Key Considerations for Utility-Scale Energy Storage
The renewable energy industry continues to view energy storage as the superhero that will save it from its greatest problem—intermittent energy
Grid Charging: “Grid charging” refers to the charging of the energy storage system from energy on the power grid (as opposed to a paired energy generation resource, such as wind or solar).
Some PPAs for new energy storage resources have been structured as capacity-only contracts in which the developer is responsible for the sale of energy and all costs associated therewith—including the costs of the required energy procured from the utility.
For standalone energy storage contracts, these are typically structured with a fixed monthly capacity payment plus some variable cost per megawatt hour (MWh) of throughput. For a combined renewables-plus-storage project, it may be structured with an energy-only price in lieu of a fixed monthly capacity payment.
The procurement target was set at 1,325 megawatts (MW) to be divided amongst Pacific Gas and Electric Company (PG&E), Southern California Edison (SCE), and San Diego Gas and Electric (SDG&E). This procurement target was set for implementation by 2020, with installations no later than the end of 2024.
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