Energy Storage

For Eos, a battery storage developer, Brattle consultants assessed the value of the company’s technology in the California market. We estimated the multiple values of storage in providing wholesale market services (energy, regulation, and spinning reserves) and deferring generation, transmission, and distribution capacity investments.  We developed an optimal operational strategy to capture the multiple value streams to increase the overall “stacked value,” accounting for realistic factors such as imperfect foresight of wholesale electricity market conditions and prices.  The Brattle project team identified potential enhancements to retail rate and wholesale market design to facilitate storage development and maximize societal value.

For Oncor, Brattle experts evaluated the economics of grid integrated distributed electricity storage in Texas.  Our analysis found that distribution-level storage could provide substantial net benefits to the state, and up to 5,000 MW of grid-integrated, distributed electricity storage would be cost effective from an ERCOT system-wide perspective.  In addition, total customer benefits would significantly exceed costs.  We found that enabling cost-effective investments in electricity storage will require modification to the existing regulatory framework to allow investors capture both the wholesale market, T&D system, and customer outage avoidance values associated with distribution-level storage devices.

For a potential investor in battery storage technology, Brattle experts analyzed PJM’s real-time market participation rules for storage.  We developed a real-time energy and ancillary service bidding strategy that the asset owner could employ to nearly optimize storage operations, given expectations for prices and battery operations and constraints looking forward several hours. Our analysis estimates the net revenues that storage devices of various efficiencies and durations could earn by employing optimal bidding strategies.  We also identified changes in PJM’s real-time bid/offer rules that PJM would have to implement to fully enable optimal battery utilization from a system-wide perspective.  Finally, we estimated the revenues that storage devices of different configurations could earn in PJM’s capacity market, assessed the risk of performance penalties, and identified capacity market design modification that would be necessary to access the capacity value of storage resources.

For the National Rural Electric Cooperative Association, Natural Resources Defense Council, and Peak Load Management Alliance, Brattle experts evaluated the economic benefits of controllable electric hot water heaters and heat pump water heaters in participating in the wholesale power markets.  We evaluated a range of water heater control strategies, including peak shave, energy arbitrage, and fast-response to provide frequency regulation.  Our analysis quantified the system benefits, potential revenues, and carbon emission effects in PJM and MISO under both existing and projected future market conditions.

Brattle experts analyzed options to integrate renewable (wind, solar, and biogas) resources to provide 50% of the island’s electricity needs. The study included development of different ancillary service requirements, detailed operational simulations accounting for renewables and load forecast uncertainty and variability, generator maintenance and forced outages, economic cost, and benefit evaluations of renewable+storage integration. Several storage technologies were analyzed to improve renewable integration, including various capacity, energy density, different charging and discharging options, installation options, and ownership models. Brattle experts are currently analyzing options to avoid fuel-oil use for all energy and water production.

Brattle supported an investment fund’s due diligence effort for evaluate possible investments in distributed, behind-the-meter storage devices. We analyzed the overall value proposition, cash flows, business risks, and operating characteristics of two alternative business models involving bilateral contracts with commercial retail customers and the local distribution utility with simultaneous participation in the wholesale markets for energy, ancillary services, demand response, and local resource adequacy.

In late 2017, Brattle conducted an assessment of market opportunities for a multi-national company that is considering entering the North American energy storage market.  The study involved a review of market conditions, rules, and policies for the three storage market segments (wholesale, T&D, and retail) and 15 geographic regions in North America. For each region, Brattle developed a detailed presentation of the regional markets, its players, ongoing and expected policy changes and impacts, incentives, and various other storage related topics. We then summarized 22 important metrics (as defined with the client) such as market size, price levels and volatility, retail rate structure and policies (i.e., net metering), and storage market penetration levels and value estimates. Based on these metrics, Brattle further helped develop short- and long-term strategies.