August 9, 2018Michael Hollingsworth Named to FLOCK Specialty Finance Advisory Council
October 30, 2017
Proposed NOPR on Grid Resilience Draws National Attention: More than 300 comments were submitted last week at the Federal Energy Regulatory Commission (FERC) in response to the Department of Energy’s Notice of Proposed Rulemaking on Grid Resilience. The comments came from a wide variety of industry stakeholders, ranging from individual citizens to industry trade groups and members of Congress. The proposed rule is aimed at ensuring compensation for generation resources that provide grid resiliency services, however it has been widely opposed and framed as a massive and unnecessary subsidy for coal and nuclear resources that are no longer economically viable. Notably, the RTO/ISO Council – the group of the nation’s wholesale grid operators that deliver power to approximately 2/3 of Americans – stated in its comments that the Proposed Rule “would degrade the efficiency and effectiveness of existing organized wholesale markets, would provide improper incentives and disincentives to current and future market participants, would not promote the goals stated in the [Proposed Rule] (i.e., enhancement of electric reliability and resilience), and would reverse the progress [FERC] and the nation’s regional transmission organizations (“RTO”) and independent system operators (“ISO”) have made in developing robust and reliable competitive markets.” Reply comments to the Proposed Rule are due on November 7, 2017, and action on the Proposed Rule is expected from FERC by the end 2017.
Generate Capital Raises $200 million: Generate Capital, a San Francisco-based fund focused on investments in sustainable infrastructure, announced on October 24, 2017 that it has raised $200 million in equity funding to provide capital for energy, water and food infrastructure assets. The Alaska Permanent Fund Corporation, one of the largest sovereign wealth funds in the U.S. that has been created largely by oil revenues and valued at $62 billion, led the round.
PJM Proposes Reforms to Regulation Market: On October 17, 2017, PJM Interconnection, LLC (PJM) proposed changes to the compensation structure of its Regulation market, which to date has served as a major source of revenue for grid-scale battery storage resources. The market compensation changes follow operational changes PJM made to the Regulation market in January 2017, which prompted complaints being filed at the Federal Energy Regulatory Commission by the Energy Storage Association and several companies with large battery storage fleets. While PJM’s position is that the proposed changes to the compensation structure are necessary to properly align market incentives for all resources providing Regulation services, the measures are expected to be heavily opposed by battery storage interests, as the changes are expected to reduce revenue opportunities for battery storage resources in PJM. Comments to PJM’s proposed changes are due November 7, 2017.
California Governor Brown Signs Bill Directing Utilities to Plan Storage, DERs For Peak Demand: On October 11, 2017, California Governor Jerry Brown signed a bill that will make California utilities legally obligated to plan for how carbon-free resources can help combat the solar "duck curve." California receives plenty of solar generation during the day, followed by a steep increase in evening power demand nicknamed the "duck curve" for the shape of its load chart. The evening peak demand has typically been met by natural gas fired plants, which while necessary for meeting power demand, impedes California utilities’ obligation to cut carbon emissions 40% below 1990 levels by 2030. In order to meet the goals of lower emissions and a reliable grid, the bill requires utilities to alter their Integrated Resource Plan IRP processes to evaluate "the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency" to meet the hours of peak demand. The bill, and California utilities’ modified IRP processes, are poised to open additional opportunities for storage investment and project developments.
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