Energy Storage: Power System Game Changer

Transcription

1 Energy Storage: Power System Game Changer Prepared for Minnesota Energy Storage Summit 2015 Janice Lin Managing Partner, Strategen Consulting, LLC Executive Director, California Energy Storage Alliance Chair, Energy Storage North America Chair, Global Energy Storage Alliance July 14, 2015

2 Objectives» Strategen CESA ESNA GESA Introduction» Why Storage is a Game Changer» California Update» Share Lessons Learned» Open Dialogue RE: Implications for Minnesota» Find New Champions Confidential

3 Introduction Strategen Consulting» Started consulting in PV and energy storage space in 2005» Unique focus in strategic advisory work in the clean energy industry California Energy Storage Alliance (CESA)» Founded in January, 2009» 80++ member companies» Active in over 20 regulatory proceedings at CPUC, CAISO, and CEC Energy Storage North America (ESNA)» Largest grid storage conference in the world» 28 countries in attendance» Next event: October 13-15, 2015 San Diego Convention Center 2015 Strategen Consulting 3

4 Strategen Clients Strategic thinking and industry expertise creates profitable clean energy businesses A sampling of our clients: U.S. Department of Energy California Energy Storage Alliance

5 CESA STEERING COMMITTEE MEMBERS CESA 2015 MEMBERSHIP 1 Energy Systems Inc. EDF Renewable Energy Abengoa Elevation Solar Advanced Microgrid Solutions ELSYS Inc. AES Energy Storage Energy Storage Systems, Inc. Aquion Energy Enersys ARES North America EnerVault Corporation Brookfield Enphase ENERGY Chargepoint EV Grid Clean Energy Systems Flextronics CODA Energy GE Energy Storage Consolidated Edison Development, Inc. Green Charge Networks Cumulus Energy Storage Greensmith Energy Customized Energy Solutions Gridtential Energy, Inc. Demand Energy Hitachi Chemical Co. Duke Energy Ice Energy Dynapower Company, LLC IMERGY Power Systems Eagle Crest Energy Company Innovation Core SEI, Inc (A Sumitomo East Penn Manufacturing Company Electric Company) Ecoult Invenergy LLC K&L Gates LG Chem Power, Inc. LightSail Energy Lockheed Martin Advanced Energy Storage LLC LS Power Development, LLC Manatt, Phelps & Phillips, LLP Mobile Solar NEC Energy Solutions, Inc. NextEra Energy Resources NRG Solar LLC OutBack Power Technologies Panasonic Parker Hannifin Corporation Powertree Services Inc. Primus Power Corporation Princeton Power Systems Recurrent Energy Renewable Energy Systems Americas Inc Rosendin Electric S&C Electric Company Saft America Inc. Sharp Electronics Corporation Skylar Capital Management SolarCity Sony Corporation of America Sovereign Energy STEM SunEdison SunPower Toshiba International Corporation Trimark Associates, Inc. Tri-Technic Wellhead Electric YOUNICOS

6 Steve Berberich President & CEO CAISO Doug Little Commissioner AZ Corporation Commission Anne McEntee President & CEO, Renewables GE Power & Water Pedro Pizarro President Southern California Edison Michael Quinn Vice President & CTO Oncor Electric Delivery

7 Advance education, collaboration, knowledge and proven frameworks about the benefits of energy storage globally» Learn from local market development efforts, help proliferate best practices» Foster collaboration among key stakeholders including policy makers, utilities, renewable energy community, financial institutions and environmental organizations» Help establish standards and protocols to advance energy storage acceptance worldwide

8 Objectives» Strategen CESA ESNA GESA Introduction» Why Storage is a Game Changer» California Update» Share Lessons Learned» Open Dialogue RE: Implications for Minnesota» Find New Champions

9 Storage uses a time-tested tradition 9

10 We can bottle sunshine and wind 10

11 Power System Gamechanger: ENERGY STORAGE

12 Storage is already a part of our everyday lives 12

13 Many solutions are available today Electro-Chemical Mechanical Bulk Mechanical (Flow battery / Lithium Ion ) Thermal (Flywheel) Bulk Gravitational (Compressed Air) Transportation (Ice / Molten Salt) 2013 Strategen (Pumped Hydro) Consulting (Electric Vehicles)

14 Storage is a fast growing California industry

15 ASSUMPTION Renewable energy will be wasted FACT Energy storage can match renewable generation to demand

16 We make jam out of sunshine. Make it Store it Use it 16

17 Example 1: Self-consumption in Germany Feed-in tariffs, high electricity rates, and the growing availability of storage systems are making self-consumption a much more attractive option for German solar producers» Self-consumption refers to on-site energy production for on-site energy consumption (while receiving value for electricity fed to the grid).»the Rise of Self-consumption in Germany: Private electricity prices are now almost twice as high as the cost of self-generated solar electricity from the roof of a house Feed-in-tariff: 0.15 Electricity rates: Germany s KfW Development Bank is offering low-interest loans for the installation of a combined PV and storage system or for retrofitting an existing solar plant with a battery. FIT Rate for Small-Scale Systems versus Residential Retail Electricity Rates in Germany Electricity Cost exceeds PV Cost

18 Example 2: We build peaker plants to do one job Peaker Replacement

19 Comparing Energy Storage With The Status Quo VS. Natural Gas Peaker Energy Storage Key Criteria to Consider Siting Constraints Installation Speed Available Flexible Range Capacity Factor (hours of operation/year) Multiple Value Stream Capture Ramp/Response Rate Total Emissions Water Usage 19

20 Energy Storage Can Be Sited Closer to the Load ES Siting Source: Powertree Integrated Energy Services Russell City Energy Center Hayward, Ca 20

21 Energy Storage: Diverse, Modular, Faster to Install! Battery and thermal storage resources can be installed much more quickly than traditional resources, reducing risk and increasing technology flexibility Siting, Permitting, and Installation Time by Resource Battery/Thermal Storage Combustion Turbine Minimum Time Maximum Time CCGT Time in Years 21

22 Energy Storage Can Respond Faster and is More Effective Energy storage responds far more quickly and is more effective LMS 100 Gas Peaker Plant Full Power Ramp 10 Minutes Energy Storage System Full Power Ramp <1 second Graph Source: Kirby, B. Ancillary Services: Technical and Commercial Insights. Wartsilla, July, pg

23 Energy Storage: Four Times the Flexible Range Important to compare benefits, not megawatts 100MW Max. Output 50 MW Range 100MW Discharge 50MW Min. Output 200MW Range -100MW Charge 100MW LMS 100 Gas Peaker Plant 1 100MW Energy Storage System 1. Source: 23

24 Energy Storage: Three Times the Utilization Energy storage can be utilized more fully throughout the year Startup Time Startup Time Shutdown Time Shutdown Time Min Utilization Min Utilization Max Utilization Max Utilization 0% 50% 100% Unutilized 0% 50% 100% Unutilized 100 MW LMS 100 Gas Peaker Plant 1 20%-40% Utilization >95% Utilization 100MW Energy Storage System 1. Source: 24

25 PEAKER Years to install Slow to respond Does one thing Dirties air Used 5% of time Wastes water STORAGE Months to install Fast to respond Does many things Keeps air breathable Used 95% of time Water saver

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27 ASSUMPTION Energy storage isn t viable. FACT Energy storage is already saving money throughout the US

28 Energy Storage in the news (April-May 2015)

29 Validation of Cost Effectiveness: SCE (2014) Southern California Edison chose to procure over 5x the amount of energy storage than required by the CPUC to meet Local Capacity Requirements (LCR)» 50 MW of energy storage required. 261 MW Procured» Over 1,800 offers of all resource types competing Seller Selected Energy Storage Resources Resource Type Total Contracts Max Quantity (LCR MW) AES In-Front-of-Meter Battery Storage Advanced Microgrid Solutions Behind-the-Meter Battery Storage Ice Energy Behind-the-Meter Thermal Storage NRG Energy Behind-the-Meter Battery Storage Stem Behind-the-Meter Battery Storage Total Source: SCE RFO winners.

30 Objectives» Strategen CESA ESNA GESA Introduction» Why Storage is a Game Changer» California Update» Share Lessons Learned» Open Dialogue RE: Implications for Minnesota» Find New Champions

31 California: Home to the World s Largest Geysers Geothermal Plant 955 MW Lake County, CA Solar Star Silicon PV Project 579 MW Kern County, CA Alta Wind Energy Center 1550 MW - Kern County, CA SCE Tehachapi Li-Ion Battery 8 MW/32 MWh Tehachapi, CA Ivanpah Solar Thermal Project 393 MW - San Bernardino, CA Desert Sunlight Thin-Film PV 550 MW Riverside, CA 31

32 California as a Role Model 2013 California AB 2514 Sets GW energy storage target - passed 2014 Arizona All-Source Procurement with Storage Carve-out required for Arizona Public Service 2014 Hawaii PUC directed HECO to prepare energy storage plans. Large RFP issued for up to 200 MW of energy storage 2015 Oregon HB 2193 Sets 5 MWh energy storage target passed 2015 US Senate Energy Storage Promotion and Deployment Act of 2015 Sets national mandate equal to 2% of 2024 peak load - introduced Takeaway California can be a learning lab for other jurisdictions 32

33 Variety of factors Advancing Energy Storage in CA» AB ,325 MW procured by 2020» Renewables integration driving need for Flexible Capacity Estimated 7,500 11,000 MW of flexibility needed» Long Term Procurement Planning from OTC and SONGS retirement (6,029 MW OTC retiring by 2024) SCE (50 600MW) SDG&E (25 300MW)» CAISO Reforms to Wholesale Market Market design updates specific to storage Storage being considered in transmission planning process Updates to interconnection process» SGIP - $83M/year through 2019» Net Energy Metering / Rate Design 33 Confidential, Copyright 2015 Strategen Consulting LLC

34 California Policy Landscape Leadership From Our Governor Governor Jerry Brown s State of the State Address January 5, Governor s ambitious new clean energy 2030 goals:» Increase renewable electricity use from 33% to 50%» Reduce petroleum use in cars & trucks by up to 50%» Double the efficiency of existing buildings and make fuels cleaner» Reduce emissions to 40% below 1990 levels (April Executive Order)

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36 Energy storage accepted as key to enable greater grid flexibility CAISO estimate: system-wide 2014 flexible capacity requirement of 7,520 MW (May) to 11,212 MW (Dec) Actual Net Load Curve for April 12, % of prices were zero or negative Chart Source: Prepared statement of Mark Rothleder on behalf of the CAISO (February 20, 2015). * Source: CAISO Final 2014 Flexible Capacity Needs Assessment May 2014

37 Significant renewable curtailment forecasted at 40% RPS Estimated Renewable Curtailment Frequency and Magnitude in 2024 at 40% RPS Source: Phil Pettingill, Governor s Greenhouse Gas Reduction Goals

38 Governor Brown Sponsored AB 2514 in 2010 Resulting CPUC Requirement: GW in operation by 2024 Use case category, by utility Total Southern California Edison Transmission Distribution Customer Subtotal SCE Pacific Gas & Electric Transmission Distribution Customer Subtotal PG&E San Diego Gas & Electric Transmission Distribution Customer Subtotal SDG&E Total all 3 Utilities ,325

39 Results of Strategen s Production Cost Modeling with Storage % of total CA Generation Capacity Unit Starts Reduced in CA* Curtailment Reduction in CA GW Storage (only 2 hour storage) GW Storage (2, 4, & 6 hour storage) 2.65 GW Storage (2, 4, & 6 hour storage) 0.5% 1.7% 3.4% 3,000 8,000 13, % 23.3% 40.0% *Numbers are rounded for simplicity» Even a small amount of energy storage makes a big system impact» There are diminishing returns to additional storage, but the benefits have not yet plateaued» Under the storage scenarios, 3-4 emergency peaker natural gas plants were removed from dispatch 39

40 California utilities are far exceeding their mandated targets (Figures in MW) 2014 Proposed Procurements Transmission Distribution Customer Total IOU (Existing or In Progress) CPUC 2014 Target (AB 2514) PG&E * 90 SCE Open Ended > ** 90 SDG&E *** 20 Totals > > Source: California Public Utilities Commission *Excludes 150 MW Rice Solar to be counted in future solicitations **Includes 261 MW of storage projects under procurement from December 2013 LCR solicitation ***Includes 40 MW Lake Hodges Pumped Hydro and min 25MW LTPP Track 4 LCR requirement by 2022

41 Validation of Cost Effectiveness: SCC Track 1 LCR RFO (2014) Southern California Edison chose to procure over 5x the amount of energy storage than required by the CPUC to meet Local Capacity Requirements (LCR)» 50 MW of energy storage required. 261 MW Procured» Over 1,800 offers of all resource types competing Seller Selected Energy Storage Resources Resource Type Total Contracts Max Quantity (LCR MW) AES In-Front-of-Meter Battery Energy Storage Ice Energy Behind-the-Meter Battery Energy Storage Advanced Microgrid Solutions Behind-the-Meter Battery Energy Storage Stem Behind-the-Meter Battery Energy Storage Total Source: SCE RFO winners.

42 SCE Energy Storage LCR RFO Results Total Energy Storage Offered (1590 MW) Customer- Connected 1 Grid- Connected 2 Ice Energy Holdings, Inc. Contracted Energy Storage (261 MW) Stem AES Advanced Microgrid Solutions NRG Energy, Inc. Counterparty AES; NRG Energy, Inc. Advanced Microgrid Solutions; STEM Ice Energy Holdings, Inc. Technology Large scale lithium ion battery installation Distributed customer-sided lithium ion battery installations that offer Demand Response-like load drop Distributed customer-sided thermal storage that reduces Air Conditioning load Source: SCE

43 Distributed storage will play a key role The Self Generation Incentive Program (SGIP) is one of the longest-running and most successful distributed energy resource incentive programs in the US» Incentive program launched in 2001 to encourage customer sited distributed generation. Provides financial incentives for the installation of qualifying technologies installed to meet all or a portion of the electric energy needs of a facility.» Annual Budget: $83million (through 2019)» $1.42/Watt for Advanced Energy Storage (min 2 hours duration)» Administered by CA utilities Capacity Incentive Rate (% of Base Cost) 0 1 MW 100% 1 2 MW 50% 2 3 MW 25%» New program criteria ( ): Cost effectiveness of Greenhouse Gas (GHG) emission reductions over the useful life of the resource will determine eligibility and incentives levels. Reductions of aggregate, non-coincident customer peak demand and improved onsite electricity reliability.

44 SGIP Reservations Energy Storage 2014 Funding Allocations $1,150,067 $1,166,400 $66,015,336 $3,742,120 $7,192,022 $7,196,735 Grand Total: $86,462,681 Other Danko Enterprises CODA Energy Green Charge Networks Stem Inc Tesla 2014 Allocation by Technology Technology Data source: SGIP Quarterly Statewide Report Note: Total 2014 SGIP budget was $165M (includes carryover funds from prior years) % of Incentive Wind Turbine 2.0% Gas Turbine 2.3% Microturbine 3.5% Internal Combustion 4.9% Fuel Cell CHP 6.4% Fuel Cell Electric 34.9% A.E.S. 46.0% 67% of December 2014 reservations were from Tesla ($20.5M)

45 AB 327: Net Metering 2.0 Actions and Impacts Action Lifts caps imposed on rate increases levied during the energy crisis Allows IOUs to develop tariffs with fixed charges Such charges would be capped at no more than $10/month for residential and $5/month for CARE customers. Starting Jan , the fixed charges can increase by CPI. Beginning January 1, 2018, the CPUC may require or authorize an electrical corporation to employ default TOU pricing to residential customers. Beginning July 1, 2017, electrical corporation (>100,000 customers) must provide new NEM tariff (or earlier, if they met their 5% aggregate peak demand NEM cap) Impact on Energy Storage Fixed charges can be good or bad for storage. If they are time based, more similar to demand charges, then they could promote storage adoption TOU pricing may make residential behind the meter load shifting attractive for storage, but will not entirely justify storage systems. NEM rules affect behind the meter storage value proposition. Tariff details will determine the final impact. New NEM tariff to be developed by Dec 31, 2015 (note: applies to solar, wind and fuel cells) Requires electrical corporations to consider non utility owned DERs as an alternative to investments in their distribution system. Requires by July 1, 2015 for all electrical corps to submit to the CPUC a distribution resources plan to help identify optimal locations for DERs. Understanding where there are opportunities in the distribution system is a great application for storage. Defines the RPS target of 33% as a floor, not a ceiling Strategen Consulting More renewables means more opportunity for storage.

46 Objectives» Strategen CESA ESNA GESA Introduction» Why Storage is a Game Changer» California Update» Share Lessons Learned» Open Dialogue RE: Implications for Minnesota» Find New Champions

47 Lessons Learned from California Experience Leadership + Focus + Collaboration = Progress

48 Importance of Leadership What you focus on is what you get!

49 Best Practices for Stakeholder Engagement: Focus! STEP 0 STEP 1 STEP 2 STEP 3 Create broad awareness of about the role of grid storage Identify and engage with key stakeholders Determine regionally appropriate applications considering both supply and demand Identify status quo alternatives to storage applications STEP 4 STEP 5 STEP 6 STEP 7 Independently assess the system value of storage applications versus status quo alternatives Reconvene results and prioritize applications with greatest benefits Determine the barriers to applying storage in high priority applications Work with key stakeholders to build practical implementation plans and programs

50 Collaboration is the key to success Collaboration Best Practices 1. Leadership individual champions 2. Stakeholder Engagement - establish common understanding of how storage can be used 3. System Analysis - agreed upon approach to cost effectiveness 4. Technology neutrality - monetize services delivered 5. Consistency - legal and regulatory framework to monetize value streams and overcome barriers 6. Sharing - leverage tools/best practices/experiences of others

51 Objectives» Strategen CESA ESNA GESA Introduction» Why Storage is a Game Changer» California Update» Share Lessons Learned» Open Dialogue RE: Implications for Minnesota» Find New Champions

52 Minnesota Electricity Overview» MISO: Midcontinent Independent System Operator Over 170,000 MW generation capacity (Market)» Minnesota State Energy Profile Coal-fired power plants provide nearly 50% of generation Nuclear power plants provide around 20% of generation Wind power provides 15% of generation Energy Information Administration, 2013

53 Energy storage is like bacon It goes well with everything! 53

54 Energy Storage in Minnesota (source: DOE database)» Total kw: 1297 kw of storage (1) Sodium-Sulfur Battery: 1,000 kw (9) Lead-Acid Batteries: 297 kw» XCEL Minwind Wind-to-Battery Project Luverne, Minnesota Technology Type Rated Power in kw 1,000 Sodium-Sulfur Battery Duration at Rated Power (HH:MM) 7:12

55 Previous Strategen Work» Utility Controlled Energy Storage Improves energy and grid efficiency Delivers backup power to consumers Reduces greenhouse gas emissions Can align wind and solar energy with peak grid demand and intermittency» Made in Minnesota Energy Storage Program Create a statewide energy incentive program Reduce costs through debates of utility controlled, customer sited energy storage equipment if manufactured in Minnesota

56 Benefit-to-Cost Ratio Ranges by Modeled Use Case For each case, a benefit-to-cost (B/C) ratio was generated to show the direct, quantifiable fixed and variable costs and benefits, incorporating the time value of money, for the modeled project over its lifetime. A benefit to cost ratio greater than one means that the modeled benefits exceed the project costs; in other words, the net present value (NPV) was greater than zero, and for this study had an return (IRR) greater than the 11.5% discount rate

57 Whitepaper Conclusions for Minnesota 1. Energy storage has the potential to provide multiple sources of value for customers and utilities. 2. Utility controlled, customer sited storage in Minnesota has the potential to provide benefits to the grid greater than the system s cost. 3. Customer sited commercial and residential storage that relies upon customer tariffs were not able to achieve a benefit to cost greater than one. 4. Reliability (backup power) and voltage support service benefits of energy storage, while conceptually attractive, have not been found to be materially sufficient to significant impact the cost-effectiveness of energy storage. 5. Certain storage benefits can vary by utility type. Energy storage should be modeled according to the benefits within a specific utility and to best suit each utility s characteristics.

58 Objectives» Strategen CESA ESNA GESA Introduction» Why Storage is a Game Changer» California Update» Share Lessons Learned» Open Dialogue RE: Implications for Minnesota» Find New Champions Confidential, Copyright 2015 Strategen Consulting LLC

59 Anyone can be a Champion! Meet Lon Huber, Strategen Director» Prior to joining Strategen, served in the Arizona consumer advocate office (RUCO) where he was the staff lead on resource procurement and distributed generation» Negotiated an agreement between Arizona Public Service (APS) and RUCO to require APS to analyze (with an independent evaluator) storage, efficiency, renewables and demand response as a potential alternatives prior to building or upgrading conventional power plants» Required APS to utilize energy storage as a companion resource to new natural gas peaking plants equal to at least 10% of the natural gas plant s capacity» Mandated at least 10 MWh of operational storage by 2018 Confidential, Copyright 2015 Strategen Consulting LLC

60 It takes a village Confidential, Copyright 2015 Strategen Consulting LLC

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62 Helpful Links for More Information Founder & Managing Partner Strategen Consulting» Strategic advisory exclusively in clean energy» Clients: governments, utilities, corporations» Co Founder & Board Chair Global Energy Storage Alliance (GESA)» Educational non profit founded January 2014» Co Founder & Executive Director California Energy Storage Alliance (CESA)» Industry advocacy group founded in January 2009» 90+ member companies» Co Founder & Conference Chair Energy Storage North America (ESNA)» Largest storage conference in the world» Next event: October 13-15, 2015 San Diego Convention Center.»

63 Questions? Janice Lin Managing Partner 2150 Allston Way, Suite 210 Berkeley, CA O x101 M F jlin@strategen.com

64 Countries Leading Energy Storage Deployment (non-hydro)

65 Global Projected Energy Storage through 2020

66 Operational Energy Storage (non-hydro)

67 Planned Operational Energy Storage (non-hydro)

68 Tesla s Powerwall the power of Consumer Demand Tesla unveiled its stationary storage product, Powerwall, on April 30, The battery charges from solar PV, or when utility rates are low.»intended for Germany self-consumptions market»sold OUT until mid 2016 in North America!»Transformative consumer demanddriven sales»tesla s unveiling was a great PR event for the entire storage industry

69 CAISO reforms enabling storage in wholesale market» Market Design New rules for storage set for: Effective flexible capacity / Flexible RA Net qualifying capacity / System and Local RA Distributed energy resources» Transmission Planning Non-Conventional Resource study methodology piloted in 2013; implemented system-wide in the 2014 study process Cluster 8 closes on April 30 th. We will update with new information as it becomes available.» Resource Interconnection Approximately half of CAISO s most recent applications have storage components representing more than 2,300 MW of new storage capacity CAISO allowing generators to add storage to existing projects Generator interconnection process under reform

70 Utility-Managed, On-Site Energy Storage in Minnesota Presentation Prepared for the Minnesota Department of Commerce, Division of Energy Resources» In 2013, the Minnesota Department of Commerce contracted with Strategen and the Electric Power Research Institute to investigate the potential costs and benefits of grid-connected electrical storage technology located at the utility customer in Minnesota» Strategen found that utility controlled, customer sited storage in Minnesota has the potential to provide benefits to the grid greater than the system s costs and may need to capture THREE of the FOUR following key benefits to be economic: a. Distribution upgrade deferral b. Frequency regulation c. System capacity d. Co-located and configured with PV to capture the Federal Investment Tax Credit (FITC)» Customer controlled, customer sited storage that relies upon customer tariffs alone did not result in economic value without incentives

71 Use Cases Case 1: Customer Bill Savings Case 2: Utility Controlled Distribution Only» Storage can shift from on-peak to off-peak night» Storage can shave peaks of usage to reduce demand charges» Storage may be available to provide back-up power if configured as a uninterruptible power supply» Results reveal challenging economics for customer controlled storage without additional incentives» Storage can shave peaks from circuit loads to defer or avoid new capital expenditure» Storage may also provide both real power and reactive power to manage high penetration solar» Substantial value from upgrade deferral possible but typically insufficient as a single benefit stream to justify the costs of an energy storage system Case 3: Utility Controlled - Distribution + Market» Similar peak shaving operation of storage may also offset the buildout of new generation» Wholesale energy and ancillary services markets provide additional revenue» Benefit stacking can provide a cost-effective outcome with simultaneous need for generation & distribution upgrades, and access to operational market benefits Case 4: Shared Control» Customer demand bill savings top priority» Potential to capture FITC when properly co-located and configured with a PV system» Market ancillary service value off-peak when customer isn t using it» Market participation benefit stacking in conjunction with PV significantly improves the economics as compared to the Customer Only Control (Use Case #1)

72 Overall Modeling Conclusions» Current tariffs in Minnesota do not show clear customer ownership benefit» Cost-effective cases stacked multiple major benefits, including distribution deferral, system capacity, frequency regulation, and solar investment tax credit Benefit stacking may have near-term technical and regulatory challenges» Existence of distribution deferral and system capacity is limited by need, defined in utility IRP and distribution planning processes Typically requires load growth» New storage need may emerge when new flexibility constraints arise from large penetrations of wind & solar California is working to develop new tools and methods to plan for flexibility need and assess resources