On the heels of Florida regulators allowing residential solar leases, utilities should start to deploy intelligent residential storage as a grid asset.
With the third-highest solar potential in the country, combined with the state’s Public Service Commission’s recent unanimous vote to allow residential solar leases, the Sunshine State could experience a rapid proliferation of residential solar.
The penetration of distributed solar, which lacks control and predictability, may disrupt Florida’s legacy generational structure. Florida can learn from the top residential solar markets, such as California, New York, Massachusetts and Hawaii, to couple solar with intelligent energy storage systems. In doing so, utilities will be able to proactively manage residential solar generation, improving its availability and predictability while also ensuring a controlled and reliable dispatch at any time.
JEA, the municipal utility in Jacksonville, Florida, is leading the way in the state’s residential energy storage landscape with the introduction of a rebate program and an updated net metering structure. Steven McInall, director of electric production resource planning, said that this will “encourage residential storage applications” to control behind-the-meter solar generation to “minimize residential consumption during grid summer peaks.”
Residential intelligent energy storage systems go beyond consumer-specific benefits such as bill management, solar self-consumption, and backup power/resiliency to offer grid-scale services. When aggregated within a virtual power plant, these systems can be orchestrated as a utility asset to provide grid services such as peak shaving and shifting, frequency and voltage regulation, and demand response. This flexibility allows these systems to co-optimize value above and below the meter by reacting in seconds to grid and local load conditions.
Earlier this year, Utility Dive highlighted Florida’s $230 million investment potential and the current focus on utility-owned large-scale systems installed higher up on the grid’s network. However, from a grid-planning perspective, utility-owned energy storage systems located downstream at the residential level, which accounts for 47 percent of the state’s electricity consumption, offer significant benefits over grid-scale systems. These include intelligent behind-the-meter controls, backup power, feeder-level resiliency, and increased visibility at the grid edge.
Intelligent behind-the-meter control
Florida utilities can leverage residential intelligent energy storage systems to offset the timing imbalance between solar generation and peak demand that has stimulated California’s duck curve.
Despite being a different regulatory and ownership structure than Florida, but with similar reliance on natural gas, the California day-ahead wholesale market energy prices during the evening peak period have risen by over 70 percent between 2016 and 2017. These price increases are indicative of the cost to operate the greening grid. Residential intelligent energy storage systems can provide the management link to control local renewable generation and optimize system operations to reduce the steep ramping requirements necessary to supply Florida residents with power when they return home.
Additionally, customers benefit from these battery operations through the arbitrage of Florida utilities’ opt-in time-of-use tariff design or reduction in residential demand charges during the evening peak period. According to Lakeland Electric, a customer on its residential demand tariff can expect to save $1,152 annually with the installation of a residential intelligent energy storage system.
This use case supports a strong platform to initiate the adoption of residential intelligent energy storage systems; however, the true value of these systems is realized by stacking services to address multiple grid and consumer needs. Within Florida Power & Light territory, the additional stacked services may include frequency regulation and spinning contingency. These market mechanisms are not currently open for energy storage participation, but if these systems are leveraged by the utility, they can be operated to offer additional value of around $120 per kilowatt-year.
Reliability and resiliency
Florida utilities and the state legislature are looking to adopt storage technologies to improve grid reliability and resiliency. The installation of a residential energy storage systems can increase these crucial grid attributes. By working in front of and behind the meter, these systems offer the added benefit of a quick response resource needed to assist in feeder-level resilience, while also providing backup services to customers for their critical household loads.
According to Vicki Nichols, director of customer solutions and market development at JEA, with the increase in weather severity, “backup power is a top feature that customers are looking for,” In 2017, Hurricane Irma struck Florida, cutting out power to 6.7 million electricity customers — 64 percent of all customer accounts in the state. Within the same year, a total of over 15 million people across Florida were affected by 79 power outages.
As a backup resource, intelligent residential storage immediately disconnects the site from the grid, during a power outage or minor grid disruption, to supply critical power to the residential customer.
Real-time visibility and forecasting
Residential intelligent energy storage gives utilities real-time grid edge visibility to plan, forecast and react to the evolving distributed grid structure.
These systems can collect and display granular, near-real-time grid data that includes power flow, voltage, current and phase angle, as well as consumption-side usage data that incorporates charge/discharge, PV production and other distributed energy resources information. This granularity is imperative to provide an active, high-resolution and high-frequency view of exactly what is occurring at the grid edge — an operational necessity that today’s smart meters lack — to allow Florida utilities to make real-time plans for future generational needs.
As Florida’s energy landscape evolves with the further adoption of solar, residential intelligent energy storage can provide significant benefits through behind-the-meter control. In addition, these systems offer backup service during grid outages from severe weather events and increased visibility and forecasting measures at the grid edge.
JEA’s incentive and Lakeland’s residential solar-plus-storage pilot highlight the fact that Florida utilities are starting to appreciate the benefits these systems offer as a grid asset. However, the true value will only be realized when consumer and grid services are stacked and deployed at the utility scale.