Energy Storage Market Transformation through Stored Energy Targets

Aggressive energy decarbonization targets will require the rapid deployment of renewable energy in the U.S. in coming years. As the amount of variable generation on the grid grows, there will be an increasing need for long-duration energy storage (LDES) technologies to reconcile intermittent generation with customer demand. Meeting that need will require a suite of technology alternatives with different capabilities. Many of these alternatives, however, are in a nascent state and face significant commercialization challenges. In the last decade, 12 U.S. states have enacted energy storage mandates as a vehicle for market transformation to accommodate energy storage. Those mandates, however, fail to send appropriate investment signals for LDES technologies because they are based on energy storage capacity and treat all technologies the same, regardless of duration. This paper explores the idea of replacing capacity-based storage procurement targets with stored energy targets, which would be technology-neutral policies that enable the market transformation necessary to support a competitive LDES industry.