Earth Day 2019: A capacity market first
Every year, ISO New England fields requests from new resources seeking to enter the Forward Capacity Market (FCM). And every year, ISO analysts research those resources to ensure they’ll be able to provide the region with the capacity they’re promising three years in the future. But what happens when a resource is actually 5,000 individual power systems spread out across four New England states?
That was the case entering the 13th Forward Capacity Auction (FCA #13) when Sunrun became the first company to submit plans to participate with an aggregated collection of residential solar plus storage systems. The company was seeking to qualify its 5,000 systems as demand capacity resources, meaning the company would be responsible for reducing demand on the bulk power grid during peak hours in the summer and winter.
During these hours – 1 to 5 p.m. in the summer and 5 to 7 p.m. in the winter – the company proposes to use the solar plus storage devices to power homes in Massachusetts, New Hampshire, Rhode Island, and Vermont, alleviating the need for those homes to use grid power. The solar battery system, called Brightbox, will average five kilowatts, and will be charged by solar panels installed at the homes.
Though the technology and business plan may have been new – and possibly the first of its kind in the country to participate in a capacity market – the fundamental question facing ISO analysts was a simple one: can the company deliver on what it’s promising?
“We used our standard qualification process,” said Jennifer Engelson, an energy data analyst at the ISO who oversaw Sunrun’s application. “As with all resources, we looked at different facets of the project, starting with the project description. We then reviewed financing and customer acquisition plans, the measurement and verification plan, as well as other project characteristics.”
The qualification process was ultimately successful, and Sunrun participated in FCA #13 (held earlier this year in February), securing a 20-megawatt (MW) capacity supply obligation.
Over the next three years, ISO New England will monitor Sunrun’s progress installing its Brightbox solar plus battery systems, to ensure they will be available by June 1, 2022, when the company’s capacity supply obligation kicks in.
Since the first FCM auction in 2008, more than 200,000 MW of new resources have shown at least initial interest in participating in the market, with more than 29,000 MW progressing all the way through the process and securing capacity obligations. These resources have included many different technologies, including natural gas, onshore and offshore wind, solar, and energy efficiency.