Higher Energy
Curriculum/Grid Operations
Grid OperationsLayer 74 min

Batteries as Reserves

Batteries respond to frequency deviations in milliseconds. Gas turbines take minutes. For fast frequency response, batteries are not just competitive. They are physically superior.

Lithium-ion batteries have entered ancillary service markets across the US, providing frequency regulation, spinning reserves, and fast frequency response at speeds that thermal generators cannot match. In PJM, batteries providing frequency regulation earned roughly 2x the revenue per MW compared to gas generators in 2022, because PJM's performance-based regulation market pays more for speed and accuracy.

The limitation is duration. A 100 MW / 400 MWh battery can provide frequency regulation for hours but can only sustain a 100 MW spinning reserve commitment for 4 hours before depleting. A gas turbine can sustain reserves indefinitely (as long as fuel flows). For services requiring sustained output (non-spinning reserves, replacement energy), batteries must be paired with longer-duration resources or sized with excess energy capacity.

Hornsdale Power Reserve (Australia). Tesla's 100 MW / 129 MWh battery in South Australia (since expanded to 150 MW / 194 MWh) responded to a coal plant trip in 2017 in 140 milliseconds, before the gas turbines that were supposed to provide backup had even started ramping.

If the battery responded first, did the gas turbines still need to respond?

Yes. The battery arrested the initial frequency drop (fast frequency response), but it could not sustain 150 MW output long enough to replace the lost coal generation. Gas turbines provided the sustained backup. The battery bought time; gas provided the energy. This is the complementary model: batteries for speed, thermal for duration.


Question 1 of 2

Batteries earn premium revenue in PJM's frequency regulation market because:

PJM pays based on response speed and accuracy. Batteries respond in milliseconds with precise output control, earning higher per-MW payments than slower, less precise gas turbines.

The answer is B

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