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New York drive to lower soft costs of storage by a third funded by NYSERDA

New York in a blackout during Hurricane Sandy. Image: wikimedia commons / David Shankbone.
A drive aimed at reducing the soft costs of distributed energy storage systems by the New York State Energy Research and Development Authority (NYSERDA) could award over US$8 million of funding.

The authority wants to see reductions in non-system and construction costs, such as permitting and financing of 25% per kilowatt-hour by 2019 and 33% or more by around 2021, from a 2015-2016 baseline figure of US$220 per kWh. It has issued a request for proposals (RFP) which technical assistance contractors can download to apply for an award: “RFP3407: Reducing distributed energy storage soft costs”.

Distributed storage systems under the scope of the RFP include behind-the-meter and front-of-meter systems, located within the distribution and sub-transmission systems. NYSERDA has set aside up to US$8.1 million in funding for successful applicants.

As part of New York’s ongoing NY REV (Reforming the Energy Vision) programme, which is an overhaul of the state’s energy system worth as much as US$30 billion in total, energy storage is expected to become an increasingly important component in adding resiliency and flexibility to the network. In June, for example, 12 NY REV demonstration projects were announced, including – at the time – the US’ biggest ‘virtual power plant’, to be built by utility Con Edison, solar PV company SunPower and storage maker Sunverge.

Technology development and trade association group NY BEST told Energy-Storage.News that NY REV could provide "valuable lessons" for the rest of the world in how to update energy networks and properly value energy storage within them. 

Maximising opportunities in New York energy storage market

In the latest RFP, NYSERDA cited a Navigant Research paper which forecast a global distributed energy storage market of 21,000MW installed in 2024 to be worth US$15.6 billion, up from US$675 million in 2014 when the installed base stood at 538MW.  

“NYSERDA seeks to maximise opportunities for firms to provide energy storage solutions to the New York marketplace,” the RFP reads.

NYSERDA believes that as soft costs are often driven by local factors such as fire and building regulations, the authority is well-placed to make an intervention to try and see them reduced. The four categories of soft cost being addressed are:

Energy storage permitting guidance – streamlining processes to provide a clear regulatory path to siting energy storage systems and making sure regulations, codes and standards can be met as the market grows. This would include working with local authorities and energy storage vendors.

Customer acquisition and best fit customer data analytics – determining what kind of sites and customers will be the best economic fit for energy storage, which could include the development of a publicly available web-based tool.

Customer and industry education – information campaigns directed towards targeted audiences within each segment including evaluating which types of building or organisation is likely to have high peaks in their electricity demand.

Data collection and analysis for deployed energy storage systems – checking and analysing data from NYSERDA-supported projects and others in New York, including pilots which seek to assess the effectiveness of “value stacking” i.e. providing multiple services from single systems. Data metrics to be assessed include roundtrip AC system efficiency, kilowatts and kilowatt-hours of available peak reduction, peak demand and energy arbitrage savings.

NYSERDA requires responses to the RFP by 12 December, 5:00pm Eastern Time.

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