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'Bottle Sunlight' is Rallying Cry of Cali's Energy Storage Campaign
Green Technology Featured Articles
August 13, 2013

'Bottle Sunlight' is Rallying Cry of Cali's Energy Storage Campaign

By Cheryl Kaften
TMCnet Contributor

California, the state that leads the nation in solar energy incubation and installation, is now looking to put some aside “for a rainy day.”

As Governor Jerry Brown remarked at the Intersolar North America meeting in San Francisco early in July, to an audience of over 17,000 industry players, "We can’t just rely on sunlight. We’ve got to bottle [it]."

He means business. By 2020, he intends to reach California’s proposed energy storage capacity of up to 1.3 gigawatts (GW)—soon to be established by the California Public Utilities Commission (CPUC) under state measure AB 2514. That would be enough to power more than one million homes, no matter what the weather or the condition of the power grid, with utilities covering many of the upfront costs.


Lux Research Analyst Steven Minnihan told Reuters (News - Alert) this week that California's proposal is the first legislation that will have an immediate and lasting impact on the grid storage market, which he estimates will soar to installations worth $10.4 billion in 2017 from just $200 million last year.

Understandably, the state’s three biggest utilities—Pacific Gas and Electric, Southern California Edison (News - Alert) and San Diego Gas & Electric—are opposed to setting energy storage targets. And so is the Division of Ratepayer Advocates within the CPUC.

"The ratepayers would be on the hook," said Farzad Ghazzagh, who is analyzing the proposal for the Division of Ratepayer Advocates, an arm of the California Public Utilities Commission. His analysis is not complete, but Ghazzagh revealed to Reuters that he had seen estimates of $1 billion to $3 billion to install so much storage.

Proponents argue that ratepayers will benefit because storage enables utilities to avoid building power plants or transmission systems to meet peak demand, simply by providing extra power for a few hours a day.

The Electric Power Research Institute conducted a report for California's Public Utility Commission this summer that found, overall, storage is worth the cost, if all benefits are considered. EPRI used a new software tool to run through 30 scenarios identified by the CPUC staff and other stakeholders that included storage applications, technologies, product configurations, market conditions, and grid locations. Under the assumptions provided by the CPUC, the majority of cases returned benefit-to-cost ratios of greater than one, and the majority of cases returned breakeven capital cost of energy storage ranging from $1,000/kW to $4,000/kW installed.

The true impact of California's initiative will be felt between 2020 and 2030, Lux's Minnihan said, and he expects the move to inspire efforts by other states.

The CPUC anticipates releasing its final order in October of this year.




Edited by Alisen Downey


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