With regulatory agencies incorporating safety specifications for energy storage deployments into new building codes and safety standards, the battery energy storage system has clearly become the mainstream energy storage technology. Batteries have been in use for over 100 years since their invention, while solar power generation technology has been adopted for over 50 years. In the early stages of the solar energy industry, solar power facilities were typically deployed in remote locations away from the grid, primarily for powering remote facilities and residences. As technology advances and time goes by, solar power facilities have begun to directly connect to the grid. Nowadays, an increasing number of solar power facilities are being deployed in conjunction with battery energy storage systems.
For a long time, energy storage system providers have been supporting the development of solar plus storage projects behind the scenes, while some large solar power facility installers have started offering their own battery products to their customers in the past few years. These companies state that as the market share of solar plus storage projects grows significantly, users find it more attractive to have a well-performing and long-lasting lithium-ion battery energy storage system deployed alongside. When major developers in the solar power generation sector begin to get involved in battery production, these companies' marketing efforts, information dissemination, and industry influence will enhance awareness among consumers, businesses, and governments. Their smaller-scale competitors are also taking action to ensure they don't fall behind.
Since a famous "duck curve" issue was raised by a company in California, the impact of high penetration of solar power generation on the grid has been increasing, and battery energy storage systems have become a potential solution to mitigate the "duck curve" issue. However, it was not until some industry experts compared the cost of building a natural gas peaker plant with the cost of deploying battery energy storage systems that utilities and regulatory agencies realized the cost-effectiveness of battery energy storage systems in offsetting intermittent renewable energy. Nowadays, many states and local governments in the United States incentivize the deployment of grid-side and customer-side battery energy storage systems through programs such as California's Self-Generation Incentive Program and New York's Large-Scale Energy Storage Incentive Program. These incentive measures have a direct or indirect impact on the demand for energy storage deployment. Just as government incentives for energy technology can be traced back to the Industrial Revolution, this means that businesses and consumers should actively embrace this technology.
One of the main signs that battery energy storage systems have become the mainstream energy storage technology is their inclusion in the latest regulations and standards. The building and electrical codes released by the United States in 2018 incorporate battery energy storage systems, but the UL 9540 safety testing standard has not been included. After productive communication and engagement between industry stakeholders and the main regulatory body for safety regulations in the United States, the National Fire Protection Association (NFPA), the standard specification was released at the end of the year. The newly released electrical code in the United States has been harmonized, providing the same level of guidance as HVAC and water heater equipment for regulatory agencies and building departments.
In addition to ensuring safe deployment, these standardized requirements help building departments and regulators enforce safety requirements, making it easier for them to handle safety issues related to batteries and related equipment. As regulatory bodies establish regular procedures for the installation of battery energy storage systems, it reduces the risks associated with these critical steps, shortens project deployment time, reduces costs, and improves the customer experience. Like previous standards, this will continue to drive the development of the solar plus storage sector.