New ERCOT battery rule could limit energy storage use in grid emergencies, operators say
New state of charge rules “will substantially reduce energy storage participation in the ancillary markets and reduce competition,” Eolian CEO Aaron Zubaty said.
Dive Insight:
Energy demand is rising in Texas as the state attracts new businesses and residents, and struggles with extreme weather. Batteries are a key to keeping the grid operating reliably, and grid officials are crafting market rules to ensure they can operate effectively.
ERCOT’s decision is designed to allow the grid operator to “confidently evaluate the capability of these [energy storage resources] for the key hours in which the need for dispatchable generation is needed,” according to the proposal approved Thursday.
But some battery proponents say the new rules will discourage their development, even as storage is rapidly growing in ERCOT.
As of June there were approximately 3,300 MW of batteries on the ERCOT system, and according to the SOC proposal, that total is estimated to reach 9,500 MW by October 2024.
Battery developer Eolian opposed the new rule, which will require storage resources to maintain an SOC “that slopes linearly from the top of the Operating Hour to 0 MWh, which precludes flexible dispatch across all Ancillary Service products,” the company said in comments.
Eolian also said that batteries providing ERCOT’s Regulation Up and Regulation Down ancillary services — which increase or decrease generation output to maintain system frequency — will be required to have the maximum state of charge it bid for the Reg-Up product, “rather than operating at optimal flexibility with a lower SOC at the top of an Operating Hour, which would allow it to act as a sponge to immediately charge and discharge as needed to maintain the stability of the grid.”
“Unintended consequences” of NPRR 1186 “are likely to administratively limit access to energy” held by energy storage resources during an ERCOT emergency, the company warned.
The new rule “will substantially reduce energy storage participation in the ancillary markets and reduce competition,” Eolian CEO Aaron Zubaty said in an email. “The proposed changes are inherently discriminatory, holding energy storage resources to different and more punitive performance penalties than the rest of the participants in the ERCOT market.”