First name:
Mimi
Last name:
Reichenbach
Class Year:
2016
Advisor:
Daniel Esty
Essay Abstract:
Energy storage is an essential component of a future powered by intermittent renewable energy. As intermittent renewable energy generation increases in the United States, behind-themeter energy storage will become increasingly necessary. Behind-the-meter energy storage offers value to utility customers, while also providing utility grid stability. Thus, enabling energy storage is beneficial to both individual utility consumers and utilities themselves. Currently, behind-the-meter energy storage installation valuations are limited by low economic returns driven by i) large upfront financing expenses borne entirely by the project owner, ii) revenue generation problems from the perspective of the project owner. To increase the project owner economic benefit (valuation) and rate of adoption of behind-the-meter energy storage, i) installation costs must decline through technological improvements and increased access to lowcost financing, and ii) behind-the-meter energy storage services and revenue streams must be shared by multiple stakeholders (i.e. both utilities and customers). Financing can be made more accessible through federal investment tax credits, low interest rate loans from state green banks, and the involvement of utilities or third party financiers in energy storage installations. Revenue streams can be expanded through either third party or utility partnership with utility customers to share behind-the-meter energy storage revenue streams; this is most noticeably seen in a utility business model change to incorporate behind-the-meter assets with virtual power plants. This paper will discuss various pathways to increase the value and adoption of behind-the-meter energy storage to further enable intermittent renewable energy installations in the United States.