Discover the economic case for deploying 2-hour battery energy storage projects in the Electric Reliability Council of Texas (ERCOT) region. As solar resources outpace wind in Texas, energy storage systems have become essential assets for grid reliability and resiliency. Texas faces distinct challenges that require seamless integration of renewable energy and cost-effective peak demand management. This whitepaper presents a comprehensive analysis of the benefits of a 2-hour battery energy storage system (BESS) in ERCOT, highlighting its crucial role in meeting these challenges and maximizing revenues in the merchant wholesale market.

Maximizing Revenue Opportunities with BESS 

BESS resources in ERCOT offer excellent opportunities for revenue maximization in the merchant wholesale market. Through Stem’s comprehensive revenue simulations, we demonstrate that a 2-hour BESS can increase cash flows relative to a 1-hour system. The whitepaper explores the details of Stem’s revenue simulations and the software used for the final analysis.

The Role of BESS in Grid Reliability and Resiliency 

The paper also delves into the unique obstacles faced by Texas, including its islanded system and increasing variable renewable generation. Integrating battery energy storage systems at new and existing sites is vital to help ensure a reliable and resilient grid. Deploying battery energy storage systems is crucial to meet peak demand cost-effectively and seamlessly integrate renewable energy into ERCOT.

Context and Expert Analysis 

The paper includes expert analysis to comprehensively understand ERCOT’s market fundamentals, available revenue streams, and Texas energy policy. These valuable insights contextualize the economic case for deploying 2-hour battery energy storage projects and further strengthen the argument for their implementation.