Exelon’s utilities could spend $3 billion to $7 billion building 1.5 gigawatts to 3.5 gigawatts of regulated energy storage, company officials said on the third quarter earnings call, in addition to a $1 billion, 500 megawatt project already proposed for New Jersey. Taken together, the potential programme reaches about $8 billion.
The New Jersey project, Atlantic City Electric’s 500 megawatt development with Invenergy, would be the largest battery installation in the PJM Interconnection and is expected to provide more than $700 million of net benefits to customers, chief financial officer Robert Kleczynski said. A decision from the New Jersey Board of Public Utilities is expected late in the first quarter of next year. New Jersey, Maryland and Delaware, three states where Exelon utilities operate, allow utility ownership of storage.
Kleczynski framed regulated storage as a complement to merchant development rather than a replacement for it, arguing that utility ownership gives certainty that projects get built and control over when and how they are deployed, with investment tax credits flowed through to customers to soften the rate impact. Chief executive Calvin Butler said PJM is not adding generation fast enough and that two of the grid operator’s capacity initiatives have been delayed by partial federal approvals.
The storage ambition sits on top of an already large capital programme. Exelon’s current plan calls for $16.3 billion of transmission investment through 2029, with a further $12 billion to $17 billion of transmission opportunity identified beyond it, much of it tied to large loads. The company’s high probability large load additions held at 11 gigawatts, while its wider pipeline slipped to 23 gigawatts from 25 gigawatts last quarter. Third quarter net income fell to $729 million from $875 million a year earlier, on higher rate case writeoffs and storm and interest costs, against revenue of $7.3 billion.