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Utility Dive: Tesla, others question storage hourly requirements, charges in Order 841 compliance plans

Posted by Iulia Gheorghiu on Feb 13, 2019

Utility Dive summarizes comments filed about grid operators' plans to implement FERC's energy storage rule (Order 841). The article references comments from AEE on PJM Interconnection's plans. See excerpts below and the entire Utility Dive story here:

As energy storage becomes more economically competitive with more traditional forms of merchant generation, access to wholesale power markets is seen as an important addition to the technology's opportunities on the contracted side. However, questions remain about the effective implementation of the federal order that seeks to create consistent opportunities for storage to compete in wholesale energy markets.

The Federal Energy Regulatory Commission (FERC) is working through conflicting stakeholder comments regarding the compliance plans filed last year by six regional transmission operators (RTOs) and independent system operators (ISOs) related to Order 841 — FERC's directive on integrating energy storage into wholesale energy markets.

While the proceeding is in its later stages and grid operators are less than a year away from their deadlines to comply with the storage order, disagreements among stakeholders remain. Certain groups, including the National Association of Regulatory Utility Commissioners (NARUC) and the National Rural Electric Cooperative Association (NRECA), have asked FERC for a rehearing on the order. NARUC said that FERC did not have the authority to direct RTOs and ISOs to whether they should include storage in the wholesale market. NRECA and a number of smaller utilities objected to the lack of regional control in the grid operators' plans...

...Many intervenors, from ESA to Advanced Energy Economy (AEE), opposed the proposal to determine storage capacity value by a resource's ability to meet a 10-hour continuous duration requirement. By relying on characteristics typical for non-storage resources, PJM "will exclude significant capacity" from storage resources, "resulting in unjust and unreasonable rates," AEE wrote.

The proposal does not address how storage resources can calculate opportunity costs in cost-based offers, which "could result in PJM inappropriately mitigating that resource to a cost-based offer that is below its true short-run marginal cost," AEE wrote.

See the complete Utility Dive story here.

Topics: AEE In The News