Opening Marketplace to Storage
Andrew Kaplan is a partner with Pierce Atwood LLP. Kaplan served as general counsel and chief of staff to the Massachusetts Department of Public Utilities. He has a comprehensive understanding of federal and state rulemaking throughout the regulatory process.
Thomas Edison foreshadowed the potential for energy storage as "one of those peculiar things which appeal to the imagination and no more perfect thing could be desired," as early as 1883.
With FERC's February 2018 decision requiring RTOs/ISOs to establish rules that allow energy storage resources to provide wholesale market services, Edison's vision is about to be realized.
Until now, participation by energy storage resources, including batteries and flywheels, has been limited to frequency regulation. In 2007, FERC opened the ancillary services markets to non-generators: energy storage technologies were technologically advanced enough to participate in the wholesale energy markets.
At that time, the best operational fit for those fifteen-minute energy-neutral resources was the frequency regulation market.
Frequency regulation requires immediate changes in power. Energy storage resources proved a suitable fit, given that they are designed to remove from or restore electricity to the grid within four seconds of being dispatched.
For many years, the industry worked closely with FERC and the ISO/RTOs to ensure that energy storage resources were allowed to participate in the frequency regulation market. They participated on par with traditional generators, and were paid for the value they provided to the grid.