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Massachusetts Battery Storage Measures: Benefits and Costs

by Elizabeth A. Stanton

Jul 1, 2018

This Applied Economic Clinic white paper provides the calculations and assumptions necessary to estimate complete 2019 benefit-cost ratios for battery storage measures in Massachusetts, using a methodology identical to that of the program administrator's own "BCR Model" spreadsheets for the 2019-2021 and previous three-year efficiency plans. The resulting Massachusetts benefit-cost ratios for battery storage in 2019 are:

  • 2.8 for a single-family home battery under the low-income efficiency program
  • 3.4 for a multi-family apartment complex battery under the commercial and industrial efficiency programs

The benefits of electric battery storage outweigh their costs, and, therefore, must be offered by Massachusetts electric program administrators to their customers, in accordance with the Green Communities Act. This white paper reviews the calculation of a value for battery storage of the cost and each type of benefit included in Massachusetts' cost-effectiveness assessment: avoided energy, avoided energy demand reduction induced price effects (DRIPE), summer generation capacity, winter generation capacity, electric capacity DRIPE, transmission, distribution, and reliability, non-energy benefits, and non-embedded environmental costs. Of these benefits, avoided capacity costs are by far the most substantial.