Ott Testifies on Energy Storage to Senate Committee

2012

PJM President and CEO Andy Ott testified Tuesday (June 4) before the U.S. Senate Committee on Energy and Natural Resources in its hearing to examine opportunities for the expanded deployment of grid-scale energy storage.

PJM’s competitive markets have worked well to incentivize and incorporate various types of storage, Ott said, and batteries and other storage resources have a critical role to play for the future of a flexible grid. He noted that PJM’s early leadership and research have enabled the grid operator to become the largest market for battery technology today.

Ott’s prepared testimony is available on PJM.com.

The PJM markets embrace a host of energy storage technologies. They include 300 megawatts of batteries that provide frequency regulation, 5,000 MW of pumped storage hydro, and one of the nation’s largest battery deployments, co-located with a wind farm in Mount Laurel, West Virginia. Another 1,000 MW of stand-alone energy storage is in the interconnection queue, along with 2,000 MW of combined energy storage and renewables.

Energy storage resources on average supply 27 percent of the frequency regulation requirement, and during peak hours, that amount can rise as high as 49 percent, Ott said. Five years ago, traditional generation provided all frequency regulation;  “That’s a very big success story,” he said.

Storage Provides Valuable Service

Energy storage cannot replace traditional generation at this point, because battery duration is generally limited, Ott said. But “it has competed successfully to provide grid flexibility services and very high quality-added services on the grid,” he said.

PJM is fuel-neutral and treats batteries comparably to any other resource, Ott said. As with renewable resources, short-duration batteries are prorated based on their capability.

Ott also outlined several policy issues that impact the further incorporation of energy storage into the grid.

Among them is a filing before FERC to reform PJM’s reserve pricing, seeking to more fairly value resources that play a vital role in the reliability of the bulk power grid. This is an area that provides “tremendous revenue-stream potential for battery storage or other types of storage technology,” he said. “Storage does create a tremendous opportunity to use alternative technologies to displace traditional types of resources and clean up the grid.”