Batteries are often touted as technology that will help solve the climate change problem. In some cases, direct emission reductions do occur with their use – battery-powered electric vehicles (EVs), for example, in comparison to internal combustion engine (ICE) vehicles, do not produce any tailpipe GHGs. The answer for EVs vs ICEs becomes more complicated when we start broadening the life cycle and look at where the electricity for EVs is sourced from – a coal plant and a solar array have vastly different emissions profiles.
When it comes to electrical grids and their use of storage and whether the use of storage reduces GHG emissions, the answer is even more complicated! Brightspot Climate recently conducted research on jurisdictions in North America leading the way on energy storage and renewables integration. What we found is that even in the most progressive jurisdiction – California – an incentive program to increase energy storage adoption resulted in GHG emissions increases!*
The culprit? Improper rate-setting, and competitive electricity production rates.
In California, electricity production is somewhat at par between fossil fuel and renewable installations. Energy storage should thus have been incentivized to only charge when renewable installations were producing, and discharge when fossil fuel installations were producing. However, because of the very close proximity in pricing between the two generation types, storage operators were finding that the rates paid to them by utilities to incentivize charging (an example of a time-of-use or TOU rate) were sometimes timed with fossil fuel generation. The problem? GHGs were not accurately measured or accounted for in these rates.
In December 2018, in response to this issue, the California Public Utilities Commission (CPUC) proposed the inclusion into utility TOU rates of a digitally accessible real-time marginal GHG signal based on 5-minute intervals.
It remains to be seen if California’s revision will be successful in reducing their GHGs according to their targets.
*It’s important to note that our research did not encompass imports and exports of electricity.