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Maine commission: Investor-owned utilities need stronger energy storage cues

As renewable energy sources gain traction in Maine, energy storage could be the key to addressing intermittency issues, according to a recently released state legislative report.

Widespread implementation of energy storage "can eliminate the need to use 'peaker' generation plants (often fossil-fueled plants) to meet peak demand," the commission preparing the report concluded.

However, after studying the economic, environmental and energy benefits of storage, the commission found that a lack of clear regulatory signals in Maine law deters investor-owned utilities, or IOUs, from developing energy storage projects.

"While IOUs understand they can earn revenue from traditional transmission and distribution projects, it is not at all clear when they can earn revenue on energy storage projects and this lack of clarity provides a disincentive for the IOU to look at alternatives to transmission and distribution projects," the report stated.

The commission also said energy storage development in Maine "may be inhibited by market barriers." It suggested that the ISO New England implement clearer rules so energy storage projects are fully valued for their capabilities and can completely participate in the wholesale market.

"In moving forward, Maine does not need to reinvent the wheel," the report said. "There are many other states Maine can look to, especially those in the New England region, for ways in which to encourage storage in a manner that will benefit all ratepayers."

The report continued: "The important thing is that the state needs to start to act quickly so we do not lose pace and fall behind in the New England market."

To that end, the group recommended, among other things, establishing a short-term energy storage capacity development goal of 100 MW by the end of 2025, with additional targets to be proposed in the future as part of an in-depth energy storage study that would provide "a Maine-specific analysis of energy storage costs, benefits and opportunities."

Maine has a 100%-by-2050 renewable energy resources goal, but it already leads New England and ranks sixth nationwide in terms of wind generation, according to Energy Information Administration data compiled November 2019. Data compiled on Sept. 10, 2019, showed that renewable resources already account for the bulk of electricity generated in the state.

The 14-member commission comprised multiple state senators, state representatives and proxies of various stakeholders, including the energy storage industry and conservation organizations.

The report was submitted to the Maine State Legislature on Dec. 30, 2019, and distributed publicly in early January.