FERC Determines That Battery Storage Devices Qualify as Transmission Facilities. Is the Door Open for Other Energy Storage Devices?
In late January, FERC issued an order in response to a filing by Western Grid Development LLC that asked FERC to declare that Western Grid's proposed battery storage devices are transmission facilities eligible for certain rate incentives. Western Grid described its battery technology as 10 to 50 MW sodium sulfur batteries that would be installed at strategic places on the California ISO transmission grid in order to provide voltage support and protect against transmission overloads. In a description that seemed significant to FERC, Western Grid stated that its batteries would only enhance transmission reliability at the California ISO's direction, and that the batteries would not operate or participate in energy markets or provide electricity for commercial sale.
FERC examines energy storage devices on a case-by-case basis because storage devices don't fit squarely within the traditional transmission, distribution, or generation categories of assets. In this case, FERC gravitated to the notion that the battery devices would not provide capacity or energy to be sold in the energy market, and that Western Grid would not retain any revenues outside of the transmission access charge (unlike generators). For these and other reasons, FERC distinguished Western Grid from similar filings (see Nevada Hydro II--pumped storage), and determined that Western Grid's technology will act enough like transmission assets to warrant eligibility for transmission rate incentives. FERC's approval of rate incentives, however, was conditional upon the California ISO approving Western Grid's projects in the transmission planning process.
Although FERC repeated numerous times that its decision was based on the "specific circumstances and characteristics" of Western Grid's projects, the order shows potential for energy storage devices. If such devices can show that they act sufficiently like traditional transmission assets (like capacitors), they may be able to obtain very valuable transmission rate incentives. Whether this opens the door for compressed air energy storage and pumped hydro (but see Nevada Hydro II) is still up in the air, but rest assured that these questions will be at FERC before too long.
Show me the Money: $343 Million Deployed to Transmission Project in Washington and Oregon
The Department of Energy has announced that $343 million from the American Recovery and Reinvestment Act has been provided to the Bonneville Power Administration's ("BPA") McNary-John Day transmission project (the "McNary-John Day Line") in Washington and Oregon.
The McNary-John Day Line runs 79 miles from the McNary Substation in Oregon, through Washington, and ending at the John Day Substation in Oregon. The BPA has stated that the new line will help promote wind and other renewable energy generation in the Pacific Northwest.
The McNary-John Day Line will be energized by 2012 and provide transmission service for over 575 megawatts of electricity.
2009 Utah Legislation Sets Stage for More Renewable Energy in Utah
Legislators recently adopted legislation aimed at helping Utah stay competitive with surrounding states in the fast growing national clean energy movement. Five (5) bills dealing with renewable energy and energy efficiency passed with strong bi-partisan support. Three (3) resolutions, while non-binding, send strong messages to local governments and utilities that the legislature encourages, and wants to remove barriers to, renewable energy and energy efficiency across all sectors. The success of the 2009 legislative session indicate that renewable energy will play critical roles in Utah’s future.
House Bill 430 - Economic Development Incentives for Alternative Energy Projects, is designed to attract new clean energy industries and projects to Utah. The bill allows the Governor’s Office of Economic Development (GOED) to establish energy development zones and offer tax credits to companies and projects located in those zones.
Senate Bill 76 SO3- Energy Amendments, address the barriers to renewable energy transmission by creating a political subdivision of the State tasked with the development of a master plan for renewable energy production and transmission infrastructure. This subdivision will have the ability to apply for and seek out federal grants, as well as bonding authority to pay for transmission lines for renewable energy.
Senate Joint Resolution 1 S02 Renewable Energy System, urges the Utah State Energy Program and municipal governments to collaborate on the development of model renewable energy ordinances to streamline the development process at the local government level.
Senate Joint Resolution 10 - Alternative Training Center, recognizes the need to train the growing clean energy workforce in Utah. The bill supports the establishment of an Alternative Energy Training Center in Beaver County, an area with high concentration of existing, upcoming and potential renewable energy development.
House Joint Resolution 9 - Effective Energy Efficiency and Utility Demand Side Management, recognizes energy efficiency as a priority resource and urges state and local governments and utilities to promote and encourage all available cost-effective energy efficiency and conservation, setting voluntary energy savings goals for Rocky Mountain Power and Questar Gas and expresses support for regulatory mechanisms that remove disincentives to utility energy efficiency and conservation.
