If you read The CAISO Dilemma – you’re aware that one of the challenges facing California is that intermittent renewable generation is often unavailable during times of peak demand – primarily, in the evenings on particularly hot days. Energy storage systems – specifically batteries – are one of the proposed solutions to this challenge in California and to the intermittent generation problem in general. According to a report by the Energy Information Administration (EIA), energy storage costs declined 72% between 2015 and 2019.
Interested in learning more about intermittent generation and other generators? Check out our blog on Electricity Generation Basics.
As storage costs decrease, large-scale batteries are becoming more prevalent. The number of large-scale battery storage systems operating in the US increased 28% in 2019, and the trend is set to continue according to the EIA’s report.
As these storage systems begin to operate throughout the US, the big question is how they will affect the markets. If batteries are able to successfully serve load during times of peak demand, will they ultimately cause prices and volatility to decrease? How will these systems impact how thermal units and peaking plants operate? How will these first movers operate to maximize their return on investment (ROI)?
These will all be important questions for power market participants, asset owners, and operators to investigate and begin to answer as they build their strategies going forward. According to Utility Dive CAISO’s storage sector manager, Gabe Murtaugh, as CAISO ramps up to thousands of megawatts of storage, it will impact the market, and we will begin to see differences in how the market operates (Balaraman 2021). With the EIA reporting that the combined capacity of US battery storage projects might grow more than 10 times the 2019 figure between 2021 and 2023, contributing an additional 10,000 megawatts, it's clear that batteries are here to stay and entering nodal markets rapidly.
Batteries are sure to influence how the grid operates. CAISO is already seeing evidence of storage resources’ ability to behave as predicted and shift energy production to the times of the day when it is needed most (Balaraman 2021). As this occurs, it will be imperative that market participants, asset operators, and asset developers get ahead of the curve and the competition. Participants who investigate and educate themselves on the likely impacts that increased storage capacity will have on the grid will be best positioned to succeed and thrive in the markets.
Organizations can begin to do this by using datasets and tools that expose exactly how storage assets are currently operating on a day-to-day basis. Pairing this data with comprehensive nodal market data allows you to develop a full picture of how batteries are affecting the markets as a whole.
Yes Energy’s newest solution, Transaction View, paired with Yes Energy’s extensive ISO nodal market data solutions, allows businesses to do exactly this. Transaction View utilizes data from the Federal Energy Regulatory Committee’s (FERC’s) Electric Quarterly Reports (EQR) across US power markets and allows for easy and accurate analysis of more wholesale electricity market data than ever before.
This data is particularly important as the power industry evolves, and participants need to develop flexible and agile strategies. Transaction View delivers transparency to electricity market transactions and, alongside Yes Energy’s existing data solutions, it gives you all of the data and information you need to make educated and informed decisions in these rapidly evolving markets with the capability to power your business. Receive a complimentary Transaction View consultation and demo.