POWER November 2021 - 29

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2. The 2.8-MW/5.6-MWh Connolly battery energy storage system is located on the Pronghorn
Circuit near 15 solar farms in and around Lancaster, California. The Southern California Edison
(SCE) pilot project pairs solar with batteries to manage the flow of power. Courtesy: SCE
new elegant DC-coupled systems, U.S.
organized markets are not quite prepared
to handle the full complexity of these
systems operating as a single resource.
Some of the ISOs/RTOs are still implementing
market participation structures
for standalone storage, which may provide
key operational elements for hybrids
like the ability to accommodate state of
charge and duration limitations, and market
optimization given spreads between
charge and discharge bids.
When shaping rules for storage paired
with an intermittent renewable, it is important
to understand how the resource
will be classified and treated. Some
markets have afforded certain exemptions
and beneficial accommodations to
intermittent renewable resources. When
paired with storage though, intermittent
renewables become at least partially dispatchable
and perhaps need to be treated
by a different set of less lenient rules used
for traditional dispatchable resources.
The relative sizing of the renewable
generator, storage asset, and point of
interconnection, as well as daily and seasonal
weather variation, and whether you
can charge from the grid or not, creates a
nearly endless number of combinations
and scenarios. Each combination may
have unique impacts on the hybrid facility's
characteristics as a grid resource.
The capacity market, for example, needs
to implement accreditation rules to accommodate
all these variations appropriately.
Additionally, if the ISOs/RTOs treat
a hybrid facility as a single resource, they
must account for any limitations of the
facility for reliability purposes. Limitations
due to weather (such as available
sun if not charging from the grid) or batNovember
2021 | POWER
tery state of charge may impact if and
when it can be relied upon as a reserve
or regulation resource.
Framework Begins to Take Shape,
but One-Size Does Not Fit All
The Electric Reliability Council of Texas
(ERCOT) and California ISO (CAISO) have
been working on market participation
structures for hybrid storage resources the
longest, including those that are DC-coupled,
but both have different approaches.
ERCOT's approach treats a renewablestorage
hybrid as one resource, but operates
the facility at any moment as either
a renewable generator or as storage
and not as an entirely new and distinct
resource type. The market operator considers
whether the market offer from the
hybrid reflects the capability of the storage
component and whether the plant
is awarded ancillary services. If either of
these are true, the hybrid will be treated
as a storage resource, but if neither parameter
applies, then the hybrid will be
treated as an intermittent renewable resource.
PJM has also proposed a similar
two-mode approach.
CAISO's hybrid approach is a little different.
There, a hybrid resource is treated
as one resource that is primarily a fully
dispatchable resource optimized by the
market based on the resource's bid. Being
classified as a hybrid does lose some
favorable treatment as opposed to being
purely an intermittent renewable. Hybrids
follow CAISO's Non-Generator Resource
(NGR) model, which is also used by storage.
However, CAISO has proposed
to allow significant flexibility for hybrid
resources (Figure 2) to account for the
impacts of variable or intermittent renewwww.powermag.com
able
production through provisions that
incorporate and accommodate changes
in forecasted output due to weather.
The New York ISO (NYISO) on the
other hand has proposed treating a hybrid
facility as an aggregation of dissimilar
resources with different capacities,
as opposed to switching back and forth
between its existing intermittent renewable
and storage participation models.
However, NYISO also has a FERC-approved
co-located approach that treats
the renewable and storage assets as
separate resources but goes the extra
step to accommodate DC-coupling and
the shared interconnection point that is
smaller than the summed output of the
two resources, both of which are characteristics
people typically associate with a
hybrid participation model.
Aside from tax policy, the decision to
add energy storage to a renewable project
will depend on the treatment and
value of the asset as a standalone intermittent
resource, rather than if more value
can be obtained under the local rules
for co-located and/or hybrid resources.
Even with evolving or undefined rules
for hybrids, commercial interests have
been bringing huge amounts of hybrid
resources
to
interconnection
queues
around the country, which itself is pushing
ISOs/RTOs to develop new market
participation structures.
The active FERC investigation into hybrid
participation could continue this momentum,
but there is some disconnect
between prevailing desires for closely
coupled renewable-storage hybrids to be
treated like any other traditional generator
and grid operators' concerns about
whether it's possible or if it's any better
for the grid than keeping them separate.
Where ISOs/RTOs fall on these questions
seems to be a function of their local
rules and the ability of their energy
management systems (EMS) and economic
dispatching technology to accommodate
any new resource types and
various combinations and configurations.
One approach may not fit all. ■
-John Fernandes is a senior consultant
for emerging technologies, and
Tony Abate is a director for emerging
technologies, both with Customized
Energy Solutions (CES). CES helps
clients understand changes in the
wholesale and retail electricity, and
renewable energy credit (REC) markets.
CES also operates more than 11,000 MW
of their clients' wholesale generation,
renewable, storage, and load assets on
its hosted market operations platforms.
29

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POWER November 2021

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