California’s Grid Operator Looks at How to Absorb Excess Solar Energy with Storage

A first-of-a-kind load shedding proposal from California’s grid operator aims to absorb excess solar energy with storage to help solve some challenging economic and environmental problems.

The California Independent System Operator (CAISO) is now developing the idea, which would allow more solar energy to make it to the grid in the middle of a sun-filled day, thanks to the use of energy storage that would capture excess solar energy during peak production and release it when the sun isn’t shining.

In a briefing about the proposal to CAISO’s Board of Governors, John Goodin, CAISO’s manager, infrastructure and regulatory policy market and infrastructure policy, explained the challenge. Right now, solar is wasted because it can’t all be absorbed by the grid, he said.

“A load shift product means excess clean energy can be absorbed and stored and used productively at a different time to the benefit of the economy and the environment,” he said in his presentation.

The new product would help save the extra solar energy produced in California, via behind-the-meter energy storage devices, said Steven Greenlee, senior public information officer for CAISO. It would help reduce the need to curtail solar production during times of oversupply and address the negative prices that occur during oversupply, he said. The proposal, which is in its “nascent stages,” will be part of the “Energy Storage and Distributed Energy Resources Initiative, or ESDER, he said.

The California Energy Storage Alliance believes the product will not only help customers know when to charge their customer-sited energy storage systems to help grid economics; it will also help them know when to capture excess solar energy and support the decarbonization of the grid, said Jin Noh, policy manager for CAISO, which is participating in the discussion.

“This is a first-of-its-kind development where California and the CAISO are approaching grid challenges very thoughtfully using new tools like customer-sited energy storage,” he said.

California is expected to see more energy storage come to the grid because the state boosted its incentives for customer-sited energy storage recently, doubling the Self-Generation Incentive Program in April, and giving energy storage 85 percent of the funds. Of that amount, projects larger than 10 kW get 90 percent of the funding, and 10 percent of the funding goes to residential projects that are less than or equal to 10 kW.

The energy storage is expected to help when there is  too much solar that results in negative prices during the day. Storage providers could potentially get paid, under the product, to charge in the mid-day, through a wholesale bid, explained Noh. In essence, owners of storage get cheaper charging rates to offset expensive peak time rates, he said.

Proposal not a slam dunk

The proposal is not a slam-dunk; a number of challenges must be addressed, said Greenlee.

CAISO must ensure that the load-serving entity — or utility — and the storage provider are separate, he said. In addition, CAISO must address the fact that the amount certain resources can be dispatched during a day or time period is capped in some instances.

In addition, CAISO doesn’t want the load shifting product to jeorpardize the ability of a behind-the-meter storage device to continue offering demand reductions that can qualify as resource adequacy, he said. What’s more, storage devices need to be able to seamlessly move between charge and discharge states.

The load shifting product will give behind-the-meter storage the ability to increase load in times of excess capacity, “but we need to ensure that energy will not be allowed to be transferred back into the ISO grid by the resources even if it has the capability to do so,” Greenlee said.

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And multiple-use applications must be addressed to see how they can best be compensated, he said. This issue is now being examined by the California Public Utilities Commission.

“Multiple use means a resource provides services and receives compensation from multiple entities, which may include the end-use customer, utility, and/or the ISO,” explained Greenlee.

No more throwing away clean energy

Ted Ko, policy director for Stem, which is participating in the CAISO proceedings, said, “As behind-the-meter storage is proving to be a growing, successful resource in the CAISO markets, the CAISO is recognizing that these resources should be brought in to help shift over generation (the ‘belly’ of the duck) to the ramp (‘neck’) or peak (‘head’) periods.” Once the product is launched, Stem will work to use help reduce the practice of “throwing away” clean, renewable energy, he said.

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