NECEC’s fourth Emerging Trends Series panel of 2017 last week brought together a panel of business leaders and policymakers who offered perspectives on one of the fastest growing markets in the clean energy sector: energy storage. Speakers, including Massachusetts Department of Energy Resources (DOER) Commissioner Judith Judson, Phil Giudice, President and CEO of AMBRI, Pierce Atwood Partner Andrew Kaplan and Doug Staker, Vice President of Business Development at Demand Energy Networks discussed Massachusetts’ new energy storage target, innovative storage technologies, and the federal regulatory prospects to support the storage market’s advancement.

Commissioner Judson kicked off with a keynote presentation on Massachusetts’ energy storage policy, focusing on DOER’s 200MWh aspirational storage target. While many of the panelists noted that they might have preferred “an extra zero on the end,” Judson drew from projections in the 2016 State of Charge Report to justify DOER’s target as an ambitious but achievable goal for energy storage. She also explained the numerous state initiatives underway to support the development of the energy storage market. Most significantly, DOER included storage as an adder for the new SMART solar regulations and in current DOER procurements, as they plan to investigate incorporating storage in the Alternative Portfolio Standard.

Andrew Kaplan, who brings a wealth of experience in state and federal energy regulatory work, provided national regulatory context with a discussion of current proceedings and future prospects at the Federal Energy Regulatory Commission (FERC). Kaplan acknowledged progress in the energy storage industry over the last decade. However, he expressed concerns for the future of federal storage regulations with four new commissioners at the helm of FERC.. Additionally, Kaplan mentioned the necessity of consistent regulations, highlighting the 2017 modifications to the PJM interconnection, which have strained storage technologies designed to comply with the initial 2012 program. Kaplan emphasized that this lack of market clarity and consistency is harmful to the successful introduction of energy storage technologies.

NECEC board member, and former DOER Commissioner Phil Giudice-- now President and CEO of Cambridge-based energy storage company, Ambri, outlined the conditions driving growth in the energy storage market. He noted that over the last seven years, the price per kilowatt hour of lithium-ion batteries has dropped from $1000 to around $250, with predictions that those costs will continue to fall by 19% per year. Much of this price trend can be attributed to technological innovations along with increased demand for batteries in electric vehicles and other electronics. While the demand for grid storage is currently negligible compared to other applications, it may become a far more pervasive source of demand as grid benefits are more fully realized.

Lastly, Doug Staker, Vice President of Business Development at Demand Energy Networks, offered a detailed discussion of the many grid benefits provided by energy storage. He described how storage can better manage demand response, and is often an efficient alternative to upgrading substations. Lastly, he touched upon the role storage plays in structuring a smart, reliable, and resilient electrical grid.

When asked about necessary tools for market development, business leaders Giudice and Staker both emphasized the need for market and regulatory certainty, especially when trying to secure project funding. They echoed Kaplan’s comments about FERC’s PJM interconnection regulations as a potential future impediment.

Commissioner Judson indicated that in order to advance regulations and provide revenue certainty for storage, DOER requires compelling evidence of project viability. She explained that it is important to see successfully completed projects, and implored businesses to engage in business model demonstrations and find opportunities to participate in current long-term procurements.

NECEC Executive Vice President Janet Gail Besser, who moderated the panel discussion, closed by noting the importance of driving energy storage for the benefit of our clean energy economy, making it evident that despite some challenges, storage is on an upward trajectory. Now is the time for companies to redouble their efforts to bring projects to market and actively engage as stakeholders to promote favorable regulation.

For more information, check out the presentation slides here.