U.S. Energy Storage Monitor:
2015 Year in Review Executive Summary
March 2016
About This Report
U.S. Energy Storage Monitor is a quarterly publication of GTM Research and the Energy Storage
Association (ESA). Each quarter, we gather data on U.S. energy storage deployments, prices, policies,
regulations and business models. We compile this information into this report, which is intended to
provide the most comprehensive, timely analysis of energy storage in the U.S.
Notes:
• All forecasts are from GTM Research; ESA does not predict future pricing, costs, or deployments
• References, data, charts and analysis from this report should be attributed to “GTM Research/ESA U.S. Energy Storage Monitor”
• Media inquiries should be directed to Mike Munsell from GTM Research ([email protected]) or Matt Roberts
with the Energy Storage Association ([email protected])
For more information or to purchase the full report, visit www.energystoragemonitor.com.
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
1
2015 Energy Storage Scorecard
2015
2014
Change
Total Deployments (MW)
221
65
Up 243%
Total Deployments (MWh)
161
86
Up 88%
Front-of-Meter Deployments (MW)
187
58
Up 223%
Behind-the-Meter Deployments (MW)
35
6.9
Up 405%
$700-$1,200
$800-$1,300
Down 8% to 13%
6,638
3,630
Up 83%
20 State Markets, 4 Regional
Markets, and Federal
10 State Markets, 1 Regional
Market, and Federal
13 Additional Markets
4,030 (2016-2020)
2,294 (2015-2019)
Up 76%
Utility-Scale System Price ($/kWh)
Utility-Scale Pipeline (MW)
Number of Markets With Policy
Developments
Cumulative Five-Year Forecast (MW)
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
2
A Record Year for U.S. Energy Storage Market With 221 MW of Deployments
Behind the Meter
Front of the Meter
40
180
160
140
120
100
80
60
40
20
250
U.S. Energy Storage Deployments (MW)
U.S. Energy Storage Deployments (MW)
200
U.S. Energy Storage Deployments (MW)
Total
35
30
25
20
15
10
5
2012
2013
2014
2015
200
150
100
50
0
0
0
221
2012
2013
2014
2015
2012
2013
2014
2015
• 221.4 MW of energy storage was deployed in 2015, making it the largest year for reported deployments, with a 243% increase from total MW deployed in 2014
• The front-of-the-meter segment grew more than twofold from the previous record and tripled in deployments from last year
• The behind-the-meter sector grew fivefold compared to 2014
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
3
PJM (Excl. NJ), California and Hawaii Led Utility, Non-Residential, and Residential Segments in 2015
Rank
Residential
Non-Residential
Utility
1
Hawaii
California
PJM (excl. NJ)
2
All Others*
All Others*
All Others*
3
California
New York
Hawaii
• PJM (excl. NJ) was the largest utility-scale market in 2015, followed by All Others. California’s AB 2514 mandate procurement has not
resulted in any front-of-meter deployments to date, keeping it out of a top-three spot in 2015.
• California was the largest non-residential market in 2015, 24 times bigger than the second-largest market, All Others.
• The residential segment continues to be diverse, with a significant number of projects deployed in emerging markets in 2015.
Hawaii made changes to its net energy metering policy and showed promise in the second half of 2015, taking the top spot for
residential segment deployments .
*GTM Research is currently monitoring seven individual markets. Complete coverage of all markets is available in the full report.
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
4
Lithium-Ion Technologies Made Up 96% of 2015 Deployments (MW)
Energy Storage Deployments by Technology
(MW)
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Q1 2013
Q2 2013
Lithium Ion
Q3 2013
Q4 2013
Q1 2014
Lead Acid
Q2 2014
Sodium Chemistries
Q3 2014
Q4 2014
Flow - Vanadium
Q1 2015
Q2 2015
Flow - Zinc
Q3 2015
Q4 2015
Other
• In 2015, lithium-ion systems made up 96% of the total MW deployed, compared to 72% in 2014. Some of this difference can be
attributed to a few large demonstration projects in 2014.
Other includes flywheel and unreported energy storage technologies
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
5
Front-of-the-Meter Policy and Market Developments, Q4 2015
Washington
MISO
New York
HB 1897, a bill pertaining to rare earth element
research, went into effect. FERC denied a
proposal for the Klickitat Pumped Storage Project.
WA Department of Commerce opened two grant
solicitations under Clean Energy Fund 2.
MISO created a platform to address storage-related
market rules and questions, ranging from development
of a fast AGC signal to tariffs and storage classification.
PSEG Long Island amended its South Fork
Resources RFP and issued a new renewable
capacity and energy RFP. NY PSC and NYSERDA
authorized the Clean Energy Fund. Con Edison
and Orange and Rockland issued a grid-scale
energy storage RFI.
California
SCE and UCSD joined CalCharge. PG&E awarded
energy storage contracts under its 2014 RFO.
California Energy Commission held a workshop to
discuss the role of bulk storage. PG&E, SCE and
SDG&E announced energy storage procurement
progress under AB 2514. CPUC issued a decision
on Track 1 issues under the Energy Storage
Procurement Framework and Design Program.
CAISO Board of Governors approved changes to
the NGR model under ESDER.
AGC – Automatic generation control; ESDER – Energy Storage and Distributed Energy Resources; MISO – Midcontinent Independent System Operator
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
Federal
The Energy Policy Modernization Act was
brought to the Senate floor. A Battery Energy
Storage Caucus was formed by members of the
U.S. House of Representatives. FERC held a
hearing in November to discuss energy storage;
also issued an order relating to 3rd-party
provision of primary frequency response. U.S.
DOE announced funding under the Grid
Modernization
Initiative.
National
Fire
Protection Association sought comments in
order to synthesize energy storage safety
standards. U.S. Supreme Court upheld FERC
Order 745. Congress extended the tax credits
for renewable energy.
6
Front-of-the-Meter Policy and Market Developments, Q4 2015 (Cont.)
Oregon
Oregon DOE and U.S. DOE awarded
$295,000 under the Electrical Energy
Storage Demonstration Project RFP. Oregon
PUC held a workshop for stakeholder input
on Docket UM 1751.
Vermont
Colorado
Kentucky
PSC Colorado/Xcel Energy submitted two
project proposals under the Innovative
Clean Technologies program.
FERC denied a proposal for a pumped
storage project in Mason County.
Arizona
Texas
APS issued an All-Source RFP to procure
between 400 MW and 600 MW of capacity
resources by 2020.
Austin Energy issued an RFI to solicit
information
on
energy
storage
technology. TCEQ made funds available
under the Texas Emissions Reduction
Plan New Technologies Implementation
Grant program.
Guam
Guam Power Authority is soliciting bids for
up to 40 MW of energy storage.
Vermont Department of Public Service
issued a Comprehensive Energy Plan.
APS – Arizona Public Service; PSC Colorado – Public Service Company of Colorado, a subsidiary of Xcel Energy; TCEQ – Texas Commission on Environmental Quality
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
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Behind-the-Meter Policy and Market Developments, Q4 2015
California
New York
CPUC passed net-metering successor tariff (NEM
2.0); also proposed revisions to SGIP program and
mandated the disbursement of 50% of 2016
program funds before new rules approved. CAISO
announced winners under 2015 DRAM. California
Energy Commission approved EPIC funding grants
for four energy storage companies; also issued a
scoping memo to revise DRP.
NY PSC and NYSERDA authorized the Clean
Energy Fund. NYSERDA and Eos Energy Storage
announced collaboration on Wappingers Falls
Resiliency Project. NY PSC approved Con
Edison‘s amendments on its Commercial
Demand Response Tariff. Con Edison issued a
project implementation plan for its Clean
Virtual Power Plant project under NY REV.
New Jersey
Hawaii
Distributed Energy Resource Council of Hawaii was
formed. HECO filed an Interim Demand Response
Portfolio Program Application; also solicited
comments on Integrated Demand Response Portfolio
Plan and initiated a Commercial Storage Program
with Stem and Energy Excelerator. Hawaii PUC
mandated that HECO refile its TOU proposal.
NJ BPU approved revisions for the Fiscal Year 2016
Renewable Electric Storage Incentive Program.
Colorado
PSC Colorado/Xcel Energy submitted two
project proposals under the Innovative Clean
Technologies program.
DRAM – Demand Response Auction Mechanism; DRP – Distribution Resource Plan; NJ BPU – New Jersey Board of Public Utilities; PSC Colorado - Public Service Company of Colorado, a subsidiary of Xcel Energy
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
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Behind-the-Meter Policy and Market Developments, Q4 2015 (Cont.)
Vermont
Montana
MDU withdrew its residential demand
charge proposal.
Vermont Department of Public Service
issued a Comprehensive Energy Plan.
Green Mountain Power began offering
Tesla Powerwalls for retail customers.
Massachusetts
Nevada
PUCN established new net energy
metering (NEM) rules and introduced
time-of-use rate option under new
NEM structure.
Arizona
TEP filed a rate case with ACC that
would change net-metering rules if
approved. ACC approved APS’ REST
Implementation Plan.
MassCEC issued an RFI under its Microgrid
Grant Program to be followed by an RFP in
the future.
Federal
U.S. DOE announced funding under the
NODES program; also announced funding
under Grid Modernization Initiative and
announced project awards under the
SHINES program. National Fire Protection
Association sought comments in order to
synthesize energy storage safety standards.
U.S. Supreme Court upheld FERC Order 745.
Congress extended the tax credits for
renewable energy.
ACC – Arizona Corporation Commission; APS – Arizona Public Service; PUCN – Public Utilities Commission of Nevada; NODES - Network Optimized Distributed Energy Systems; SHINES – Sustainable and Holistic Integration of Energy Storage and Solar PV; TEP – Tucson Electric Power
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
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U.S. Annual Energy Storage Deployments Will Cross 1 GW in 2019, Reach 1.7 GW by 2020
Energy Storage Deployments by
Segment (MW)
1,800
1,662
1,600
1,400
1,200
1,000
800
600
400
221
200
-
Source: GTM Research
2012
2013
2014
Utility
2015
2016E
Non-Residential
2017E
2018E
2019E
2020E
Residential
• We expect significant growth in the U.S. market over the next five years across all segments, resulting in a 1,662 MW annual market by
2020 – 26 times the size of the 2014 market and 8 times the size of the 2015 market.
• The behind-the-meter segment is expected to account for an ever-larger share of total MW deployed each year through 2020.
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
10
U.S. Energy Storage Market to Reach $2.5 Billion by 2020, Sixfold Growth From 2015
Annual Energy Storage Market Size
(Million $)
$3,000
$2,456
$2,500
$2,000
$1,500
$1,000
$432
$500
$0
2012
2013
Utility
2014
2015
2016E
Non-Residential
2017E
2018E
2019E
Residential
2020E
Source: GTM Research
• The U.S. energy storage market grew from $134 million in 2014 to $432 million in 2015 (up 222%).
• By 2020, the U.S. energy storage market will be worth $2.5 billion, an 18-fold increase from 2014 and a sixfold increase from 2015.
• The utility-scale segment will continue to be the largest segment through 2020, growing from $347 million in 2015 to over $1 billion by
2020. By 2019, the two behind-the-meter segments combined will be large than the utility segment.
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
11
Corporate Investments in Energy Storage Totaled $365 Million in 2015
40
32
$600
30
$400
20
$200
$0
$365
2010
2011
2012
VC
2013
Project Financing
2014
2015
Deal Count
Disclosed Value (Million $)
$800
10
0
Deal Count
• The total disclosed investment in 2014 was boosted by a rumored $250 million investment in Boston-Power (shaded in the figure above).
• In 2015, battery technologies accounted for over 50% of total investment, while software technologies accounted for over 40%.
Note: Data excludes battery materials and upstream companies. 2014 data differs from U.S. Energy Storage Monitor 2014 Year in Review due to exclusion of EV startup Atieva and inclusion of stealth startup Fluidic Energy.
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
12
Renewable Tax Credits Extension
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
Tax Credit Extension Will Spur Further Growth in Renewables and Paired Energy Storage
In December 2015, Congress passed an Omnibus Spending Bill which included a provision for the extension of the Investment Tax Credit
(ITC) for solar and Production Tax Credit (PTC) for wind. Previously the ITC was set to step down at the end of 2016, resulting in a 10% tax
credit for non-residential and third-party owned (TPO) residential systems, and 0% for customer-owned residential systems. Similarly, the
PTC had already expired on January 1, 2015.
With the renewal, the 30% solar ITC will remain active through 2019, stepping down to 26% in 2020 and 22% in 2021; in 2022 the ITC will
step down to the original levels proposed for 2017. A commence-construction clause is included as well, meaning that systems which are
in the process of installation and interconnected by 2023 can still claim the larger tax credits. The 2.3-cent per kWh wind PTC was
retroactively extended for 2015 and also extended by one year. Starting in 2017, the PTC will reduce by 20% (of 2016 value) each year
through 2020. The ITC and PTC extensions will result in greater numbers of solar and wind installations.
If installed alongside solar PV or wind, energy storage systems have historically been able to claim the tax credits. Thus, the tax credit extension
has implications for the energy storage industry as well as the renewables industry, and will affect deployment rates over the coming years.
The full report includes a discussion of the implications of the tax credit extensions on solar-plus-storage economics, as well as the
implications of recent net energy metering reform decisions.
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
14
ITC Extension Has Major Implications for U.S. Solar
U.S. National PV Installed Capacity by Market Segment, Post-ITC Extension
Annual Installations (MWdc)
25,000
20,000
15,000
10,000
5,000
0
2010
2011
2012
2013
Residential
2014
2015E
Non-Residential
2016E
2017E
2018E
2019E
2020E
Utility
Compared to the non-ITC scenario, GTM Research expects a 54% net increase in solar PV installations from 2016-2020, amounting to
an additional 25 GW.
Source: GTM Research Q4 2015 Solar Executive Briefing
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
15
Tax Credit Extension Expected to Spur Further Growth in Storage Paired With Renewables
Annual Storage Deployments Paired With
Renewables Differential (MW)
U.S. Storage Deployment Paired With Renewables Differential Vs. No Extension
200
150
100
50
0
-50
2016E
2017E
Residential
2018E
Non-Residential
2019E
2020E
Utility-Scale
Compared to the non-ITC scenario, GTM Research expects an additional 0.5 GW of storage paired with renewables from 2016-2020, a 33%
increase compared to a scenario with no tax credit extension.
Source: GTM Research
GTM Research/ESA U.S. Energy Storage Monitor: 2015 Year in Review
16
U.S. Energy Storage Monitor
Produced in a collaboration between GTM Research and the Energy Storage Association (ESA), the U.S. Energy Storage Monitor is the industry’s only
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please contact [email protected].
March 2016