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Enabling EES Adoption:Recent Polic Chan es in

Electricity MarketsPresented by

Rahul Walawalkar Ph.D., CEM, CDSM

Vice President, Emerging Technologies & Markets

Customized Energy Solutions Ltd.

1528 Walnut Street, 22nd Floor

Philadelphia, PA 19103 USA

Phone: 215‐875‐9440

Fax: 215‐875‐9490

info@ces‐ltd.com

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OutlineOutline

Barriers for Energy Storage Commercialization

Overview of  Electricit   Markets in US

Summary of  recent market rule changes

FERC

NYISO

PJM

MISO

CAISO

Summary

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Barriers for adoptionBarriers for adoption

Inability to capture value for the multiple benefits

Energy arbitrage

Transmission optimization

Distribution upgrade deferral

Ancillary services

Power quality for end users

Regulatory uncertainty

Technology maturity

Cost reductionsPerformance  validation

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EES Technology InnovationsEES Technology Innovations

Innovations have resulted in significant

mprovemen s n es gn, er ormance apa es

Technology choice

Power & Energy rating

Life expectancy

Round Trip Efficiency

Response rate & any other operating considerations

Footprint & any special permitting requirements

Capability to meet requirements for different markets

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Role of Electricity MarketsRole of Electricity Markets

Provides price transparency to quantify value proposition

of various EES technolo ies

Market Design

Access to various markets for

Energy

Ancillary Services

Capacity

Financial Transmission Rights

Generation Supply mix & Demand Curve

Market sizeLocational factors

Electric transmission network & interconnection

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Electricity Markets in North AmericaElectricity Markets in North America

6Source: FERC: http://www.ferc.gov/industries/electric/indus‐act/rto/rto‐map.asp

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Comparison of ISOs/ RTOsComparison of ISOs/ RTOs

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Electricity Market FeaturesElectricity Market Features

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8Source: FERC

MISO Ancillary Service Markets started functioning in January 2009. CAISO completed implementation of MRTU on 31 st March 2009.PJM has switched from the systemwide capacity market to locational markets in 2007.

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Policy initiatives to integrate energy storage in gridPolicy initiatives to integrate energy storage in grid

NYISO has created a LimitedEnergy Storage Resource(LESR) category for allowingstorage participation inregulation market

MISO has created a StoredEnergy Resource (SER) categoryfor storage participation inregulation markets from 2010

FERC issuedOrder 890 in2007 to openregulationmarket fornon-gen

resources

CAISO has initiated astakeholder processto integrate nongenerationresources. FERCapprovedtransmissionincentives forstorage in Ca.

Source: FERC

In 2009, ERCOT added requirementsfor wind farms to provide regulationand voltage support

US Congress has proposed “Storage Technology of Renewable and Green Energy Act” of 2009 to provideinvestment tax credits for storage projects.

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ConclusionsConclusions

Over past 3 years, various system operators have 

worked to remove barriers for storage technologies to 

participate in various electricity markets

The price discovery mechanisms provided by these 

markets help in identifying right opportunities, 

locations and determine appropriate configurations

More initiatives will be introduced in coming year 

specially as various ISOs tackle the challenges related to 

renewable integration. e.g.

Non generation participation in ancillary services  – CAISO

Updates to frequency regulation market rules ‐ PJM

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Proposed Energy Storage Projects (DOE Smart Grid Demo)roposed Energy Storage Projects (DOE Smart Grid Demo)

Major projects include: CAES demonstration (NY and CA), Renewable Integration (CA, TX, NM),Peak Shaving, Community Energy Storage and demonstration of new technologies.

Visit www.energy.govfor additional details.

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AcknowledgementsAcknowledgements

Colleagues from Customized Energy Solutions 

Jacqueline DeRosa, Director ‐ Regulatory Affairs, CaISO

Rick Mancini, Director ‐ Regulatory Affairs, NYISO

Jeff  Whitehead, Director ‐ Regulatory Affairs, PJM

David Sapper, Director ‐ Regulatory Affairs, MISO

Eddie Kolodziej, Director ‐ Regulatory Affairs, ERCOT 

Nancy Chafetz, Director ‐ Regulatory Affairs, ISO‐NE

Jim Krajecki, Director ‐ Regulatory Affairs, SPP

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QUESTIONS ???UESTIONS ???

Dr. Rahul WalawalkarDr. Rahul Walawalkar215215‐‐875875‐‐94409440

rahul@cesrahul@ces‐‐ltd.comltd.com

www.ceswww.ces‐‐ltd.com ltd.com 

Customized Energy Solutions Ltd.

1528 Walnut Street, 22nd Floor

Philadelphia, PA 19103 USA

Phone: 215‐875‐9440

Fax: 215‐875‐9490

info@ces‐ltd.com