What is Driving Energy Storage Deployment?

Western Power Summit – Las Vegas Cedric Christensen, Director of Market Development November 5, 2014

Unparalleled experience in PV and energy storage

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California Energy Storage Alliance (CESA)

» Founded in January, 2009

» 85 member companies

» Active in over 20 regulatory proceedings at CPUC, CAISO, and CEC

Strategen Consulting

» Started consulting in PV and energy storage space in 2005

» Unique focus in strategic advisory work in the clean energy industry

Energy Storage North America (ESNA)

» Largest storage conference in the world

» 28 countries in attendance

» Regulators, utilities, large strategic accounts, and start-ups

Energy Storage Is A Very Broad Asset Class

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Electro-Chemical Storage

(Flow battery / Lithium Ion )

Mechanical Storage

(Flywheel)

Bulk Mechanical Storage

(Compressed Air)

Thermal Storage

(Ice / Molten Salt)

Bulk Gravitational Storage

(Pumped Hydro)

Transportation

(Electric Vehicles)

Broad Electric Power System Applicability

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Bulk Storage

Ancillary Services

Distributed Storage

Distributed Storage Commercial

Storage

Residential Storage

Courtesy of:

Global Operational Energy Storage

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Global Projected Energy Storage through 2020

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Operational Energy Storage (non-hydro)

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Planned Operational Energy Storage (non-hydro)

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Countries Leading ES Deployment (non-hydro)

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Regional Hubs for US Deployment

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Primary Use Cases (non-hydro)

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California Leadership: IOUs and MOUs

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1,325+ MW

350+ MW

Energy Storage Policy in California

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CP

UC

• Resource Adequacy

• Demand Response

• Storage Rulemaking

• Alternative Fuel Vehicles

• Interconnection

• Permanent Load Shifting

• Rate Design

• AB 327

• Integrated Demand Side Management

• Self Generation Incentive Program

• Interconnection

• Long Term Procurement Planning

• Renewable Portfolio Standard

CEC

• EPIC Program

• POU AB2514 Targets

CA

ISO

• Energy Storage Roadmap

• Flexible Resource Adequacy

• Transmission Planning Process

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AB 2514 – 1,325 MW procured by 2020

OTC and SONGS retirement – 6,209 MW of Retiring OTC Capacity by 2024

Long Term Procurement Planning – SCE (250 MW)

– SDG&E (25 – 200 MW)

CAISO Reforms to Wholesale Market – Market design updates specific to storage

– Storage being considered in transmission planning process

– Updates to interconnection process

Self Generation Incentive Program – - $83M/year through 2020

Net Energy Metering / Rate Design

Factors Advancing Energy Storage in CA

Assigned Commissioner’s Ruling: 1.325 GW Goal!

Use case category, by utility 2014 2016 2018 2020 Total

Southern California Edison

Transmission 50 65 85 110 310

Distribution 30 40 50 65 185

Customer 10 15 25 35 85

Subtotal SCE 90 120 160 210 580

Pacific Gas & Electric

Transmission 50 65 85 110 310

Distribution 30 40 50 65 185

Customer 10 15 25 35 85

Subtotal PG&E 90 120 160 210 580

San Diego Gas & Electric

Transmission 10 15 22 33 80

Distribution 7 10 15 23 55

Customer 3 5 8 14 30

Subtotal SDG&E 20 30 45 70 165

Total – all 3 Utilities 200 270 365 490 1,325

© 2014 California Energy Storage Alliance

California’s “Duck Curve”

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March 2014

Source: CAISO 2014 Flex Capacity Needs Assessment

Renewable Output in California

March 2014

Source: CAISO 2014 Flex Capacity Needs Assessment

Renewable Effect on California Net Load

Forecast Load Growth from Electric Vehicles in California

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Source: Vehicle - Grid Integration: A Vision for Zero-Emission Transportation Interconnected throughout California’s Electricity System; California Public Utility Commission, March 2014. R.13-11-007. Pg. 3.

Energy Storage: ~3X the Flexible Range per MW

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Compare benefits, not megawatts

100MW LMS 100

Gas Peaker Plant1

100MW Energy Storage System

30MW Min. Output

(when no emissions

constraints)

100MW Max. Output

70 MW Range 100MW Discharge

-100MW Charge

200MW Range

1. LMS Plant Picture Source: http://www.industcards.com/cc-usa-ca-n.htm (Panoche Power Plant, Firebaugh, CA)

Energy Storage: 3X the Utilization

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100 MW LMS 100

Gas Peaker Plant1

100MW Energy Storage System

>95% Utilization Utilization

20%-40%

0% 50% 100%

Startup Time

Shutdown Time

Min Utilization

Max Utilization

Unutilized 0% 50% 100%

Startup Time

Shutdown Time

Min Utilization

Max Utilization

Unutilized

1. LMS Plant Picture Source: http://www.industcards.com/cc-usa-ca-n.htm (Panoche Power Plant, Firebaugh, CA)

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Energy Storage System

Full Power Ramp

<1 second

Graph Source: Kirby, B. “Ancillary Services: Technical and Commercial Insights.” Wartsilla, July, 2007. pg. 13 1. http://www.cpvsentinel.com/about.html

LMS 100 Gas Peaker Plant

Full Power Ramp

10 Minutes

Energy Storage Responds More Quickly

Storage Is Now Part of Long Term Procurement Planning

LTPP decision requires minimum of 50MW (SCE) for local capacity requirements

SCE LCR Track 1 Decision 2/12/13, SCE Track 4 Decision 2/11/14

SCE Procurement Authorization and Requirements (Track 1 and Track 4)

261.1 MW » West LA Basin

» Moorpark

More Information

Thank you!

Cedric Christensen Director of Market Development

– Email: cchristensen@strategen.com – Office: +1 510 665 7811 x 105