Embed Size (px)
Citation preview
Tim Derrick, General Manager, Advanced Solu7ons April 27, 2015 World Energy Storage Forum Rome, Italy
Energy Storage + Renewables: Case Studies from US Markets
P. 2 | SunEdison
§ SunEdison Overview § Case Studies from US Energy Storage Markets
1. Solar + Frequency Regulation (New Jersey) 2. Solar + Demand Charge Reduction (California) 3. Wind + Ramp Rate Control (Hawaii)
§ Terraform: Storage Financing
Topics
P. 3 | SunEdison
Introduction § SunEdison: Renewable Energy Developer and Operator § Terraform Power: YieldCo, 1.5 GW of Solar and Wind Assets
P. 4 | SunEdison
North American Energy Storage Opportunities
CALIFORNIA Application: DCR, BTM Capacity, DR Incentive: SGIP $1.60/W Market Size: AB2514 (1.3GW) 2013-2020 outlook: $3.1B
PJM Application: Frequency Regulation Market Size: >1400 MW
NEW YORK: Application: DCR Incentive: $2.1/W 2013-2020 outlook: $300M
PUERTO RICO: Application: Ramp Control
viable now
Potential near term
ONTARIO Application: Grid-scale storage Market Size: 50 MW 2013-2020 outlook: $100M
HAWAII Application: Ramp Control Market Size: > 200MW
TEXAS / ERCOT: Application: Frequency Regulation 5 GW Announcement ? 2013-2020 outlook: $300M
1Bloomberg New Energy Finance Energy Storage Forecast 2013 - 2020
Case study #1
Case study #2
Case study #3
P. 5 | SunEdison
Case Study 1: DG Solar + Storage in PJM*
Cost Synergy
Revenue Streams
Natural Hedge
RE Grid Integration
To the Customer
• Demand Reduction • Renewable Energy • Backup Power
To the Grid • Frequency Regulation
Value Streams:
*PJM is the Independent System Operator (ISO) in Pennsylvania, New Jersey, Maryland, et al.
Benefits:
P. 6 | SunEdison
§ Cost Savings: − Common Inverter − Common Interconnection − Project Development − Installation − Permitting − Energy Curtailment
§ Revenue Streams: − Backup/Islanding: Solar +Storage − Grid Services (Freq Regulation) − Tax Incentives (Federal ITC 30%)
Solar Capex Solar Capex
Solar Opex Solar Opex
Storage Capex Storage Capex
Storage Opex Storage Opex
Solar PPA Solar PPA
Solar SREC Solar SREC
Solar ITC Solar ITC
Storage DCR Storage DCR
Storage FR Storage FR
Storage Backup Storage Backup Extended Backup
Storage ITC
-‐
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
Cost Rev Cost Rev
Solar + Storage Economics in PJM ($ NPV)
Combined Assets Individual Assets
Case Study 1: DG Solar + Storage in PJM
Key Market Drivers: Hurricane Sandy (2013) and FERC Order 755
P. 7 | SunEdison
Case Study 2: DG Solar + Storage in California
Demand vs Consumption charge over time
• Demand charges have risen significantly for commercial customers 2008 to 2013
• As more renewables are added, demand charges are expected to continue to rise
Load shaving fat the customer site:
Off Peak + EECC 100kW Shaved x $20.77/kW
On peak + EECC 100kW Shaved x $21.10/kW
Off peak (all day)
On peak (11am – 6pm)
-‐200.0 -‐150.0 -‐100.0 -‐50.0 0.0 50.0 100.0 150.0 200.0 250.0
0:00 2:00 4:00 6:00 8:00 10:00 12:00 14:00 16:00 18:00 20:00 22:00
25kW
105kW
Original peak load
Post storage peak
P. 8 | SunEdison
Case Study 2: DG Solar + Storage in California
12am 3am 6am 9am 12pm 3pm 6pm 9pm 12am
Original Load Load with Solar
12am 3am 6am 9am 12pm 3pm 6pm 9pm 12am
Load aAer Solar Load Solar + Storage
85 kW max
139 kW max
Original Load Load with Solar
Load with Solar Load with Solar + Storage
§ Total energy consumed (area under curve) is less on a post solar load curve
§ Total peak demand is reduced § Higher value capture for developer § Greater savings for customer
Customer saves on kWh of energy
Customer saves on kWh + kW of demand
Load
(kW
) Lo
ad (k
W)
P. 9 | SunEdison
Case Study 2: DG Solar + Storage in California
Original Customer Bill
Solar Only Savings
Storage Savings
Storage Value Capture
Solar Value Capture
Customer value
39%
61%
5%
54%
11%
48%
9%
Developer Value Capture 19% addi7onal value captured with storage
$18,000 per year
Storage Value
Energy charge Demand Charge SunEdison Value An
nual Dem
and and En
ergy Charge 13%
Solar savings
Storage savings
Solar value
P. 10 | SunEdison
Case Study 3: Wind + Storage in Hawaii
§ Kaheawa Pastures (KWP2) • 14 Wind turbines, 21 MW • Completed in July 2012 • Capacity Factor of ~50% • Represents ~10% of 200MW peak
capacity on Maui • Ramp Rate limits
±2.0 MW/min from 4:00 am to Midnight ± 1.0 MW/min from Midnight to 4:00 am.
10MW/20MWh Energy Storage
§ Battery Storage Facility • 10 MW/20 MWh • Limits ramp-rate in wind output • Mitigates curtailment • Multiple values to the grid operator:
Up/Down Reserves, Frequency Regulation, Frequency Response
P. 11 | SunEdison
Case Study 3: Wind + Storage in Hawaii
§ 72 MW of wind projects on 200MW Maui grid • Without storage, 16.5% of total wind generation will be curtailed* • By adding a 10MW / 70MWh storage and reducing must-run generation,
total curtailment will drop be 7.1%**
§ KWP2 is curtailed before other Maui wind projects • available energy 90 GWh • curtailed energy 46 GWh • delivered energy 45 GWh • net capacity factor 24%
§ Economies of Learning: by improving the grid operation procedures, the wind curtailment has been significantly reduced in 2014 and 2015
*Maui Energy Storage Study, SAND2012-10314 **Hawaiian Electric Companies' 2013 IRP Report and Action Plan
Island of Maui Hawaii, USA
P. 12 | SunEdison
Case Study 3: Wind + Storage in Hawaii
§ Multiple grid services provided by storage at KWP2
*AGC = Automated Generation Control, signal sent by ISO/utility to adjust output
P. 13 | SunEdison
Terraform: SunEdison YieldCo
§ Publicly traded company which owns operating assets that produce predictable cash flow
§ Lower cost of capital driven by low risk cash flows from operating solar and wind assets
§ Dividends paid to shareholders and SunEdison § Current dividend yield ~3% § Terraform will include energy storage assets in portfolio § 3rd Party ownership with lower cost of capital will
significantly reduce cost of energy storage
P. 14 | SunEdison
Challenges to Financing Energy Storage
Technology
Policy
Business Model
Market
• Lack of consistent warranties, degradation curves, capacity maintenance protocol
• Limited track record for various technologies/chemistries • Safety concerns
• Lack of clarity on US tax rules as pertain to Storage • Changing tariff structures in utility markets • Unclear guidelines on ancillary services revenue streams in
most electricity markets
• Customer-sited and grid-tied projects have different models • Uncertainty on value streams captured • Uncontracted cash flows
• Dependence on merchant power markets • Market clearing price for FR varies significantly ($/MWh) • e.g. PJM: 2012 (48.31) à 2013 (34.93) à Jun 2014 (67.57)
