July 2, 2021

Connecticut Regulator Issues Draft Order on 580 MW Energy Storage Program, Following Deployment Target Legislation

The Connecticut Public Utilities Regulatory Authority (PURA) issued a draft order on 7/1 that would approve a 580 MW energy storage program for customer-sited energy storage systems. The Order closely resembles the straw proposal issued by PURA on 1/26, with several changes to strengthen the program incentives for commercial and industrial (C&I) projects, making certain projects eligible for participation in ISO NE capacity markets, and addressing front-of-the-meter (FTM) projects. The draft order follows recent enactment of legislation establishing a 1 GW by 2030 energy storage target that includes statutory direction for the program.
Significant changes from the straw proposal are consistent with previous ESA recommendations and include the following:
  • FTM program: PURA directs the Connecticut Green Bank to propose a recommended path forward for FTM incentives by 8/1/22. PURA also directs utilities to immediately reform demand charges with a revenue-neutral tariff rider to be effective 1/1/22.
  • Capacity Market Participation: Storage owners or operators are still required to transfer rights to participate in capacity markets to the Connecticut Green Bank as the default option, but may request to retain capacity rights for projects that serve customers on the grid edge, critical facilities, C&I customers with existing fossil fuel generators, and small business customers.
  • Passive dispatch: Storage systems that receive an upfront incentive must be set to passive dispatch settings, as in the Straw Proposal. However, those settings may be overridden in order to meet ISO-NE market obligations.
  • C&I incentives: C&I incentives are capped at 50% of system cost, instead of $7,500 in the straw proposal. Incentives levels are set at the proposed $280/installed kWh for small commercial customers, and reduced to $250/installed kWh for large commercial customers and $225/installed kWh for industrial customers. A single capacity block of 50MW was set for C&I for the first 3 years of the program, rather than a declining block incentive.
  • Round-trip efficiency: PURA kept the requirement from the straw proposal of a minimum 80% round-trip efficiency
Written exceptions are due 7/16, with a final decision set for 7/28. ESA looks forward to bringing its multi-year engagement on behalf of the storage industry in Connecticut to a successful conclusion with finalization of this program.
Read the Draft Order

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