Brattle Experts Prepared an Energy Storage Market Reform Roadmap for Several US Electricity Markets
Prepared for the American Clean Power Association
In a new report prepared for the American Clean Power Association, Brattle experts have developed a roadmap of market design reforms designed to guide regional grid operators in maximizing the benefits of energy storage integration.
Wholesale electricity markets were initially designed largely around the capabilities and limits of conventional generators, and US electricity markets only recently integrated modern storage resources into their designs. Additional market reforms therefore present the opportunity to fully unlock the reliability and flexibility value of modern storage resources. The roadmap outlines priority reforms that three major US electricity markets – the Midcontinent Independent System Operator (MISO), PJM Interconnection (PJM), and New York Independent System Operator (NYISO) – can implement to enhance reliability and reduce costs.
The roadmap recommends:
- Developing a Day-Ahead Uncertainty Product to ensure sufficient capacity is available when forecasted demand exceeds physical supply scheduled through the day-ahead energy market;
- Creating an Intrahour Ramp/Uncertainty Product to procure and price flexibility for real-time net load ramps in the upcoming 10–60 minutes;
- Improving energy storage capacity value accreditation to accurately reflect the increase in reliability from adding storage;
- Enabling opportunity cost bidding for storage to maximize reliability benefits of storage and align incentives with system needs; and
- Addressing transmission reliability needs after resource retirement through competitive evaluation of a broad set of solutions, allowing for more cost-effective and timely grid adaptation.
The full report, “Energy Storage Market Design Reforms: A Roadmap to Unlock the Potential of Energy Storage,” and a summary document are available below.
