Page 30 - ESJ – ENERGY STORAGE JOURNAL

COVER STORY: US STATES TO WATCH

compressed air, which can be stored for lat-
Goldberger: er use, says Jason Burwen, the vice president
of policy at the ESA.
Long term, the Carl Mansfield, head of NantEnergy’s
key for these commercial & industrial energy storage
systems will business applauded the proposed bill (see
box out). He believes it’s an important rec-
be regulatory ognition of the critical role energy storage
and market plays in modernizing the electric grid and
the tax credits would support diversity in
reforms that the storage market.
Meanwhile, US Senators Amy Klobuchar
create additional (district of Minnesota) and Jerry Moran
opportunities to (representative of Kansas) introduced bi-
provide services partisan legislation to give clean energy and
microgrids a boost in April.
and secure The Expanding Access to Sustainable
revenue streams. Energy act aims to assist rural communi-
ties and rural electricity cooperatives to
overcome the barriers to renewable energy
storage and grid improvements by provid-
ing them access to relevant resources and
expertise.
Economics of deployment
Politicians can do their bit by introducing
policy and legislation, but the factor deter-
mining if storage is deployed across all 50
Solar+storage states is economics, especially in terms of
It’s clear the combination of solar with stor- lifecycle. The variables of that are the up
age is the next step in developing a reliable front costs, and throughput — in its life-
and clean electrical grid, and policy will time how many megawatts can the user put
have its part to play in enabling opportu- through it.
nities to deploy batteries beyond the few Wood Mackenzie forecasts battery rack
markets where energy storage is currently prices will drop below $150/kWh over the
economic. next five years. So that’s one element. But
US representative Mike Doyle introduced what about throughput?
a key policy on April 4. The updated version Babinec says it’s the most important fac-
of the Energy Storage Tax Incentive and tor. “While a person may buy an EV they
Deployment Act — first introduced by US like for emotional reasons or status, this is a
senators Cory Gardner and Martin Hein- grid. It’s a commodity, period. It’s economi-
rich in 2016 — aims to extend to batteries cally dominated and the economics of that
and other energy storage systems the same are really about the life-cycle cost.”
30% investment tax credit offered to solar When it comes to managing throughput
PV systems. As it stands only a small subset there is not just one variable, and the com-
of energy storage projects co-located with plexity of the question can be handled by
solar are eligible. mining data and testing.
If ratified, the bill will establish a federal “When we come into this brave new world
investment tax credit for business, residen- we are entering we have to think in terms
tial, and utility-scale projects using batteries of life cycle throughput, which is called the
and other energy storage technologies. levelized cost of storage. Cycle life is a com-
Importantly, the legislation seeks to es- mon metric people use, but in fact it is only
tablish the tax credits for both commer- one part of the better metric of total energy
cial and residential energy storage through throughput,” says Babinec.
2021. The incentive would then be phased “Its all about throughput versus capital
down annually — 26% in 2020, and 22% and the way you optimise the use of a bat-
in 2021 — before levelling off after that to tery. There are general guidelines for how
a standard, permanent 10% tax credit for you cycle a battery, but those are only rules
commercial projects and zero for residential of thumb.
projects. “If you are going to build a giant plant
The energy storage industry believes the and you are going to put in 20MW of stor-
new investment tax credit should cover not age you want to know, in detail, exactly
just batteries but also other storage technol- how you optimise that asset. You are going
ogies—such as pumped hydropower, more to need to do very detailed calculations and
efficient flywheels, and technology that con- measurements and that’s what Argonne is
verts electrical energy into high-pressure working on.”

28 • Energy Storage Journal • Summer 2019 www.energystoragejournal.com