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Conference Agenda

Overview and details of the sessions of this conference. Please select a date or location to show only sessions at that day or location. Please select a single session for detailed view (with abstracts and downloads if available).

Please note that all times are shown in the time zone of the conference. The current conference time is: 24th Aug 2026, 01:52:00am WEST

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Daily Overview

Session

Egg-Timer: Carbon Markets and Climate Policy
Location: D-107
Session Chair: Jiwon Im, Seoul National University

Presentation 6

When Is Energy Storage Welfare Improving? Theory and Evidence from California Electricity Markets

Antonio Bento^1,2, Daniel Kaffine³, Andrew Waxman⁴

1: Sol Price School of Public Policy and Department of Economics, University of Southern California; 2: NBER; 3: Department of Economics, Renewable and Sustainable Energy Institute, University of Colorado Boulder; 4: University of Texas Austin, United States of America

Energy storage is emerging as a critical component of the energy transition, allowing

intertemporal arbitrage of power and addressing challenges raised by the intermittency of the growing share of renewable energy. In this paper, we combine theory and empirical methods to assess the market and welfare implications of battery storage adoption and battery storage policies. Our theoretical exercise enables us to decompose the key welfare effects in a Marginal Value of Public Funds framework, while our empirical exercise leverages a natural experiment in California (the Moss Landing fire in 2025) to estimate key parameters and causal effects. Unsurprisingly, battery storage lowers peak power prices, but importantly we show that a key role of storage is that it reduces renewable curtailment, generating emission savings that would have otherwise gone to waste. Preliminary calculations of the first-order components of the MVPF suggest a value of 1.56 for battery storage subsidies in California. While greater than one, the MVPF is substantially smaller than for renewable subsidies (wind in particular), reflecting the relatively clean grid in California and relatively high levelized cost of storage.