In a victory for the energy storage industry, the Connecticut Senate has passed a bill targeting deployment of 1,000 MW of energy storage by December 31, 2030. The bill also establishes interim targets of 300 MW by December 31, 2024 and 650 MW by December 31, 2027. Pursuant to the legislation, the Public Utilities Regulatory Authority (“PURA”) must initiate a proceeding by January 1, 2022, to develop and implement programs and associated funding mechanisms to interconnect energy storage resources with the electric distribution system. The energy storage programs implemented by PURA must include rate design incentives designed to avoid or defer investment in traditional electric distribution system capacity upgrades. Moreover, PURA’s program must achieve the following objectives: 1) provide positive net present value to ratepayers; 2) provide multiple benefits to the grid, including resilience, ancillary services, and leveling peaks in demand; 3) foster sustained, orderly development of state-based energy storage industry; and 4) maximize value from participation of energy storage in capacity markets.
In addition to directives aimed at PURA, the bill also allows the Department of Energy and Environmental Protection (“DEEP”) to issue requests for proposals for energy storage projects connected at the transmission or distribution level, stand-alone energy storage projects, and energy projects paired with Class I renewable energy resources. In evaluating such proposals, DEEP may consider the following factors: 1) whether the proposal is in the best interest of ratepayers, including the delivered price of the resource; 2) whether the proposal promotes electric distribution system reliability, including during winter peak demand; 3) any positive impacts on the State’s economic development; 4) whether the proposal is consistent with greenhouse gas reduction goals; and 5) whether the proposal is consistent with the policy goals of the Comprehensive Energy Strategy and Integrated Resources Plan. Any contract awarded would be subject to PURA review.
If enacted by Governor Lamont, Connecticut will be the eighth state to adopt an energy storage target or mandate.
If you have questions about the bill or are interested in participating in the ensuing regulatory processes, please contact Andrew Kaplan or Kayla Grant.