BILL NUMBER: S8602A

SPONSOR: GRIFFO
 
TITLE OF BILL:

An act to amend the public service law, in relation to establishing the
energy storage deployment policy

 
PURPOSE:

To promote the installation of qualified energy storage systems through
the energy storage deployment program.

 
SUMMARY OF PROVISIONS:

By December 31, 2018, the Public Service Commission (PSC) is required to
establish by order, rules and regulations a 2030 energy storage goal for
the state and a deployment policy for such goal.

This legislation would require the PSC to develop the goal and the poli-
cy through consultation with the New York State Energy Research and
              

Development Authority and the federally designated electric bulk system
operator for New York State (the New York Independent System Operator,
Inc., which is responsible for maintaining and enhancing regional elec-
tric system reliability, operating open, fair and competitive wholesale
electricity markets, and planning the power system).

This legislation also would require that the energy storage deployment
policy provide that, to the extent that it directs the procurement of,
or any payments to, qualified energy storage systems to encourage their
deployment, such procurements shall be awarded through a competitive
process.

 
JUSTIFICATION:

Energy storage systems can efficiently solve the issues related to the
timing mismatch between energy supply and demand. In fact, by absorbing
and storing energy resources, storage systems are able to reduce demand
for peak hours, boosting the resilience and reliability of the electric
grid. This way, renewable energy can be available continuously.

Chapter 415 of the Laws of 2017 (and related legislation this year)
defines qualified energy storage systems and provides a regulatory
framework for the PSC to start the energy storage deployment program.
This program will encourage the installation of such systems throughout
New York State, leading to a more efficient and sustainable use of
renewable energy sources.

In his 2018 Briefing Books on the State of the State Address and on his
Executive Budget, Governor Andrew M. Cuomo called for the launch of an
energy storage initiative to deploy 1,500 megawatts of energy storage by
2025. The State of the State Briefing Book indicates that:  "To achieve
this goal and build on the recently signed Energy Storage Deployment
legislation (A.6571 of 2017), Governor Cuomo is directing state energy
agencies and authorities to work together during 2018 to generate a
pipeline of storage projects through utility procurements, to advance
regulatory changes in utility rates and wholesale energy markets, to
incorporate storage into criteria for large scale renewable procure-

ments, and, to reduce regulatory barriers." This legislation is consist-
ent with the Governor's statement.

This bill ensures that the 2030 energy storage goal is met in a cost-ef-
fective manner. The energy storage deployment policy would minimize
costs to electricity consumers by requiring that, to the extent that the
policy directs the procurement of, or any payments to, qualified energy
storage systems to encourage their deployment, such procurements shall
be awarded through a competitive process. To the extent that the energy
storage deployment policy requires electricity consumers to pay, direct-
ly or indirectly, the costs of qualified energy storage systems or any
products or services they produce, including any associated environ-
mental attributes, the energy storage deployment policy should encourage
the broad participation of developers and owners of qualified energy
storage systems to deploy such systems through competitive and/or other
processes that minimize costs to electricity consumers to the maximum
extent possible. A competitive process for the procurement of energy
storage systems and their related products and services allows competi-
tion among independent providers of energy storage services to produce
the most efficient and least cost outcome for energy consumers. Other
processes could include rebates, demand response payments, and tariff
structures for non-wires alternatives, by which the PSC already is seek-
ing to minimize consumer costs.

The energy storage deployment policy also should be implemented in a
manner consistent with the PSC's decisions on the Reforming the Energy
Vision (REV) and Clean Energy Standard proceedings, in order to assure
the most efficient and least cost outcome for energy consumers. In its
Order in the REV proceeding, the PSC determined that "unrestricted util-
ity participation in DER (distributed energy resource) markets presents
a risk of undermining markets more than a potential for accelerating
market growth." Therefore, utility ownership of energy storage is limit-
ed only to projects consisting of energy storage integrated into
distribution system architecture.  Going forward, in order to provide
least cost outcomes for energy consumers and to accelerate market
growth, energy storage projects should be developed and owned only by
independent providers of energy storage services selected through a
competitive or other process that ensures lowest cost to electricity
consumers.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

None Noted.

 
EFFECTIVE DATE:
This act shall take effect on the same date and in the same manner as a
chapter of the laws of 2018 amending the public service law and the
public authorities law relating to establishing the energy storage
deployment policy, as proposed in legislative bill numbers S. 7318a and
A. 8921a, takes effect.