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Additions in U.S. grid-scale energy storage during the first three months of the year outpaced the same period last year four times over, with a record 2,399 MWh brought online despite supply chain-related delays. 

A recent report by consultancy Wood Mackenzie and the American Clean Power Association (ACP) found that residential, nonresidential and grid-scale storage reached record installations in 1Q2022.

The first quarter of 2022 “was the largest first quarter on record by far for grid-scale installations, a notable milestone since installations are typically back-weighted to the second half of the year,” said Wood Mackenzie’s Vanessa Witte, senior analyst with the energy storage team.

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California dominated, according to Witte. In February, Terra-Gen LLC brought online the Valley Center battery energy storage project in Southern California, adding 139 MW to the grid. 

Goldman Sachs Group Inc. affiliate Goldman Sachs Renewable Power in March ramped up its Slate solar generation and storage project in Kings County, CA. Slate consists of 390 MW solar capacity combined with 561 MWh of storage. 

Several states, though, including California, have warned they do not have the solar panel supply needed to continue to increase capacity. They have cited the U.S. Department of Commerce’s investigation into whether solar imports from Cambodia, Malaysia, Thailand and Vietnam are from China, which could be sending parts through these countries to avoid taxes. 

The investigation reduced projections for hybrid projects in 2022, according to Wood Mackenzie. However, a Biden administration order to pause solar tariffs on those countries for two years could ease the slump. 

The decision to pause “solar tariffs for two years restores predictability to both the solar and energy storage markets,” said ACP’s John Hensley, vice president of research and analytics.

With more than 50% of utility storage projects now paired with solar farms, “this important executive action will help the energy storage market continue to accelerate,” Hensley said.

The Energy Information Administration (EIA) reported that at the end of 2020, 30% of large-scale battery storage systems were co-located with generation from wind or solar. 

Last August, the EIA estimated that if all the projects announced from 2021 and 2023 become operational, battery storage co-located with renewable generation would comprise 60% of domestic battery storage systems, with 80% paired with solar. 

Meanwhile, residential projects are also feeling the heat of supply chain disruptions. Residential solar-plus-storage projects “not yet procured are being pushed to 2023, which has impacted paired storage,” said Wood Mackenzie analyst Chloe Holden.

Notwithstanding supply chain disruptions, residential storage saw its strongest quarter to date, bringing 334 MWh of storage online, a 36% jump compared with 1Q2021. 

“The segment saw over 20,000 installations in a single quarter for the first time and we’re seeing large and small installers forge new vendor partnerships to help meet rising customer demand,” Holden said. 

Residential deployments fell in some states because of the supply chain disruptions. However, California and Puerto Rico continued to see growth in the residential segment, according to Wood Mackenzie. 

The California Public Utilities Commission (CPUC) also has noted that the residential sector added 57.6 MW in solar photovoltaic or energy storage system installations in 1Q2022, compared to 53.8 MW in 4Q2021 and 48.1 MW in 1Q2021. 

Meanwhile, the CPUC recently approved a proposal from San Diego Gas and Electric Co. to add four microgrids fitted with energy storage to the San Diego region by the summer of 2023. 

Bringing a combined total of 39 MW of storage capacity, the microgrids are expected to help meet high energy demand on hotter days after the sun has set. The four microgrids could operate alongside or independent of the larger regional grid, according to SDG&E. 

The microgrids “will dispatch clean energy to the grid when needed,” said SDG&E’s vice president of energy innovation Miguel Romero. Schools, police and fire stations, as well as Cool Zones – areas in San Diego County that provide free air conditioning for those seeking to escape the heat – will be the main facilities receiving the stored energy, Romero said. 

Once operational, the microgrids will be connected to the state’s energy market for the California Independent System Operator to dispatch excess stored energy to other areas of the state as needed, according to SDG&E. 

In July 2021, California Gov. Gavin Newsom signed an emergency proclamation to expedite the deployment of renewable energy sources and storage to meet demand during extreme heat events and wildfires. The microgrids, SDG&E said, stemmed from that proclamation. SDG&E also recently brought online its 30 MW Top Gun storage facility and its 20 MW Kearny Energy Storage facility. 

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Related topics: battery storage California power grid Solar utilities

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