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Q&A: Jason Burwen, Energy Storage Association interim CEO

05 August 2021 Kevin Adler

In July, the Energy Storage Association (ESA) and the American Clean Power Association (ACP) announced plans to merge, bringing together leadership in North America's energy storage and renewable energy industries. If the ESA's membership approves the plan, the merger will be effective on 1 January 2022.

Net-Zero Business Daily spoke with Jason Burwen, who has been interim CEO of the ESA since January, about activity in energy storage and how working through ACP will bring more resources to defining the landscape for energy storage and renewables.

Net-Zero Business Daily: Tell us how the merger of the associations came about and what it means for ESA.

Burwen: The boards of directors of the organizations have explored this prospect for just under a year…. The ESA board unanimously approved the proposed merger because they see the organizations providing enhanced value to each other through a combination of resources.

I think the US energy storage industry is at an inflection point in its growth. We set before us last year a vision of 100 GW of new storage by 2030, our 100 x 30 Vision, and we're going to get there if we have expansive industry resources to support far-reaching policy advocacy and networking. That opportunity for having additional resources immediately by working with ACP will advance ESA's mission in the short term and also in the longer term for investments in research and education that are critical to continued market growth.

Net-Zero Business Daily: The merger of the groups brings to mind the increased frequency with which storage is paired with new renewable power installations.

Burwen: We see that the business prospects of the energy storage and renewables industries are increasingly intertwined. Our 100 x 30 Vision is based on renewable power providing half of all US electricity by the end of the decade. In a world where government and industry are increasingly focused on addressing the climate crisis … it makes good business sense to have a unified voice.

Net-Zero Business Daily: What are some of the ways you're seeing storage and renewable power work together now or that they can work together?

Burwen: Hybrid resources—where storage is integrated directly with wind, solar, or other generation—are obviously a rising asset class. We are seeing this in growing requests for interconnections with the grid.

We also see a significant benefit to stand-alone storage. What was important in talking to ACP was understanding and reflecting that … ACP is going to represent storage, whether it is integrated with renewables or independent. Both are absolutely critical for [facilitating a] high share of renewable generation.

Net-Zero Business Daily: Let's talk politics. What's the state of interest and support for storage from the White House and Congress and the states?

Burwen: There's enormous interest from policymakers at all levels of government. It's a compelling proposition. It presents a lot of opportunities to help save people money by reducing the spare amount of capacity needed on the power system and the [power transmission] infrastructure.

In particular, storage is going to play an increasing role at customers' premises for resilience.

Obviously, renewables are where we see the greatest complementarity, but storage is also going to be helping any supply mix operate well because of its controllability and flexibility.

Net-Zero Business News: As you pointed out, storage helps avoid the cost of overbuilding the system to ensure reliability. But can we also think of it in reverse: that storage allows for more rapid growth of renewables because it provides reliability?

Burwen: Within the context of the need for decarbonization, absolutely. I think that it depends on how you are going to balance the system. If you are going to balance by burning fossil fuels, that has different implications than if you are moving electrons across the grid at different times [to meet peak needs]. What makes storage really exciting from a renewables standpoint is that it's not just this simple balancing resource—there's so much more about power system operations that can benefit from widespread power storage.

Net-Zero Business Daily: Can you give our readers an example?

Burwen: One example is that moment-to-moment stabilization of the power system [can be achieved], as you go to higher levels of renewables. Battery energy storage does extremely well for managing frequency response; all the way up to dealing with transmission congestion, you are dealing with something that constrains the delivery of wind and solar to the load centers. Storage is important to ensure those deliveries can be done and the system can manage them, in the absence of greater transmission buildout. And curtailment avoidance is very important to making the business case for renewables.

Another example is that [we need] … systems that can manage greater and greater variability without creating the kinds of stresses that would make a grid operator nervous. [National Renewable Energy Laboratory's] 2019 study shows the value of storage at even just four hours' duration goes up dramatically as we go to higher levels of renewables, due to the changing nature of net load shapes.

Storage is a good insurance policy for much more expansion of renewables, for transmission buildout, for expansion to greater geographic regions, greater [use] of demand response—there are so many ways you can modify a power system driven by renewables to achieve reliability and efficiency. You are going to get backstop power through storage. This is critical for us to make the changes at the speed and scale we need to decarbonize the grid.

Net-Zero Business Daily: As a trade group, part of your mission is education, both of policymakers and the public. What's the understanding of storage today?

Burwen: Education is a key part of the work. One of the things that makes the merger powerful is that we will have the larger megaphone and the resources that ACP has in its research and education team. That is going to be really important for making sure this kind of information is reaching those it needs to and traveling farther than just power system stakeholders.

I think a lot of that is driven by a strong sense that this technology is here, it's only going to become better performing and more economically viable, and we should be doing what we can to take advantage of this opportunity. [Storage is critical] in the context of decarbonization of the power system, electrification of our economy, and adapting to the climate-driven weather extremes that are increasingly frequent. Storage can provide diversification and resilience.

On top of this, politicians on both sides of the aisle find it compelling that this industry is growing fast in the US, and US companies are leading globally. Fluence [owned by Siemens and AES] is the leading system integrator; companies like Stem and Powin are putting together energy storage product offerings that are world-class; and companies like Eos and ESS are manufacturing here.

We have done the work that other countries have not—to rethink our power markets and how storage can be compensated for its flexibility. That's why we're having the opportunity to create jobs and new investment, and to lead globally toward decarbonization goals.

Net-Zero Business Daily: Let's look out five years. What do you think and hope will happen in storage?

Burwen: First, I'm looking forward to how much more integrated advocacy will be among clean power industries. And transmission too, which is part of ACP's remit.

For the storage industry's specific interests … we are going to see, for example, a storage investment tax credit and availability of public and independent investments at a level playing field with other energy options. And this will be at a scale that our country needs for the challenges of upgrading our power supply and integrating more parts of the economy. Tax credits are a key part of meeting the pace of deployment needed for decarbonization.

In markets, I think that there already are implications in the way we are ensuring that storage is able to access the grid. I think we will have more thorough market designs to take advantage of the flexibility storage provides and update to where technology has gone. FERC Orders 2222 and 841 are a good start.

As ESA said after a federal court ruled in July 2020 that FERC Order 841 could be issued, enabling with the affirmation that energy storage connected at the distribution level must have the option to access wholesale markets: "This is an enormous step for energy storage … allowing homes and businesses to contribute to the resiliency, efficiency, sustainability, and affordability of the grid."

FERC Order 2222, which opens wholesale markets to aggregations of distributed resources, will just further push the storage business model, because storage will be at the heart of many aggregations—including as part of vehicle-grid integration.

Net-Zero Business Daily: It's not just federal policy either.

Burwen: States have traditionally led the way for power markets, and will continue to do, almost certainly. Three quarters of what happens in power systems is regulated by the states. We currently have nine states with storage targets. I would like to think that with the combined resources of the ACP that we expand that to half the country, just as renewable portfolio standards expanded.

Deployment targets are important long-term signals because we are making power system investments today that will last for decades. It's not enough to build renewable capacity and assume storage will show up when it's needed. Whether that's through targets or other ways to compensate storage for the value it provides, we need an accelerated agenda for meeting the country's clean energy and decarbonization goals and for adapting power infrastructure to climate change.

Net-Zero Business Daily: What about technology development?

Burwen: When we think about the pipeline of innovation coming, there are so many exciting technologies. Lithium-ion batteries will be here for the foreseeable future—and for good reason. But the next crop, whether it is new forms of thermal storage, new types of chemistries, different kinds of flow batteries, solid state, or other kinds—there are a lot of folks who seem to be solving problems, such as duration, achievable cost points, and system longevity. Five years down the line, I think some of those will be more clearly ready for prime time and deployed on power systems as part of the reliability mix.

Posted 05 August 2021 by Kevin Adler, Editor, Climate & Sustainability Group, IHS Markit

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