Technologically driven disruption is going to happen whether we like it or not

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2 Technologically driven disruption is going to happen whether we like it or not

3 Regulators should try to establish the conditions for change to occur with appropriate protections for consumers

4 and then let the competitors have at it

5 In telecom, regulation hasn t even yet caught up with the new markets.

6 For energy markets in New York, we're trying to keep up with the curve

7 Regulated competition does not work.

8 We must not allow our regulatory structures to stifle competition in energy markets

9 And this is not the time for regulators to be picking winners or losers. You're Fired

10 Key Objectives for Energy Storage Ratepayer savings: Increase the use of energy storage to reduce or flatten electric demand, resulting in ratepayer savings. Increase usage with a variety of renewable sources: Enable flexible renewable uses without the need for new fossil fuel peaker plants to achieve 50 percent renewable generation with a 40 percent reduction in greenhouse gas emissions by Economic growth: State already working to support the growth and expansion of the energy storage sector.

11 Key Objectives for Energy Storage NYSERDA recently issued a report showing that jobs in the energy storage sector grew to approximately 3,900 a 30 percent from 2012 through 2015, while annual global industry revenues reach an estimated $906 million during the same period, a 50 percent increase The report projects that by 2030, New York s energy storage industry could realize annual global revenues between $5.6 billion and $8.7 billion, with total job growth between 17,300 and 26,800 employees

12 NYS Strongly Supports Energy Storage New York has Invested in more than 50 energy storage technology-development projects across the state Collaborating with technical assistance contractors, developers, permitting agencies, and customers to reduce soft costs by 25 percent in three years and 33 percent or more in five years compared to a 2016 baseline Soft costs include customer acquisition, permitting, interconnection and finance cost for energy storage systems which can account for 25 percent or more of the total installed cost of a system

13 Accelerating Solar-Plus-Storage through the Clean Energy Fund DPS staff will work with NYSERDA and market participants to develop an Energy Storage Roadmap that identifies: current and anticipated electric system needs that energy storage is uniquely suited to address, levels of energy storage that provide net benefit to customers, and, market-backed policies, consistent with REV objectives, to build energy storage in New York State

14 REV Objectives for DER 1. Peak load reduction We want resources that can levelize the peak to avoid unnecessary investment or stress on the system 2. Quick responding resources Wind and solar resources as they gain in penetration will change the nature of operations. We will have peaks and valleys based on the availability and unavailability of these resources during a single day unrelated to load. Load based resources that can fill the trough when these intermittent resources are not available will avoid the need for responsive fossil generation.

15 REV Objectives for DER 3. Load shifting - Some resources such as wind are at the highest availability when load is lowest. The ability to load resources such as batteries, hot water heaters, or delayed operations of smart machinery during these periods will aid in making the system more efficient 4. Voltage support and frequency management - Opportunities to manage local support with resources that can provide it and further support capabilities of the system 5. Environmental benefits - Meet goals of the Clean Energy Standard 6. Resiliency - Recover from storm and equipment failures

16 REV: Next Steps Distributed System Platforms Utility DSIPs will serve as the venue for pursuing increased DSP functionality Increased DSP functionality and capabilities are key for granular pricing of DER DER Oversight & Consumer Protection More to come BCA Handbooks Staff plan to engage with stakeholder over the coming year to work through aspects of the BCA handbooks

17 Storage in DSIPs In the DSIP Guidance Order (April 2016), the Commission directed utilities to develop a methodology for determining energy storage impacts in their Supplemental DSIP filing. Key Concepts: Defer Upgrades Support Intermittent DER Shift System Load

18 Storage in DSIPs Normalize prices Address the Duck Curve Provide Reactive Power and Voltage Support Serve Multiple Roles with Multiple Benefits

19 ConEd Rate Case The Standby/Export Pilot: Innovative Standby Rate Design Metering and Customer Data Reporting Engagement with Permitting Authorities

20 ConEd Rate Case: System Peak Reduction Combination of projects to achieve peak reduction target

21 Commercial Battery Storage Demo Test hypothesis: Is front-of-the-meter storage more cost-effective, scaleable and socially beneficial than behind-the-meter storage?

22 ConEd's Second Battery Demo Recently filed; not yet approved Mobile batteries will get more use than fixed batteries Can be moved where needed most

23 ConEd's Second Battery Demo There May Be Need For: T&D Deferrals Contingencies Wholesale Market Services