f
Charging Forward:
Energy Storage in a
Net Zero Commonwealth
Prepared for MassCEC and DOER
December 2023
 Charging Forward
Energy Storage in a Net Zero Commonwealth
December 2023
Energy and Environmental Economics, Inc. (E3)
One Broadway, Floor 14
Cambridge, MA 02142
415.391.5100
www.ethree.com
Project Team:
Liz Mettetal
Andrew DeBenedictis
Nate Grady
Ruoshui Li
Pedro de Vasconcellos Oporto
Sophia Greszczuk
Charlie Gulian
Kush Patel
Acknowledgements
E3 would like to express our deep appreciation to the organizations and individuals who contributed to
this study. First, we want to thank the stakeholders for their participation in workshops, interviews, and
email exchanges. Their feedback has been critical to the study approach, key findings, and
recommendations. We would also like to thank the members of the Massachusetts Clean Energy Center
and the Massachusetts Department of Energy Resources who served as study partners:
• MassCEC
o Galen Nelson
o Sarah Cullinan
o Corrin Moss
o Ethan Handel
o Rees Sweeney-Taylor*
o Ariel Horowitz*
o Malia Ching*
• DOER
o Joanna Troy
o Samantha Meserve
o Tom Ferguson
o Aurora Edington
o Sarah Basham
*No longer with MassCEC
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Table of Contents
Executive Summary ___________________________________________________________ 1
Key Findings ______________________________________________________________________ 7
Policy Recommendations ___________________________________________________________ 17
Section 1: Study Introduction _______________________________________________ 27
1.1 Role of Stakeholders _________________________________________________________ 28
Section 2: The Role of Energy Storage in the Commonwealth Today ________________ 30
2.1 Energy Storage Deployments Today in the Commonwealth __________________________ 30
2.1.1 Progress Toward Near-term Target and Long-term Goals _________________________ 30
2.1.2 Challenges to Deployment _________________________________________________ 32
2.1.3 Role of Existing Pumped Hydro in the Commonwealth ___________________________ 38
2.1.4 Flexible load and Vehicle-to-Everything as energy storage alternatives ______________ 38
2.2 Existing Policy Landscape in Massachusetts and its Neighbors ________________________ 39
2.2.1 MassSave ConnectedSolutions ______________________________________________ 40
2.2.2 Clean Peak Energy Standard ________________________________________________ 42
2.2.3 SMART _________________________________________________________________ 44
2.2.4 Net Energy Metering ______________________________________________________ 46
2.2.5 Policies of Note in Neighboring States ________________________________________ 46
2.2.6 Implications of the Inflation Reduction Act ____________________________________ 47
2.3 The Business Case for Short-duration Energy Storage _______________________________ 48
2.3.1 Storage Use Cases ________________________________________________________ 49
2.3.2 Benefits of Short-duration Energy Storage _____________________________________ 51
2.3.3 Costs of Short-Duration Energy Storage _______________________________________ 55
2.3.4 Use Case Examples _______________________________________________________ 56
2.3.5 Societal Impacts _________________________________________________________ 72
2.3.6 Ratepayer Impacts _______________________________________________________ 75
Section 3: Mid- and Long-Duration Storage Technology and Cost Outlook ___________ 77
3.1 Potential Electric Grid Value from Mid- and Long-Duration Storage____________________ 77
3.2 Candidate Technologies Overview ______________________________________________ 79
3.3 Mid- and Long-Duration Storage Costs ___________________________________________ 81
3.4 Markets for Monetizing Storage Value ___________________________________________ 82
3.4.1 Market Structures Required to Support Mid- and Long-Duration Storage ____________ 83
3.4.2 Innovation Gap and the Role of the Commonwealth _____________________________ 83
3.5 Mid- and Long-duration Storage Applications for End Users __________________________ 85
3.5.1 Critical Facility or Microgrid Backup __________________________________________ 85
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 3.5.2 Backup Power for Disadvantaged Communities _________________________________ 86
3.5.3 Electric Vehicle Fleet Charging ______________________________________________ 87
Section 4: The Role of Storage in Supporting Electric Grid Resource Adequacy in
Massachusetts ______________________________________________________________ 89
4.1 Context: Electric System Reliability and the Potential Role of Storage __________________ 89
4.1.1 Defining Reliability and Resource Adequacy ____________________________________ 89
4.1.2 Measuring Resource Adequacy Contributions of Storage using Effective Load Carrying
Capacity _______________________________________________________________________ 91
4.2 Scenario Design _____________________________________________________________ 94
4.3 Modeling Approach __________________________________________________________ 95
4.4 Inputs and Assumptions ______________________________________________________ 96
4.4.1 Electricity Demand _______________________________________________________ 96
4.4.2 Resource Portfolios _______________________________________________________ 99
4.4.3 Load and Renewable Profiles ______________________________________________ 101
4.5 Results: The Reliability Challenge in 2030 and 2050 _______________________________ 106
4.5.1 New England Grid in 2030 _________________________________________________ 106
4.5.2 New England Grid in 2050 _________________________________________________ 108
4.6 Results: Short-Duration Storage Effective Capacity ________________________________ 112
4.7 Results: Mid-Duration Storage Effective Capacity _________________________________ 114
4.8 Results: Long Duration Storage Effective Capacity _________________________________ 116
4.9 Diversity Benefits ___________________________________________________________ 119
4.10 LDES Replacement for Grid “Perfect” Capacity __________________________________ 121
4.11 100% Renewables Plus Storage Scenario ______________________________________ 122
4.12 Storage Impact on Curtailment and Emissions __________________________________ 123
4.13 Results: Reliability Risk Under Key Sensitivities _________________________________ 125
Section 5: High Level Takeaways and Recommendations ________________________ 128
Appendix A. Summary of Stakeholder Involvement ______________________________ 130
A.1 Key Use Cases and Revenue Streams ___________________________________________ 130
A.2 Existing State Programs ______________________________________________________ 131
A.3 Barriers to Deployment ______________________________________________________ 132
A.4 Mid- and Long-Duration Energy Storage_________________________________________ 136
A.5 Study Approach ____________________________________________________________ 136
Appendix B. Storage Incentive Policies in Neighboring States ______________________ 137
B.1 Energy Storage Solutions (CT) _________________________________________________ 137
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 B.2 Green Mountain Power incentives (VT) _________________________________________ 138
B.3 Market Acceleration Bridge Incentive (NY) ______________________________________ 140
B.4 Value of Distributed Energy Resources Compensation (NY) _________________________ 142
B.5 Index Storage Credit Program (NY, proposed) ____________________________________ 143
Appendix C. Short Duration Use Case Annual Revenue Streams ____________________ 144
Appendix D. Mid- and Long-duration storage candidate technologies _______________ 147
Appendix E. Modeling Tools & Additional Results _______________________________ 149
E.1 Additional Information on RECAP ______________________________________________ 149
E.2 Effective Load Carrying Capability Calculation ____________________________________ 151
E.3 Reliability Characterization of 2040 New England System __________________________ 152
E.4 Diversity Benefit between SDES and Solar _______________________________________ 153
E.5 24-hour Duration LDES ELCC Results ____________________________________________ 154
E.6 Representative Dispatch Charts for Sensitivity Cases ______________________________ 156
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Figures
Figure ES-1. Energy Storage Provides Multiple Potential Benefits on Path from Electricity Generation to
Customers ..................................................................................................................................................... 2
Figure ES-2. Example of Energy Storage Grid Services ................................................................................. 2
Figure ES-3. Battery Costs from 2013-2022 .................................................................................................. 4
Figure ES-4. U.S. and Massachusetts Storage Capacity and Deployments Over the Last Decade ............... 4
Figure ES-5. Energy Storage Deployments and the ISO-NE Interconnection Queue .................................... 5
Figure ES-6. Estimated Lifetime Societal Net Benefits Across Installation Years ......................................... 8
Figure ES-7. Summary of Short- and Mid-Duration Use Case Results for 2024 Install Year – Developer
Perspective.................................................................................................................................................... 9
Figure ES-8. Projected Annual Revenues for a 4-hour Standalone, Transmission-connected Resource –
Developer Perspective .................................................................................................................................. 9
Figure ES-9. Storage Cost Expectations over Time ..................................................................................... 11
Figure ES-10. Eversource and National Grid historical outages (2019-2022) by circuit ............................. 12
Figure ES-11. Examples of Storage Dispatch During Critical Periods in 2030 and 2050 ............................. 13
Figure ES-12. Length of System Resource Needs Before Firm and Energy Storage Dispatch .................... 14
Figure ES-13. 100-Hour Storage Incremental ELCC..................................................................................... 15
Figure ES-14. LDES as an Alternative to Support System Reliability in 2030 and 2050 .............................. 16
Figure 1-1. Role of Storage in CECP’s Decarbonized Electric Grid .............................................................. 27
Figure 2-1. Operating Storage Capacity (MW), Exclusive of Pumped Hydro .............................................. 31
Figure 2-2. Overview of Proposed Energy Storage in the ISO-NE Interconnection Queue ........................ 32
Figure 2-3. Commodity Price Index for Common Battery Storage Raw Materials ..................................... 33
Figure 2-4. Clean Peak Energy Standard peak definitions .......................................................................... 43
Figure 2-5. Illustrative ITC Credit Levels Under the IRA .............................................................................. 48
Figure 2-6. Energy storage values at different grid scales .......................................................................... 49
Figure 2-7. Daily differentials between highest and lowest price hours .................................................... 52
Figure 2-8. AESC grid emissions factors by season and hour...................................................................... 54
Figure 2-9. Pro Forma framework ............................................................................................................... 55
Figure 2-10. Short-Duration Storage Cost Forecasts .................................................................................. 56
Figure 2-11. Developer Net Benefits Across Installation Years .................................................................. 58
Figure 2-12. FTM Tx Connected Benefits and Cost Stack – Developer Perspective ................................... 59
Figure 2-13. FTM Tx Connected Annual Revenues – Developer Perspective ............................................. 59
Figure 2-14. Example of a 2024 summer week – Clean Peak Credits drive dispatch behavior .................. 60
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Figure 2-15. Example of a 2040 summer week – renewable generation drives price spreads .................. 61
Figure 2-16. FTM Distribution Connected Benefits and Cost Stack – Developer Perspective .................... 63
Figure 2-17. FTM Solar Paired Benefits and Cost Stack – Developer Perspective ...................................... 65
Figure 2-18. FTM Solar-paired storage dispatch (example week in June) .................................................. 66
Figure 2-19. C&I BTM solar-paired storage benefits and cost stack – developer perspective ................... 67
Figure 2-20. C&I BTM solar-paired storage dispatch (example week in June) ........................................... 68
Figure 2-21. Residential BTM solar-paired storage benefits and costs – developer perspective .............. 69
Figure 2-22. Residential BTM solar-paired storage dispatch (example week in June) ............................... 70
Figure 2-23. Mid-duration, Grid-Scale, FTM Standalone Benefits and Cost Stack – Developer Perspective
.................................................................................................................................................................... 71
Figure 2-24. 8-hour, Grid-Scale, FTM Standalone Annual Revenues – Developer Perspective .................. 72
Figure 2-25. Societal Benefit and Cost Stacks for Use Cases – 2024 Installation Year ............................... 73
Figure 2-26. Societal Net Benefits Across Installation Years ...................................................................... 74
Figure 2-27. Ratepayer Benefit and Cost Stacks for Use Cases – 2024 Installation Year ........................... 75
Figure 2-28. Ratepayer Net Benefits Across Installation Years................................................................... 76
Figure 3-1. Mid- and Long-Duration Storage Cost Forecast ....................................................................... 82
Figure 3-2. Utility-Scale Energy Storage Projects ........................................................................................ 84
Figure 3-3. Eversource and National Grid Historical Outages (2019-2022) by Circuit................................ 86
Figure 4-1. Major Elements of Reliability Planning ..................................................................................... 90
Figure 4-2. Illustration of Declining ELCC for 8-hour Energy Storage as Function of Penetration ............. 92
Figure 4-3. Illustration of Diversity Benefit Between Solar and SDES Resources ....................................... 93
Figure 4-4. Illustration of Diversity Benefit between LDES and OSW Resources ....................................... 93
Figure 4-5. Overview of E3’s RECAP Model ................................................................................................ 95
Figure 4-6. New England and Massachusetts Load Forecast, based on CECP 2050 (2011 Weather) ........ 97
Figure 4-7. New England and Massachusetts Peak Load Forecast, based on CECP 2050 (2011 Weather) 98
Figure 4-8. Variation in Expected Gross Peak Load Across 40 Years of Weather Conditions ..................... 99
Figure 4-9. CECP 2050 Resource Portfolio, with Adjustments* ................................................................ 100
Figure 4-10. Overview of Key Load and Renewable Data Sources Statistical techniques used to extend
renewable data back to 1980 ................................................................................................................... 102
Figure 4-11. Month-Hour Average Electric Heating Loads, 2030 ............................................................. 102
Figure 4-12. Month-Hour Average Total Loads in New England, 2030 .................................................... 103
Figure 4-13. Month-Hour Average Total Loads in New England, 2050 .................................................... 103
Figure 4-14. Cold Snaps Captured in Extended Weather Year Simulation ............................................... 104
Figure 4-15. Utility-scale Solar Month-hour Average Capacity Factor ..................................................... 105
Figure 4-16. Wind Month-hour Average Capacity Factor ......................................................................... 105
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