UGE Presents on "Challenges and Opportunities to Boost Energy Storage Deployment" at the Intersolar Summit USA East.

1. March 30, 2016
Policy Developments in Key US Markets
Challenges and Opportunities to
Boost Energy Storage Deployment
Tim Woodcock, Director at UGE
@UGE_Intl

2. March 30, 2016
Page 2
Generation Transmission Distribution Customer
Linear Grid System

3. March 30, 2016
Page 3
Distributed Generation
Generation Transmission Distribution Customers
[Generation]

4. March 30, 2016
Page 4
REV Needs Storage
Distributed
Service Platform
Customers
[Generation]
x1000

5. March 30, 2016
Page 5
DER Benefits: Front and Behind the Meter
Retail Net
Metering
Voltage
Support
Capacity
Market
Demand Charge
Management
Time of Use
Frequency
Regulation
Behind the Meter
Front of Meter

6. March 30, 2016
Page 6
Servicing Many Stakeholders Groups
Service not
possible
Energy
Arbitrage
Spin/
Non-Spin
Reserve
Frequency
Regulation
Voltage
Support
Black
Start
Resource
Adequacy
Transmission
Congestion ReliefTransmission
Deferral
Distribution
Deferral
TOU Bill
Management
Demand
Charge
Reduction
Increased
PV Self-
consumption
Backup
Power
Source: RMI

7. March 30, 2016
Page 7
Storage Applications
Short Medium Long
FrequencyofUse
RareOccasionalFrequent
Ancillary
Services
Renewables
Smoothing
Power Quality
Fuel Costs
Peak Demand
Charges
DR Revenues Nodal Dispatch
Resiliency
Time-of-Use
Shifting
Discharge Duration
Behind-the-meter application Front-of-meter application Both sides of meter
Source: GTM Research

8. March 30, 2016
Page 8
“Stacking” Makes The Economics Work
0
100
200
300
400
500
600
700
800
Cost Revenue
EstimatedValueperkWh
Theoretical Battery Value Stack
Value of Lost Load
Capacity Market
Energy Arbitrage
Resource Adequacy
Frequency Regulation
Commercial Demand-
Charge Management

9. March 30, 2016
Page 9
Technology Costs Keep Decreasing
Li-ion battery costs have dropped by ~23% each year since 2010
Expected to reach $250-300 / kWh by 2020
$1,400
$1,000
$700
$600
$500
$350
$2,000
$1,816
$1,632
$1,300
$1,100
2010 2011 2012 2013 2014 2015*
Year
Battery and System Costs ($/kWh)
Battery cost ($/kWh) Installed Commercial System Cost ($/kWh)
Source: GTM Research – (*) 2015 Industry Average Battery Pack Cost Source Bloomberg New Energy Finance

10. March 30, 2016
Page 10
Lack Of A Standard Hinders Faster Growth
Permitting made difficult with no clear technology quality standards
Test Criteria/Standard
UL IEC ISO
UL
1642
UL
1973**
UL
2054*
UL
2271**
UL
2580**
UL
2595
IEC
62133
CDV
6209
ISO
12405-3
External short circuit ● ● ● ● ● ● ● ● ●
Abnormal charge / Overcharge ● ● ● ● ● ● ● ● ●
Forced discharge / Overdischarge ● ● ● ● ● ● ● ● ●
Crush ● ● ● ● ● ●
Impact (cell) ● ● ● ● ●
Shock ● ● ● ● ● ● ● ●
Vibration ● ● ● ● ● ● ● ●
Heating (cell) ● ● ● ● ● ● ●
Temperature cycling ● ● ● ● ● ● ● ●
Low pressure (altitude) (cell) ● ● ● ● ●
Projectile / External fire ● ● ● ● ●
Drop ● ● ● ● ●
Continuous low rate charging ●
Molded casing heating test ● ● ● ● ●
Insulation or isolation resistance ● ● ● ●
Internal short circuit test or propagation test ● ● ● ●
* Cells required to comply with UL 1642 tests
** Cells required to comply with either UK 1642 test program or application specific program outlined in standard
Current Storage Quality Certification Standards

11. March 30, 2016
Page 11
Policy Hurdles & Opportunities
Current State of Play
In the Near Future
-Hard to permit
Short-term incentives
Utility rates dictate value
+Frequency Regulation
FERC Jurisdiction over DR
Distribution Deferral Markets
Stacking revenue in front of and behind the meter
Locational Based Marginal Pricing + Distribution
Storage = most valuable Distributed Energy Resource

12. March 30, 2016
Page 12
Financing Challenges
Benefits highly dependent on fickle load profiles
Rapidly-evolving technology
Policy not yet established
No standard contract

13. March 30, 2016
Page 13
Elements Of A Contract Standard
13
Choice of technology
Maturity of tech, warrants and guarantees, specs, etc.
Economic Applications
What are the BTM and FOM revenue opportunities? How are they
effected by policy and technology?
Guarantees and Indemnities
In order to reach secondary market value, contracts will need
assurances of payments and default consequences
Client credit worthiness
How does involving LDCs and ISOs effect contract viability?

14. March 30, 2016
Page 14
Let’s Road-map The Future
SAPC
ESAPC?

15. QUESTIONS?