Updated October 2021
Energy storage technologies are rapidly entering the marketplace, with tremendous potential to expand the benefits and uses of solar energy. Annual energy storage deployment is expected to increase nine-fold in the next few years, reaching 34,784 Mwh in 2026. Many of these systems are expected to be paired with renewable energy, especially solar power.
Energy storage allows solar energy to be deployed at all times of the day or night, making the electricity grid more flexible to changes in demand. Solar coupled with battery storage also improves grid resiliency by providing a backup energy source for homeowners and businesses when storms or other emergencies cause a power failure.
Local governments have many tools at their disposal to help encourage solar and battery storage in their communities. This section of the Solar Energy: SolSmart’s Toolkit for Local Governments will explain how solar-plus-storage systems work, followed by guidelines for communities on how to foster the development of this technology and successful examples at the local level.
While energy storage takes many forms, and includes thermal and mechanical systems as well as batteries, solar-plus-storage typically consists of a solar array connected to a battery technology that stores the energy for future use. When directly connected to the transmission or distribution system, storage is referred to as front-of-the-meter storage. This type of storage is typically coupled with utility-scale solar projects. Behind-the-meter storage refers to storage that is deployed at residential or commercial scales with distributed energy, such as solar arrays on households and businesses.
The same trends that have driven the expansion of solar energy in recent years are also encouraging the growth of solar-plus-storage. Declining costs, high electricity rates, favorable policies, and new incentives are spurring the growth of the battery storage market. Utility-scale battery storage costs declined nearly 70% between 2015 and 2018. As storage costs decline, the value of the solar-plus-storage package increases. While adding storage to a solar PV system increases total installation costs, a system with storage ultimately provides a greater return on investment.
Behind-the-meter storage can also provide these benefits, but market structures may not allow these systems to integrate into the grid. Independent system operators (ISOs) may have capacity requirements to participate in grid services programs, which may exclude distributed or behind-the-meter projects that tend to be smaller. However, behind-the-meter storage provides other benefits to the electricity consumers. These benefits include:
The value of solar-plus-storage will vary depending on state and local policies. In areas where net metering is unavailable, storage allows individuals to reserve energy for future consumption instead of selling it back to the grid at an uneconomical rate. State policies that establish variable electricity rates, such as demand charges or time-of-use rates, can also encourage the use of storage by adjusting the value of electricity based on demand. Currently, it is much more common for these variable rate structures to apply to businesses rather than residences. Residential demand for storage will grow as utilities adopt more variable rate structures for this market segment, which is already well underway in California.
The Solar PV Construction section of this toolkit describes ways to make the permitting process faster and more efficient in order to lower the cost of a solar energy system. Similar strategies can also encourage the growth of solar-plus-storage at the local level. The primary factors to consider when designing permitting processes for storage include the location of the energy storage system (inside or outside) and the fire and safety requirements and regulations that vary by energy storage type.
The storage component of a system can be placed either inside or outside of a building. Typically, systems located inside a building have more stringent permitting and inspection requirements, particularly if a property is inhabited. These precautions are due to fire and safety considerations. In contrast, outdoor systems often have less stringent permitting and inspection requirements, as there tends to be greater ventilation outside and the systems are more easily accessible for service in times of emergency.
The Planning, Zoning, and Development section of this toolkit describes ways communities can adopt solar-ready construction guidelines. In a similar way, storage-ready construction can promote solar-plus-storage development. Storage-ready construction can reduce installation costs by up to $2,500 and support deployment on critical infrastructure. While there is no available resource that provides solar + storage-ready guidelines, a report prepared for NYSolar Smart Distributed Generation Hub outlines a few key considerations, including: the installation of a grid-tied inverter to allow for quick connection of a dual function inverter when a storage system is installed; allowing space in the mechanical rooms for equipment; and ensuring the space for the storage system is above the flood plain to avoid permitting complications.
Communities should engage with their local utilities to encourage the deployment of solar-plus-storage systems. Utilities can facilitate this process through streamlined interconnection procedures, and utility-led initiatives such as demand response programs or incentives.
In 2017, Green Mountain Power (GMP) in Vermont implemented a residential battery storage program, which offered its ratepayers the option to lease a Tesla Powerwall battery. Participating homeowners lease systems for $15/month and receive 8-12 hours of backup power. Green Mountain Power aggregated these systems to reduce overall grid load during peak times to save on capacity and transmission expenses. After 500 of these batteries were deployed, GMP saved $500,000 in a single-day by reducing peak demand during a July heat wave.
The program followed up by offering 500 spots in its Resilient Home pilot program, which offers two Tesla Powerwall batteries, which amounts to 12-24 hours of backup power. GMP also offers financial incentives through its Bring Your Own Device program for battery devices bought from a Vermont retailer.
Local governments are increasingly looking to solar energy resources and microgrids to support grid resilience. In the wake of recent hurricanes, wildfires, and other natural disasters, disaster preparedness is a frequent topic of discussion. One of the essential components of resilience is the need to keep critical facilities — those needed for medical, public safety, and national defense — operating during prolonged grid outages.
The following is a list of critical infrastructure sites that greatly benefit from solar-plus-storage resiliency:
Traditionally, communities have relied on diesel-fueled generators for emergency backup power. Solar energy is an attractive, emissions-free alternative that can be paired with battery storage to operate during power outages. Many communities are exploring solar-based microgrids, small portions of the grid designed to be capable of operating in an islanded mode with local generation and storage resources. Resilient systems typically use smart inverters that enable multi-directional power flow between the system and the grid. In some cases, systems can “island” or disconnect from the central grid and provide power to all or a portion of their electrical load. The size of the system and the technologies employed will determine the size and duration that these systems can cover during times of grid failure.
Municipalities can incorporate resilient solar systems directly on public facilities or into their emergency planning measures, and they can encourage the use of these systems in their jurisdictions. Salt Lake City is one example of a city using solar energy to enhance its emergency preparedness for critical facilities and businesses. Salt Lake City is also home to the nation’s first “net zero energy” public safety building, where 380 kW of rooftop solar PV is installed and 30 percent of those panels are able to become islandable and provide electricity in the event of a grid outage. Similarly, the city of Portland, Oregon incorporated a solar-plus-storage system on a fire station for improved resiliency and response time during grid outages. In Puerto Rico, the devastation from the 2017 hurricanes has led to growing interest and investment in solar + storage to provide backup power at critical locations such as hospitals and community centers.
The use of solar energy to improve resiliency is not limited to buildings. Table 1 outlines other applications of resilient solar. Note that these applications may include storage, but do not necessitate its use.
Table 1: Other Applications of Resilient Solar
Multiple branches of the U.S. Air Force, Navy, and Army are boosting their resilience by installing microgrids with distributed solar and storage on military installations. In Georgia, 30 MW of microgrid-ready on-site solar is operational at the Ford Gordon, Fort Stewart, and Fort Benning bases. These systems are designed to provide enough power to serve all critical loads on their respective bases for an indefinite period of time during emergencies. And unlike diesel generators, these solar energy systems are connected to the grid and provide electricity on an everyday basis. This arrangement is helping generate additional revenues, in turn lessening the impact of the installations on the U.S. Department of Defense capital budget.
The Marine Corps Air Station (MCAS) has constructed one of the most sophisticated microgrids in the country, helping meet the military’s paramount need for critical power resilience. The microgrid combines numerous energy sources along with battery storage, including 1.3 MW solar PV capacity, EV charging station control, 3 MW energy storage, and 390 kW building level energy storage.
Solar-plus-storage can be integrated into a community’s Solarize campaigns, which are group purchase programs that allow for solar energy installations at discounted rates. More information on Solarize campaigns can be found in the Market Development and Finance section of this toolkit. When designing a Solarize campaign, a community can request battery storage installation options while soliciting proposals from installers. Other considerations for a group purchase solar-plus-storage campaign include drafting a statement as part of the RFP as to why the community is including storage in the RFP; adjusting the qualifications of the installer as some installers do not offer storage services; and considering the costs associated with storage installation.
Storage can also be integrated into community solar projects, which allow participants to purchase solar from off-site locations without installing systems on their own property. Austin Energy, a public utility in Texas, developed a community solar-plus-storage project with funding from the Department of Energy SHINES program (Sustainable and Holistic Integration of Energy Storage and Solar Photovoltaics). The La Loma Community Solar Project combines utility-scale solar generation with energy storage to allow Austin residents to utilize solar energy.
More information can be found in the Community Solar section of this toolkit. Additional information is provided in the SolSmart Issue Brief, Expanding Consumer Participation Through Community Solar.
The following are two examples of communities that have implemented solar-plus-storage solutions to support their resilience strategies.
In 2003, the Hartley Nature Center in Duluth, Minnesota installed one of the first solar PV systems in Minnesota. Thirteen years later, the inverters in the system were beginning to fail, and the nonprofit organization that managed the facility was seeking energy efficiency upgrades. To ensure the Hartley Nature Center would continue its role as a renewable energy pioneer, they explored ways to include energy storage as part of the retrofit construction project. The energy storage system would cut energy costs, provide educational opportunities, and enable the center to serve as an emergency shelter site. In 2016, the city of Duluth suffered its first week-long power outage in over a decade due to a severe thunderstorm with high winds, reaffirming the importance of an energy system built for resilience.
The University of Minnesota, the local nonprofit Ecolibrium 3, and city of Duluth staff identified a project developer, selected vendors, obtained the permits, and led the Hartley Nature Center through the development process. The Nature Center identified emergency loads which would enable it to operate effectively as a shelter site and continue mission-critical services. The restored system features a new islandable inverter and a 6 kW/14.2 kWh lithium-ion battery to support the 13.1 kW solar PV installation.
The system was completed in the spring of 2017, and is among the first solar-plus-storage retrofit projects in the country. The installation process was open to solar installers, electricians, and others seeking continuing education credits for their professions. In the future, the Nature Center will use the system to train local installers. When the system went online, the city of Duluth hosted an educational Solar and Storage Awareness Day for the community.
The Hartley Nature Center project received strong community support from organizations within Duluth and across the nation, such as the Minnesota Power Foundation, the Clean Energy Group, and the U.S. Department of Energy Solar Market Pathways program. Funding and in-kind support helped assist with the cost of the retrofit project, which has provided important lessons learned for other communities. The city is using the results of the project to explore resilient solar installations on city-owned facilities.
The installation saves the Nature Center $1500 annually, provides resiliency benefits to the community, and moves the Nature Center toward its net-zero energy goal.
The City and County of San Francisco (CCSF) wanted to explore the use of solar PV and battery energy storage as backup power for disaster preparedness planning. The CCSF Department of the Environment (SFE) worked with emergency management and the local electric utility to prioritize facilities across all of San Francisco’s districts with critical power and emergency needs.
The first step was a review of the existing emergency management plans. Through this research, CCSF identified key emergency response facilities. CCSF also used GIS analysis of soil liquefaction and tsunami zones to identify facilities likely to be operational after an emergency, such as a flooding or earthquake. For select types of critical facilities (such as schools and hospitals), the project team visited and analyzed each site’s hypothetical electricity requirements during an emergency (known as critical loads). As a result, CCSF could use the information obtained from SFE’s research to prioritize solar + storage deployment throughout its neighborhoods.
SFE fostered internal collaboration across departments and leveraged existing processes and procedures to integrate energy resilience. SFE examined the possibility of solar + storage in the event of a large-scale disaster in San Francisco by researching critical loads in individual and groups of buildings. SFE developed the online SolarResilient tool, which allows other municipalities nationwide to conduct similar analyses. This tool can provide an initial estimate of the appropriate system and physical sizing for solar, storage, and other backup generators to support emergency power needs.
Solar PV and Energy Storage Sizing Tool
This tool, developed by the City of San Francisco Department of the Environment (SFE), enables communities across the U.S. to estimate the appropriate system and physical size of a solar + storage system focused on demand charge management and/or resilience with a few simple inputs.
SFE’s Solar and Energy Storage for Resiliency Web Page
This Web page includes information regarding SFE’s solar for resiliency project, including the goals, objectives, and results. Additionally, it provides a set of tools and resources including the Resilient Solar and Storage Roadmap and Best Practices Guide.
New York Solar Map Website
The City University of New York Smart Distributed Generation Hub has developed a library of in-depth resources on solar + storage economics, permitting, and hardware.
Solar PV Emergency and Resilience Planning Fact Sheet
This resource, prepared by Meister Consultants Group, Inc, provides information on solar PV applications for emergency planning and how to analyze criteria to choose the right type of solar application for resilience. The fact sheet also provides case studies on municipalities that have implemented solar for emergency and resilience planning.
 U.S. Energy Storage Monitor: Q3 2021 Executive Summary, Wood MacKenzie Power & Renewables/U.S. Energy Storage Association. https://www.woodmac.com/research/products/power-and-renewables/us-energy-storage-monitor/
 U.S. Energy Information Administration, “Utility-scale battery storage costs decreased nearly 70% between 2015 and 2018,” October 3, 2020, https://www.eia.gov/todayinenergy/detail.php?id=45596
 NY Solar Smart DG Hub, Resilient PV Retrofit and Storage Ready Guidelines Fact Sheet, accessed September 26, 2019. https://nysolarmap.com/media/1639/dghubresiliencyretrofitfactsheet_final.pdf
 Wilson, Alex, New Public Safety Building in Salt Lake City a Model of Resilience, Resilient Design Institute, June 2014. https://www.resilientdesign.org/new-public-safety-building-in-salt-lake-city-a-model-of-resilience/
 Zipp, Kathy, “Solar+storage will provide ongoing power during emergencies at Portland’s main fire station,” Solar Power World, March 2017. https://www.solarpowerworldonline.com/2017/03/solarstorage-will-provide-ongoing-power-emergencies-portlands-main-fire-station/
 The Interstate Renewable Energy Council (IREC) is currently partnering with rural Puerto Rico communities to install solar-plus-storage microgrids that will power essential local businesses. More information is at https://irecusa.org/programs/puerto-rican-solar-business-accelerator/.
 Meister Consultants Group, U.S. Department of Energy Solar Outreach Partnership, Solar PV Emergency & Resiliency Planning, July 2013. https://icma.org/sites/default/files/306453_Solar%20PV%20Emergency%20%26%20Resilience%20Planning%20Fact%20Sheet.pdf
 NY Solar Smart DG Hub, Guidance Memo for Including Storage in Community Solarize Programs, accessed September 26, 2019. https://nysolarmap.com/media/1694/solarizeplusstorage_guidance_oct2016.pdf
 Austin Energy, “Austin SHINES: System Overview and Project Benefits,” accessed September 26, 2019. https://austinenergy.com/ae/green-power/austin-shines/system-overview-project-benefits