Date: May 2025

Battery storage systems can offer a myriad of benefits ranging from resiliency, peak demand reduction, and energy arbitrage (to name a few). Programs incentivizing adoption of energy storage technologies are proliferating throughout the country – California provides upfront incentives for the installation of battery storage systems that serve a customer’s needs. In other states like Massachusetts, New York, and Vermont, different models are emerging ranging from utility ownership of batteries, utility/aggregator dispatch of batteries, and pay for performance programs. California currently finds itself at a crossroads regarding the future of battery storage. The State has provided incentives for tens of thousands of battery storage systems and produced tangible benefits to both participants and non-participants, providing resiliency during multi-day outages, generating greenhouse gas (GHG) emissions reductions, reducing system peak load, and delivering bill savings to customers. At the same time, research has shown that residential batteries are only discharging roughly 45% of their kWh capacity on average on a daily basis and 16% of their kW capacity during the system peak hour. As California looks to the future, should its battery program be considered a success given the benefits listed above, or are we only beginning to scratch the surface of potential benefits? Optimal dispatch modeling suggests that a battery optimized to provide grid benefits could provide 4x the societal benefits than systems are currently providing, and a system optimized for GHG emissions reductions could achieve 3x the reductions observed today. Exposing customers to marginal-cost based rates could dramatically improve grid benefits but significantly reduce bill savings.

Speakers:
Melissa Leymon, Oracle Utilities
Dave Alspector, Tierra Resource Consultants
William Marin, Verdant Associates
Maya Noesen, CPUC