Date of Award

Spring 5-18-2019

Degree Type

Thesis

First Advisor

Maggie Winslow, Ph.D.

Abstract

This study has been performed to understand the potential impact that the Federal Energy Regulatory Commission’s (FERC) Order No. 841 will have on the adoption of energy storage resources (ESR). This analysis looked at: (1) the Order’s requirements, (2) FERC’s exercise of its authorized jurisdiction within the Order, and (3) actions taken by the Regional Transmission Organizations (RTO), Independent System Operators (ISO) and FERC to demonstrate compliance with the Order’s requirements:

Order No. 841 utilizes a participation model to ensure ESR’s are able to participate in wholesale electricity markets to an extent that is reflective of a resource’s physical and operation characteristics. The model’s effect on market competition will be achieved primarily through a greater realization of merchant value by ESR owners. However, economically optimal levels of ESR capacity and service provision will likely not be achieved through exclusive use of participation models.

Realization of ESR benefits will be heavily dependent on the long-term resilience of the market changes implemented by the Order. FERC’s reliance on a conventional exercise of its jurisdiction over interstate wholesale markets can creating unnecessary regulatory uncertainty, or miss opportunities for State-level engagement to maintain the momentum that Order No. 841 provides to ESR participation.

Key aspects of the RTO/ISO’s compliance plans were tabulated and analyzed. RTO/ISO’s may need to further justify the use of proposed indirect controls to manage ESR physical parameters. Additionally, the widespread use of “dispatch-only” participation models may present participation barriers for some storage technologies.

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