New Report: Market Reforms to Harness Energy Storage and Strengthen Regional Grid Reliability

Analysis Details Electricity Market Design Reforms to Unlock the Potential of Storage 

WASHINGTON, D.C., April 8, 2025 — Today the American Clean Power Association (ACP) released an Energy Storage Market Reform Roadmap and analysis produced by the Brattle Group, outlining several key reforms that regional grid operators can enact to leverage the unique capabilities of energy storage technologies.  

While some regions of the United States have made progress integrating energy storage into energy resource portfolios, several organized electricity markets have yet to unlock the benefits of energy storage. Energy storage is designed to enhance grid reliability and improve the integration and operation of all energy resources. California and Texas have demonstrated that with updated market rules, energy storage delivers substantial value and complements both thermal and renewable generation to meet the unique reliability needs of each region. 

“Energy storage technologies add a new dimension of flexibility and efficiency to our electric grid,” said ACP VP of Energy Storage Noah Roberts. “Energy storage has proven to boost reliability and lower energy costs. In Texas, the state added 5 GW of energy storage in one year, eliminating calls for customers to reduce electricity use during historic summer heat, stabilizing the grid through volatile winter storms, all the while delivering more than a billion dollars in energy cost savings. This roadmap outlines actionable steps to better utilize energy storage to deliver reliable and affordable power across the United States.” 

Progress Since FERC Order 841
Before FERC Order 841, energy storage faced broad and significant barriers to participating in U.S. wholesale electricity markets. Participation was limited by market rules designed primarily for traditional power generation technologies. Where deployment is encouraged and barriers have been removed, energy storage resources have helped prevent blackouts and reduce pressure on consumers during historic winter and summer events, while delivering significant cost-savings. 

Reforms to U.S. Markets to Deploy Energy Storage Boosts Reliability 

In several regions, there are substantial opportunities for reforms that will enable energy storage to participate in boosting the reliability and resilience of our power grid – while also alleviating utility bill impacts from historically high capacity prices. 

The American electric grid faces surging demand for more power, creating a need to quickly build and connect more resources and improve flexibility. Energy storage is a proven solution to affordably scale energy supply and grid capacity in a way that makes the grid more efficient and resilient. However, without modernization of market rules, energy storage resources will be restricted from contributing to regional grid reliability, risking economic growth and energy security.  

“Many existing rules around energy markets were developed prior to the advancement of new technologies. As electricity grids struggle to keep pace with the feverish growth in energy demand across the country, every electron of power counts,” said Stephanie Smith COO of Eolian. “Battery energy storage helps both thermal and renewable energy technologies optimize their participation and increase reliability and resilience by providing power when and where it is needed quickly. By updating existing rules to account for new technologies, regional electricity markets can enhance grid performance and lower costs for consumers.” 

Energy Storage Industry Advancing Reliability Solutions 

Updates and reforms can make considerable improvements to electricity markets. Recently, PJM began changing its Surplus Interconnection Service (SIS) rules, which would accelerate the deployment of energy storage to support and enhance sites with existing energy generation. Regional grid operators are poised and well positioned to make additional impactful reforms.  

• In the central region of the United States, an updated approach to MISO’s capacity accreditation modeling can help realize the reliability benefits and operational flexibility that storage has delivered in states like Texas and California. 

• In the Midwest and Mid-Atlantic, PJM can amend rules that would allow energy storage facilities to deliver power when it’s needed most, harnessing the technology’s ability to quickly react to real-time market conditions. 

• In New York, the ISO can make changes to better enable energy storage to efficiently match power supply with demand, saving money and improving grid stability.  

ACP and its members are committed to collaborating with regional grid operators, state policymakers, and stakeholders to advance reforms that enhance grid reliability and lower costs for Americans. 

“Alliant Energy is dedicated to pioneering energy solutions that benefit our customers and communities,” said Ben Lipari, Vice President of Commercial Operations for Alliant Energy. “Battery energy storage, including long-duration energy storage systems, such as our Columbia Energy Dome Project, represent our commitment to deploying new grid technologies supporting the evolving mix of renewable energy and traditional energy sources to deliver what matters most to our customers, communities and the region – reliably, responsibly and affordably”. 

“As Jupiter Power is demonstrating by the near-term expansion of its operating portfolio outside of ERCOT, there is an opportunity for regional electric grids to deploy the unique attributes of storage to meet rising demand from data centers and other large new loads,” said Caitlin Smith, Vice President of Policy & Corporate Communications for Jupiter Power. “Batteries are the most dispatchable resource on the grid and this important roadmap highlights BESS as a tool not only for capacity but also to manage the quick fluctuations on the grid, day-ahead uncertainty, and local congestion.” 

“Energy storage is a game-changing tool that is already making our nation’s grid stronger. As Clearway continues to harness the power of our existing storage fleet and expand with new investments across the country, we recognize the urgent need for energy markets to evolve and fully capture the unique benefits of storage technologies.” said Hannah Muller, Senior Director of External & Market Affairs for Clearway. “We look forward to collaborating with ACP and regional grid operators to update market rules, and this roadmap will catalyze the acceleration of this work.” 

Find the full analysis, the executive summary, and the ISO-specific roadmaps on cleanpower.org. 

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