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Electricity Monthly Update

With Data for April 2023 Release Date: June 27, 2023 Next Release Date: July 25, 2023

Highlights: April 2023

  • Wholesale electricity prices set new 12-month lows in New England (ISONE) and Southern California (CAISO) during April 2023.

  • Electricity demand set a new 12-month low in the Midwest (MISO) on April 9.

  • Total U.S. coal stockpiles had a month-over-month increase of 8.2%, reaching 119 million tons in April 2023.

Key indicators

Statewide average temperature ranks
Statewide precipitation ranks
Total net generation
Net generation by select fuel sources

Battery storage uses remained similar even as capacity grew sharply in 2022

Installed battery capacity, RTO versus non-RTO markets, 2016 to 2022

Data source: U.S. Energy Information Administration, EIA-860 2022 Early Release Data, Form EIA-860, Annual Electric Generator Report.
Note: Utility-scale facilities have capacities greater than or equal to 1 megawatt. Data for 2022 are preliminary. Regional Transmission Organizations (RTOs) operate bulk electric power systems across much of North America. RTOs are independent, membership-based, non-profit organizations that ensure reliability and optimize supply and demand bids for wholesale electric power.

Installed battery storage capacity increased by 84% from 4,910 megawatts (MW) in 2021 to 9,056 MW in 2022, according to the early release of the 2022 EIA-860, Annual Electric Generator Report. This gain was due to 107 utility-scale batteries, with a cumulative 4,112 MW of capacity (other capacity adjustments account for the 35 MW difference), that were installed across the United States. About 93% of the battery storage capacity added in 2022 was built in service territories where a regional transmission organization (RTOs) manages the grid. This number of installations is significantly above historical averages and brings the overall RTO battery capacity to account for 86% of total battery capacity installed on the U.S. electric grid. The RTO battery capacity is disproportionately high because RTOs account for only 65% of total U.S. generating capacity.

Although capacity increased significantly in 2022, operators reported use cases at proportions similar to those in 2021. Use cases are identified by operators and reported to EIA to indicate the purposes that the batteries are intended to serve. The average number of use cases per battery application remained constant at 2.4. Over 75% of the installed units reported multiple use cases.

U.S. utility-scale battery storage applications, 2016 to 2022

Data source: U.S. Energy Information Administration, EIA-860 2022 Early Release Data, Form EIA-860, Annual Electric Generator Report.
Note: Utility-scale facilities have capacities greater than or equal to 1 megawatt. All others include total use case-capacity for load following, backup power, co-located renewable firming, or transmission and distribution deferral. Data for 2022 are preliminary. Operators can report multiple uses for the same unit.

Frequency regulation continued to be, on a capacity basis, the most often-cited use case, with over 74% (6,658 MW) of total battery storage capacity. Frequency regulation keeps the system-operating frequency as close as reasonably possible to 60 hertz (Hz), which was particularly prevalent in the PJM Regional Transmission Organization, where it was associated with 94% of battery capacity. These data demonstrate the continuing importance of ancillary services to battery operators.

In 2021, arbitrage emerged as one of the more commonly cited use cases, and this trend continued through 2022 as battery operators sought to take advantage of short-term pricing differences in wholesale power markets. In general, arbitrage means that a battery storage unit will charge its batteries during low-price periods and discharge them during high-price periods. Battery operators in the RTO markets of Texas (ERCOT) and California (CAISO) collectively accounted for 95% of all arbitrage use case capacity. Both markets exhibit preferred conditions for this practice because each has substantial solar capacity that produces power during low-price periods followed by a surge in demand late in the day when higher-cost capacity is forced to run.

Ramping and spinning reserve and response to excess wind and solar generation were the next two most common use cases after arbitrage. Batteries that provide ramping and spinning reserve services are providing generation as needed when conventional resources are either increasing or decreasing their load-carrying ability or have lost their ability to support load and require quick replacement. The ramping and spinning reserve use case was cited by operators in over 56% (2,311 MW) of battery capacity installed in 2022 and all but one of the 33 batteries associated with this use case were in RTO markets.

Batteries that respond to excess wind and solar generation absorb energy that would otherwise be curtailed. This use case was associated with about 33% (1,522 MW) of the battery capacity installed in 2022. Battery storage is often paired with intermittent renewable sources, predominantly solar, because battery storage can absorb and discharge energy at different times. Of the 107 units installed in 2022, 63 were co-located with planned or existing solar capacity.

In summary, battery storage applications installed in 2022 indicate that the services that batteries have been providing continue to be important to the grid. Among key trends continuing in 2022 were participation in ancillary services, particularly frequency response, and arbitrage. The continued growth of solar capacity was an important factor that underpinned these trends.