The Importance of Battery Storage in Energy Transition

In the next 5 years, the US will be facing resource adequacy challenges due to a combination of high demand growth, thermal generator retirements, not enough energy storage, and generator interconnection delays. The “not enough energy storage” issue appears because the energy transition is replacing base load generation (high-capacity credit) with variable #renewableenergy (VRE) resources (low-capacity credit). Solar and #windenergy assets need to be combined with energy storage to approach the capacity credit (CC) of the thermal resources being replaced. Capacity credits capture what fraction of a resource’s nameplate capacity can be expected to contribute to meeting demand during peak periods. In November 2024, NREL published a report on CC values of #renewableenergy and #energystorage. The 1st figure below shows average CC’s across technologies from 2026 to 2050. Between regions and scenarios, CC’s differ widely, but still, this is instructive. #Solar CC’s are low and decline as penetration rates increase, which drives a gradual shift of peak net load hours to hours with little solar generation. The wind CCs over time are explained by a combination of project development cycles and penetration levels. Energy storage CC’s are high, and 4-hour #battery capacity credits range between 66% and 100%. The 2nd figure is from FERC’s 2023 Market Report and shows the nameplate capacity net additions & retirements from 2013 to 2023 by resource type. Zooming in on MISO, note that resource additions will only cover retirements if they have similar capacity credit (they don’t), and negligible #energystorage was added. A back of the envelope calculation demonstrates why NERC’s Reliability Assessment (Dec 2024) has characterized MISO as “High Risk” to fall below established resource adequacy criteria. Assumptions were made to simplify this math (MISO’s accreditation for resources is highly seasonal, controversial, and in flux). Remove 26 GW of coal (85% CC) and 2 GW of nuclear (95% CC) means MISO was down 24 GW over the period. Add 17 GW of wind (22% CC), 8 GW solar (25% CC), and 2 GW Nat Gas (80% CC), and this adds back 7.3 GW. This is a net loss of over 16.5 GW of “real” capacity. Obviously, this is not sustainable, especially considering the 9 GW of load growth expected in MISO by 2029 (Grid Strategies). Similar scenarios are playing out across other markets in the US. Delaying thermal retirements is the current answer, but retirements typically happen when assets are no longer economically running. If they suddenly become economic, it probably means they are getting paid more (i.e. electricity prices will rise). This also means #sustainability progress goes in reverse. A better solution is to fix IX processes, carefully plan for load growth, and add more energy storage along with VRE’s. Indeed, the NREL report shows the average CC of 4-hour #energy storage stays above 70% at penetration levels past 50% of peak load. References in comments.

🔋 🤔 "Batteries aren't dispatchable?" Think again, Texas! The Texas Senate recently passed SB 388—a bill that excludes battery storage as a dispatchable resource in their new 'dispatchable' power credits trading program. This, despite battery storage meeting their own definition of a dispatchable resource… If enacted, this would force renewable energy developers to effectively subsidize traditional generation, like natural gas, despite battery systems already delivering fast, flexible support to the ERCOT grid. ⚠️ Battery storage undeniably qualifies: ✅ Bi-directional capabilities ✅ Millisecond response to demand surges or excess generation ✅ Provides frequency regulation, voltage support, and rapid ramping ✅ Already saving costs by reducing reliance on expensive peaker plants If the goal is grid reliability, why constrain Texas' capacity despite growing energy demands? 👉 Texas' energy needs are accelerating, especially as the state becomes a hub for AI and data center growth 👉 Supply chain delays are slowing the rollout of new natural gas plants—making additional flexible capacity even more critical. Excluding storage not only limits options—it ignores how the grid already operates: 👉 Battery storage provides essential grid services like frequency regulation, voltage support, and fast ramping. 👉 It already contributed to significant grid cost savings by avoiding expensive peaker plants and enhancing efficiency. SB 388 now heads to the House. As Texas prepares for a more demanding energy future, policy should reflect market needs and asset performance, not pick favorites. Reliability depends on including all technologies that keep the grid stable—especially those that are already doing the job. Please like, comment, or repost if you disagree with this backwards legislation... 💭👇 #energystorage #ESS #batteries #ERCOT #SB388

🔋 𝗪𝗵𝘆 𝗟𝗮𝗿𝗴𝗲-𝗦𝗰𝗮𝗹𝗲 𝗘𝗻𝗲𝗿𝗴𝘆 𝗦𝘁𝗼𝗿𝗮𝗴𝗲 𝗶𝘀 𝘁𝗵𝗲 𝗕𝗮𝗰𝗸𝗯𝗼𝗻𝗲 𝗼𝗳 𝗮 𝗦𝘁𝗮𝗯𝗹𝗲 𝗚𝗿𝗶𝗱 As temperatures rise and energy demand surges, the strain on our power grids is becoming more intense—and more visible. Traditional systems were never built to handle this kind of volatility. That’s where 𝗹𝗮𝗿𝗴𝗲-𝘀𝗰𝗮𝗹𝗲 𝗲𝗻𝗲𝗿𝗴𝘆 𝘀𝘁𝗼𝗿𝗮𝗴𝗲 steps in. ⚡ 𝗦𝘁𝗼𝗿𝗮𝗴𝗲 𝗶𝘀𝗻’𝘁 𝗷𝘂𝘀𝘁 𝗮 𝗯𝗮𝗰𝗸𝘂𝗽. 𝗜𝘁’𝘀 𝗮 𝘀𝘁𝗮𝗯𝗶𝗹𝗶𝘇𝗲𝗿. By absorbing excess energy when supply is high and discharging it when demand peaks, storage helps to: • Flatten demand spikes • Reduce reliance on fossil-fuel peaker plants • Enhance grid resilience during extreme weather • Support the seamless integration of renewables 📈 In other words, storage transforms the grid from a rigid, one-way system into a 𝗳𝗹𝗲𝘅𝗶𝗯𝗹𝗲, 𝗱𝘆𝗻𝗮𝗺𝗶𝗰 𝗻𝗲𝘁𝘄𝗼𝗿𝗸 capable of adapting in real time. This isn’t just an engineering solution—it’s a strategic imperative. Utilities, regulators, and investors must treat storage not as a luxury but as 𝗰𝗿𝗶𝘁𝗶𝗰𝗮𝗹 𝗶𝗻𝗳𝗿𝗮𝘀𝘁𝗿𝘂𝗰𝘁𝘂𝗿𝗲 in the clean energy transition. 💡 The future of the grid isn’t just about generation. It’s about 𝗵𝗼𝘄 𝗮𝗻𝗱 𝘄𝗵𝗲𝗻 we use what we’ve generated. #EnergyStorage #GridStability #CleanEnergy #Utilities #SmartGrid #Renewables #PeakDemand #EnergyTransition