Storage Plus Renewables Power Purchase Agreement Prices Are Expected to Fall as Adoption Expands
Accurate valuing and positioning of storage plus renewables by utilities will continue to drive the North American market
A new report from Navigant Research tracks the North American market for utility-scale storage plus renewables (storage-plus) adoption and power purchase agreement (PPA) prices.
The utility-scale energy storage market has grown steadily since 2011 as the technology risk and cost associated with energy storage systems decreased rapidly. Today, energy storage is being developed in tandem with renewable resources at prices that compete with combined cycle gas plants. Click to tweet: According to a new report from @NavigantRSRCH, storage-plus PPA prices are expected to continue to fall as adoption of this technology expands.
“In 2018, storage-plus made its first shift from the validation and first-mover adopters to diffuse adoption led by utilities,” says Alex Eller, senior research analyst with Navigant Research. “The accurate valuing and positioning of storage-plus by utilities will continue to drive the market in coming years as storage-plus PPAs are already competitive with the levelized cost of energy for combined cycle natural gas in parts of the US.”
According to the report, regulators and utilities must push for all-resource solicitations to take advantage of this price disruption and meet aggressive renewable portfolio standard targets in the process. Utilities must invest in sophisticated modeling tools to measure the value of storage-plus to the grid. In parallel, regulators should continue to foster supportive environments for utilities to innovate, such as valuing non-economic benefits of storage-plus, such as water intensity.
The report, How Utilities Can Look Beyond Natural Gas with Cost-Effective Solar Plus Storage Strategies, tracks the North American market for utility-scale storage-plus adoption and PPA prices. The study provides recommendations for utilities and regulators globally to take advantage of storage-plus plants to meet flexibility, reliability, and renewables targets using all-resource solicitations. The report provides estimates of market trends into 2021. It also examines a variety of market trends and use cases around the globe. An Executive Summary of the report is available for free download on the Navigant Research website.
* The information contained in this press release concerning the report, How Utilities Can Look Beyond Natural Gas with Cost-Effective Solar Plus Storage Strategies, is a summary and reflects Navigant Research’s current expectations based on market data and trend analysis. Market predictions and expectations are inherently uncertain and actual results may differ materially from those contained in this press release or the report. Please refer to the full report for a complete understanding of the assumptions underlying the report’s conclusions and the methodologies used to create the report. Neither Navigant Research nor Navigant undertakes any obligation to update any of the information contained in this press release or the report.