Solar + Storage
Innovative Solutions for America's Energy Needs
Storage is playing a revolutionary role in the further advancement of solar. States with higher storage penetrations will lead an unmistakable trend in the solar industry.
- Solar + storage has, and will continue to have, a symbiotic relationship. Ultimately, the wide-scale adoption of solar will lead to the wide-scale adoption of storage, which will in turn lead to more opportunities to deploy solar.
- While storage can be used in many applications, the success of the storage technology is intimately tied to solar because of its potential for meteoric growth in the solar sector.
- To reach our goal of solar accounting for 20% of electricity generation by 2030, storage will play an increasing role in providing power when the sun is not shining.
- SEIA is the voice of solar + storage.
- Membership in SEIA by storage technology providers and their supply chain partners is a must have in gaining access to the solar market and in leading solar + storage policy priorities.
Why Solar + Storage?
Solar and storage create business opportunities for each other. As solar penetration increases, states and solar companies are turning to storage. Energy storage can smooth electricity prices through arbitrage, manage evening energy ramps, mitigate the risk of curtailment, provide black start capability, provide backup power and more.
The cost of lithium ion batteries (the most common type of storage paired with solar) has fallen rapidly as manufacturing has scaled up to support both electric grid applications and electric vehicles. For distributed projects, storage can address issues, help customers manage the move toward time-of-use (TOU) pricing and later TOU periods, and give system owners access to the power from their solar panels for more hours of the day.
NREL’s analysis suggests that increasing solar penetration in California creates a market for 7,000 MWh of 4-hour storage. Texas and New England are beginning to experience the same kinds of conditions that create these opportunities. GTM reports that storage can compete for as much as 82% of projected new combustion turbine capacity projected over the next decade.
Increased storage deployment can reduce grid management concerns such as the so-called “duck curve,” creating additional opportunities for solar deployment. While there are many strategies for approaching the integration of solar at the levels of penetration seen in states like Hawaii and California (increased flexibility of other generators, demand response, etc.), storage puts the power to facilitate integration directly into the hands of solar developers.
Many solar companies view storage as a business growth opportunity. While there is certainly plenty of room for growth of stand-alone solar in most states, the long-term success of the solar industry and its ability to scale beyond about 20% of total electricity generation depends on the cost-effective integration of storage.1
Solar & Energy Storage Markets
Groundbreaking solar + storage projects, like Kauaʻi Island Utility Cooperative (KIUC)'s projects with Tesla (operational in 2017) and AES Distributed Energy, the Tucson Electric Power contract awarded to NextEra and the bids for Xcel’s all source procurement, demonstrate firm solar power affordability. Every week we see more solar + storage announcements.
For example, Arizona Public Service (APS) will add a 50-megawatt (MW) battery system paired with a new 65 MW solar plant to its fleet. The regulated utility signed a 15-year power purchase agreement (PPA) with First Solar, and the plant should be up-and-running in 2021. Florida Power & Light recently announced that it had installed a solar + storage system that integrates battery technology with an existing utility-scale solar power plant (built in 2016). In January 2018, an Xcel Energy solicitation in Colorado set a new solar + storage record after attracting a median price of $36 per megawatt-hour.
According to market research firm IHS, the global energy storage market is growing exponentially to an annual installation size of 6 gigawatts (GW) in 2017 and over 40 GW by 2022 — from an initial base of only 0.34 GW installed in 2012 and 2013.
SEIA strongly supports the creation of an Investment Tax Credit (ITC) for energy storage. SEIA is lobbying aggressively to ensure legislation that extends the ITC to energy storage technologies moves through Congress.
SEIA is providing top level communications and lobbying for storage. We are educating members of Congress and the administration, as well as the general public, about how solar + storage can transform the energy landscape.
Other Advocacy Actions
- Providing input on product standards and building codes for storage;
- Creating a storage addendum for SEIA’s standard solar contracts;
- Coordinating with the Energy Storage Association on priorities relevant to solar;
- Tracking and analyzing EIA and other data for large-scale storage projects;
- Working to remove barriers to adoption for distributed and utility-scale storage at the state level; and
- Adding storage to consumer protection materials for distributed and utility-scale storage at the state level.
Steps SEIA Has Taken in the States:
- California: modeled and created a proposed solar + storage rate design for the PG&E rate case; successfully supported the inclusion of storage compliance credit for the requirement for solar on new homes in California.
- Nevada: developed extensive testimony in a rate case focused on creating residential and small commercial TOU tariffs to support energy storage.
- Colorado: Submitted testimony supporting the expansion of RESA (Renewable Energy Standard Adjustment) funds to solar + storage projects; supported the newly enacted distributed energy storage bill establishing customer rights and preventing utilities from imposing additional metering.
- Michigan: submitted extensive testimony opposing DTE’s construction of a new natural gas plant, arguing that a better solution would be a mix of distributed generation, battery storage, energy efficiency, and demand response.
- Florida: sponsored solar + storage pilot program legislation.
- Virginia: intervened in Dominion IRP to educate the Commission on the economics of solar + storage.
Policy Drivers Needed for Further Growth
- Continued federal lobbying to unleash the ITC for storage
- Additional public private investment to make storage affordable and applicable across a broader range of projects
- Making sure that solar + storage is a central component in federal projects
- Establishing Integrated Resource Plans that incorporate solar + storage as cost-effective alternatives to fossil fuel power plants
- Ensure storage is represented in grid modernization efforts
- Continuing to promote and establish effective, costed-out, solar + storage rate design
- Facilitating siting of co-located solar + storage projects
How to Engage in SEIA’s Solar + Storage Work Through Membership Committees
- Codes & Standards Working Group
- Federal Policy Committee
- State Policy Committee
- Individual State & Regional Committees (Texas, California, Southeast, Northeast, Midwest, Intermountain West)
- Public Relations Committee