150
200
250
2012 2013 2014 2015
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review
5GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
PJM (Excl. NJ)
All Others
Hawaii
California
All Others
New York
PJM (Excl. NJ), California and Hawaii Led Utility, Non-Residential, and Residential Segments in 2015
Utility Non-Residential Residential
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review. *GTM Research is currently monitoring seven individual markets. Complete coverage of all markets is available in the full report.
Hawaii
All Others
California
6GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review. Other includes flywheel and unreported energy storage technologies
Lithium-Ion Technologies Made Up 96% of 2015 Deployments (MW)
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015
Ener
gy S
tora
ge D
eplo
ymen
ts b
y Te
chn
olo
gy (
MW
)
Lithium Ion Lead Acid Sodium Chemistries Flow - Vanadium Flow - Zinc Other
GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Market Drivers and Business Models
Five Biggest Themes of 2015 and Beyond
2.
8GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Five Key Storage Market Drivers in 2015
#1 System Cost Reductions Continue at Rapid Pace
#2 Wholesale Markets’ Structures Develop to Include Storage
#3 Strong Renewables Growth Bolsters Storage Growth
#5 Storage Emerges As a Viable Technology for Grid Services
#4 Storage Mandates and All-Source RFOs Become a Commonplace
9GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Hardware
Hardwareinverterinverter
containerization
containerization
SCADA/controller
SCADA/controller
Soft Costs
Soft Costs
project origination
project origination
overhead
overhead
interconnection
interconnection
EPC EPC
EPC EPC
2015 2015 2020E 2020E
Sto
rage
BO
S C
ost
($
/kW
)1) 41% Storage BOS Costs Reduction by 2020; Reach Below $400/kW
Source: GTM ‘Grid-Scale Energy Storage Balance of Systems 2015-2020: Architectures, Costs and Players’
Storage BOS Costs to Reach $398/kW by 2020Hardware Costs Reduce by 48%Soft Costs Reduce by 31%EPC Costs Reduce by 31%
10GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
1) Front-of-Meter System Prices Expected to Drop 20% over Next Two Years
Utility-Scale Price Trends Q4 2015, Energy Applications – 2 Hours ($/kWh) Utility-Scale Price Trends Q4 2015, Power Applications ($/kW)
$700
$500
$900
$700
$1,200
$1,000
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
Utility (Energy Application,$/kWh) - Q4 2015
Utility (Energy Application,$/kWh) - 2017E
Q4
20
15
Sys
tem
Pri
ce R
ange
s (
$/k
Wh
)
$800
$650
$1,000
$800
$1,200
$1,000
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
Utility (Power Application,$/kW) - Q4 2015
Utility (Power Application,$/kW) - 2017E
Q4
20
15
Sys
tem
Pri
ce R
ange
s (
$/k
W)
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review
11GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
2) Wholesale Markets’ Structures Evolving to Include Storage
CAISO reduced performance threshold for frequency regulation
PJM reduced RegD cap of 40% from the previous cap of 62%. A Senior Task Force created to re-evaluate application of marginal benefit function to regulation market.
MISO created a platform to address storage-related market rules and questions, ranging from development of a fast AGC signal to tariffs and storage classification.
SPP implemented pay-for-performance compensation for frequency regulationISO-NE introduced energy-neutral regulation signal and different parameter sets to track conventional and energy-neutral dispatched resources
FERC issued order relating to third-party provision of primary frequency response.
ERCOT established the DREAM Task Force to determine protocols and market rules for distributed energy resources
Jan ‘15 Mar ‘15 Aug ‘15 Oct ‘15 Nov ‘15 Jan ‘16
CAISOapproved DERP framework
Jul ‘15 Feb ‘16
CAISO Board of Governors approved changes to the non-generator resource model under ESDER.
Source: GTM Research/ESA U.S. Energy Storage Monitor
12GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
3) Solar-Plus-Storage Benefits Vary in Duration and Frequency
Discharge Duration
Freq
uen
cy o
f U
se
DR RevenuesDG Electricity
Sales
Renewables Smoothing
Ancillary Services
Resiliency
Power Quality
Fuel Costs
Peak Demand Charges
Time-of-Use Shifting
Occ
asio
nal
Freq
uen
tR
are
LongMediumShortCustomer-site application
Front-of-meter application
Both sides of meter
Source: GTM Research
13GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
3) Tax Credit Extension to Spur Further Growth in Storage Paired With Renewables
U.S. Storage Deployment Paired With Renewables Differential Vs. No Extension
-50
0
50
100
150
200
2016E 2017E 2018E 2019E 2020E
An
nu
al S
tora
ge D
eplo
ymen
ts
Pair
ed W
ith
Ren
ewab
les
Dif
fere
nti
al (
MW
)
Residential Non-Residential Utility-Scale
Compared to the non-ITC scenario, GTM Research expects an additional 0.5 GW of storage paired with renewables from 2016-2020, a 33%increase compared to a scenario with no tax credit extension.
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review
14GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
4) Progress by California IOUs for 2014 Energy Storage Procurements Under AB 2514
Utility 2014 Proposed Target Actual Procurements Timeline
50 MW transmission24 MW distribution
7 projects totaling 75MW selected inDecember 2015
First projects expected tobe on-line by May 2017
16.3 MW distribution(Plus Local CapacityRequirementprocurement)
2 projects totaling 16.3MW selected inSeptember 2015
Projects can start as earlyas January 1, 2017; mustbe interconnected byDecember 1, 2024
10 MW transmission, 6MW distribution (PlusLocal CapacityRequirementprocurement)
12 MW solicited throughLCR RFO. 4 MW soughtthrough distributiondeferral RFP, but electednot to procure anystorage through the RFP.
Project can be on-line asearly as 2017,interconnection requiredby January 1, 2022
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review
310 361
80
177171
54
82
236
2725
568
767*
186*
0
100
200
300
400
500
600
700
800
900
1,000
PG&E SCE SDG&E
Tota
l CA
IOU
s P
rocu
rem
ent
Distribution Customer
Unknown Total
15GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
4) Other Notable Utility Procurements from New York to Guam!
New York
PSEG Long Island amended its South ForkResources RFP and issued a NewRenewable Capacity and Energy RFP. ConEdison and Orange and Rockland issued aGrid-Scale Energy Storage RFI.
Texas
Austin Energy issued an RFI to solicitinformation on energy storagetechnology.
Oregon
Oregon DOE and U.S. DOE awarded$295,000 under Electrical Energy StorageDemonstration Project RFP.
Arizona
APS issued an all-source RFP to procurebetween 400 MW and 600 MW of capacityresources by 2020. TEP selected two 10 MWstorage projects under REST
Colorado
PSC Colorado/Xcel Energy submitted twostorage project proposals under theInnovative Clean Technologies program.
Guam
Guam Power Authority is soliciting bids forup to 40 MW of energy storage.
Hawaii
KIUC entered in a 20-year PPA with SolarCityfor power from a 13 MW/52 MWh lithium-ion storage system
Source: GTM Research/ESA U.S. Energy Storage Monitor
Federal
U.S. DOE announced funding underGrid Modernization Initiative,including $18 million for six SHINESprojects.
16GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
5) Significant Early Activity in Behind-The-Meter Storage for Grid Services
Deployed/ Program Ended
Underway
IRM2 Pilot
SSP and XSP Pilots
LCR Program
EV and Storage Pilot
Energy Excelerator/Stem Pilot;
Oahu EV Charging PilotFrito-Lay FRRS Pilot
Demand Management Program;
Virtual Power Plant REV project
Maryland Energy Administration
‘Game Changer’ Grant
PJM Projects
PJM Projects
PJM Projects
CPUC DRAM
Tesla Powerwall
Innovate Pilot
Glasgow Electric Plant
Board VPP Project
Source: GTM Research/ESA U.S. Energy Storage Monitor
17GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Option 1 Option 2 Option 3
$6,501/customer Total = $488K
5) Green Mountain Power to Use Behind-the-Meter Storage to Reduce Peak Capacity and Transmission Costs
Forward Capacity Market (75%)Transmission Costs (50%)Total benefit = $81K per year
75 225 200
Total Grid Services Benefits = $205K per year
$6,501/customer Total = $488K
Forward Capacity Market (75%)Transmission Costs (50%)Total benefit = $124K per year
Rate rider = $37.5/month/customerTotal = $91K per year
Bill credit = $31.8/month/customerTotal = $81K per year
Source: Green Mountain Power, GTM Research
System Sale/LeaseCash TransactionGrid Service
GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Vendor Activities
Corporate Financing, Products, and Partnerships
3.
19GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
$212
$449
$160 $158
$554
$365
$5
$172
22
27
22
30
39
32
0
10
20
30
40
$0
$200
$400
$600
$800
2010 2011 2012 2013 2014 2015
Deal C
ou
nt
Dis
clo
sed
Val
ue
(Mill
ion
s U
SD)
VC Project Financing Deal Count
Corporate Investments in Energy Storage Totaled $365 Million in 2015
Note: Data excludes battery materials and upstream companies. 2014 data differs from U.S. Energy Storage Monitor 2014 Year in Review due to exclusion of EV startup Atieva and inclusion of stealth startup Fluidic Energy.
Source: GTM Research
20GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Significant Amount of New Partnership, Product and Business Model Announcements
Source: GTM Research/ESA U.S. Energy Storage Monitor
21GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Significant Amount of New Partnership, Product and Business Model Announcements (cont.)
Source: GTM Research/ESA U.S. Energy Storage Monitor
22GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
Significant Amount of New Partnership, Product and Business Model Announcements (cont.)
Source: GTM Research/ESA U.S. Energy Storage Monitor
24GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
U.S. Annual Energy Storage Deployments Will Cross 1 GW in 2019, Reach 1.7 GW by 2020
83 46 65
221
1,662
-
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E
U.S
. En
ergy
Sto
rage
Dep
loym
ents
by
Segm
ent
(MW
)
Utility Non-Residential Residential
Annual Deployments Cross 1 GW Mark in 2019
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review
25GTM Research "State of the U.S. Energy Storage Industry: 2015 Year in Review"
$432
$2,456
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E
U.S
. An
nu
al E
ner
gy S
tora
ge M
arke
t Si
ze
(Mill
ion
$)
Utility Non-Residential Residential
U.S. Energy Storage Market to Reach $2.5 Billion by 2020, Sixfold Growth From 2015
Annual U.S. Energy Storage Market to Reach $1 Billion in 2018
Source: GTM Research/ESA U.S. Energy Storage Monitor 2015 Year in Review
Interested in other GTM Research products and services? Please visit www.gtmresearch.com or contact [email protected]
Thank you!
April 19, 2016
CESA Project Director:
Todd Olinsky-Paul
Webinar Archive: www.cesa.org/webinars
ESTAP Website: bit.ly/CESA-ESTAP
ESTAP Listserv: bit.ly/EnergyStorageList
Sandia Project Director:
Dan Borneo
Contact Info
Upcoming ESTAP Webinars
• Procurement Guidance for Energy Storage
Projects: Help with RFIs, RFQs and RFPs, April 20,
2-3:30pm ET
• Energy Storage Market Updates and Focus on
Modeling for System Design, April 21, 12-1pm ET
More information at www.cesa.org/webinars