Tuesday, May 31, 2016

MISO Preparing a Place for Energy Storage in Tariff

By Amanda Durish Cook

CARMEL, Ind. — With one energy storage project under construction and several others being considered, MISO is beginning a look at rule changes needed to accommodate the emerging technology.

One fundamental question MISO will have to answer is whether storage will be considered generation or categorized as a transmission asset, MISO External Affairs Policy Advisor Jennifer Richardson said during a workshop at the Jan. 5 Market Subcommittee meeting.

“We’ve had kind of fits and starts with this issue … but as far as having a clear policy, well, that’s never happened,” Richardson said.

miso energyLast July, Indianapolis Power & Light began work on a 20-MW advanced battery, MISO’s first grid-scale storage array. The facility, located at the Harding Street Generation Station in Indianapolis, is expected to begin service in June. IPL’s parent, AES, has 116 MW of energy storage projects in operation and has 268 MW in construction or late-stage development globally.

MISO said it also has been approached by “several market participants who are considering battery storage options for the future.”

“I think what’s really noteworthy here is that there’s not a lot of precedent or cases here for MISO to determine whether this will be behind-the-meter or in-front-of-the-meter,” said Executive Director of Market Design Jeff Bladen, who added that the RTO wouldn’t encourage any method of energy storage over another.

MISO wrote short-term energy storage — such as batteries and flywheels, which can supply less than an hour of power — into its Tariff in 2009. Long-term resources such as pumped storage can provide energy, regulating and spinning reserves under the Tariff.

However, medium-term storage — battery and thermal storage that can provide hours of power — cannot serve as capacity, energy or contingency reserves under current rules.

“Medium-term storage is gaining a lot of interest,” said MISO Principal Advisor of Market Development and Analysis Yonghong Chen.

Chen said stakeholders need to discuss what sort of products MISO should provide. “Storage is a broad range of emerging technology … it can be complicated.”

MISO said CAISO, with 5,800 MW of storage in operation or development, is the most advanced region. ISO-NE, by contrast, has less than 1 MW of storage. PJM, which has about 200 MW of energy storage in operation, also has been considering rule changes. (See Treat Electric Storage Like Limited DR: PJM.)

“CAISO is certainly on one end of the spectrum and MISO may be somewhere in the middle. The issues that we’re looking for guidance on [are] really pretty vast,” Richardson said.

FERC also has been updating its rules to open ancillary services markets to more competition from storage. (See FERC Clarifies Energy Storage Rule.)

Josh Pack, manager of energy technologies at Vectren, said projects proposed by market participants can shape policy. “There are emerging business models and new market entrants helping to figure this out,” he said.

Wind on the Wires Executive Director Beth Soholt said policy should consider how independent power producers or utilities will be compensated. “It comes down to one question: ‘What do I get paid for?’” she said.

MISO is asking for a first round of written feedback on the issues raised in the workshop by Jan. 22.

Bladen said MISO plans to review the responses at the Feb. 2 MSC meeting. Tasks relating to policy formation may be delegated to either the MSC or Planning Advisory Committee, officials said.

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