On May 16, 2016, a panel discussion titled "Electricity
Storage – A Game-Changer for Utilities" was presented at
the 2016 CAMPUT conference in Montreal. As we
discussed in an earlier
post, energy storage has been referred to by many commentators
as a "game changer" because it will greatly improve the
efficient use of electricity resources (generation, transmission,
distribution), while at the same time bring challenges for the
electricity grid and the role of local distribution companies.
These themes were addressed by the CAMPUT panel on this topic. As
set out in the CAMPUT program materials, one focus of the
presentation was about how electricity storage could significantly
change the wires portion of a utility's business and provide
opportunities for electric utilities to evolve their traditional
From an energy regulation perspective, two of the interesting
subjects of discussion were around current barriers to the growth
of energy storage and about how distributors can maintain viability
when dealing with large numbers of customers using less electricity
from the distributor.
A key issue with energy storage is that it can play several
roles, yet that is not something that is encouraged by regulation
(which favours non-integrated offerings). Indeed, as explained by a
couple of the CAMPUT panelists, finding ways to allow storage to
play multiple roles is necessary in order to make an economic case
for investing in more energy storage. Examples are seen in the fact
that an owner or operator of a storage facility (especially one
connected to a generation facility) will likely want to act as a
generator, distributor, retailer and consumer of electricity. There
are currently barriers in some jurisdictions around parties acting
in these multiple roles. These barriers need to be addressed in
order to properly "unlock" the value and prospects for
energy storage. As the CAMPUT panelists explained, addressing these
issues and facilitating the growth of energy storage will add to
grid resiliency, customer choice and environmental attributes.
Another topic of discussion was about the impact of energy
storage on current distribution services. The CAMPUT panelists
agreed that while there may be little customer appetite for
completely disconnecting from the grid, there is a strong interest
for more customer choice for options that are less reliant on
distributor-supplied electricity. This will include
behind-the-meter energy management systems, perhaps in conjunction
with distributed generation and geothermal solutions. Of course,
this raises the question about how distributors will collect their
costs and be compensated when their customers are consuming less.
The CAMPUT panelists did not have any consensus about solutions for
this issue, though they clearly identified it as something to be
addressed. A number of possible approaches were discussed,
addressing how new technologies can be encouraged at the same time
as maintaining the viability of the electricity distribution
sector. As we have previously discussed (see
here), this topic is currently being considered by the Ontario
Energy Board (OEB). The OEB's solution for residential
customers is to move to fully fixed (non-volumetric) distribution
rates, in part so that the distributor is not harmed by
self-generation, net metering and electricity storage. It is not
yet clear how the OEB will evolve distribution rates for larger
customers, including whether there will be a generally available
At the end of the presentation, the CAMPUT panelists were asked
if energy storage is a "game changer" for utilities. The
consensus seems to be that while energy storage is important, it is
not a "game changer" on its own. However, in combination
with other new technologies (including unregulated behind-the-meter
renewable generation), there will be greatly enhanced customer
choice, which may be a "game changer."
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Canada is a constitutional monarchy, a parliamentary democracy and a federation comprised of ten provinces and three territories. Canada's judiciary is independent of the legislative and executive branches of Government.
The Government of Alberta recently announced a number of policy changes that will impact the Alberta Electricity Market, composed of its generators, transmitters, distributors, retailers, electricity consumers and wholesale electricity market.
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