Storage in California Golden Opportunity in the Golden State Scott Murtishaw, Consultant Electric Energy Storage North America San Francisco, CA July 10, 2018
Outline of Presentation • Overview of current policies and programs supporting storage in California • Indicators of recent market activity • Pending legislation that could affect the storage market • Key regulatory actions at the CPUC • Concluding thoughts on prospects for future growth 2
Current Programs Supporting Storage Self-Generation Incentive Program (SGIP) • Utility program, overseen by CPUC that has included storage since 2009 • Current incentive budget > $150 M per year • 80% reserved for storage • Funding authorization expires at the end of 2019 3
Current Programs Supporting Storage, cont’d Assembly Bill 2868 (2016) Assembly Bill 2514 (2010) • Requires the 3 large IOUs to • Required the CPUC to propose up to 500 MW of consider storage targets distributed storage • In response, CPUC • No more than 25% customer- established 1325 MW sited mandate for 3 large IOUs • CPUC invited IOUs to • Storage must be procured by propose additional storage 2020 and installed by 2024 using process implemented for AB 2514 4
Net Energy Metering and Rate Design Encourage Storage • CPUC’s 2016 “NEM PV Production (kW) vs TOU Rates 2.0” decision requires 3,5 $0,45 customers on NEM $0,40 3,0 $0,35 tariffs to take TOU rate 2,5 $0,30 • CPUC 2017 TOU 2,0 $0,25 $0,20 Guidance decision 1,5 $0,15 pushes peak periods 1,0 $0,10 back to 4 pm to 9 pm 0,5 $0,05 time frame 0,0 $- 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 AC output, kW TOU 2016 TOU 2018 5
SGIP Program Activity (MW) 250 200 150 Canceled Reserved/Pending 100 Paid/in Progress 50 0 2011 2012 2013 2014 2015 2016 2017 2018 6
SGIP Activity by Steps Source https://www.selfgenca.com/home/program_metrics/ 7
Utility Procurement Activity Utility Amount, MW Status PG&E 70 Approved PG&E 165 Pending SCE > 300 Approved SCE 135 Pending SDG&E 40 Approved SDG&E >180 Pending 8
Pending Legislation – SB 700 (Wiener) • Would extend collection of behind-the-meter storage incentives (via SGIP) for an additional five years. • $120 million per year x 5 years = $600 million • Funds would be collected through Dec. 31, 2024, expended through Dec. 31, 2025. • Depending on incentive structure, could incentivize 2000 – 3000 MW of storage • SB 700 passed the Assembly Utilities & Energy committee on June 20 th with a bi-partisan 14-1 vote. Bill has three more steps before it reaches the governor’s desk to become law. 9
Pending Legislation – SB 1347 (Stern) • Senate Bill 1347 as introduced, would require all “load - serving entities” (investor -owned utilities, CCAs, ESPs) to procure their proportionate share of 2000 MW of storage • Allows IOUs to own up to 50% of the share allocated to them • Does not specify if in front of or behind-the-meter • Passed Senate in May • Assembly U&E committee unanimously passed modified version, which would authorize but not require up to 2000 MW, on June 27 10
Other Programs Driving Future Demand • CPUC is establishing a framework for IOUs to procure DERs to provide local services • avoided transmission or distribution capacity • voltage support • Several solicitations for pilot procurements have been issued • Focus to date on competitive solicitations but a recent ruling reaffirms CPUC’s interest in streamlined mechanisms • Various IOU solicitations for local generation capacity • SCE’s West LA Basin and Moorpark solicitations • PG&E’s Oakland Clean Energy Initiative 11
Concluding Thoughts • Numerous bills and CPUC decisions demonstrate strong support for both utility-scale and behind-the-meter energy storage • Broad mandates and incentives have driven most storage adoption to date and will likely continue for near-term • Increasingly, the CPUC is looking to more targeted procurement for generation capacity (local, flexible) and distribution-level services to drive the market 12
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