California is an attractive market for behind-the-meter energy storage -- closet-sized lithium-ion batteries, quietly charging and discharging power to help commercial and industrial customers shave peak consumption and reduce demand charges. Someday, those batteries will be able to earn extra money by responding to grid commands -- and for Green Charge Networks, that day has arrived.

Last week, the Santa Clara, Calif.-based startup announced it has 61 sites across California, adding up to 13.3 megawatt-hours of energy storage capacity, ready to share their capabilities with the grid. That’s a figure that puts Green Charge in contention with competitors like Tesla and partner SolarCity, Stem, Coda Energy and Sunverge in terms of total megawatts deployed in the state.

The vast majority of that 13.3 megawatts isn’t participating in grid markets today, because no such markets really exist. But where there’s opportunity, Green Charge is getting into the action -- first through customer Mountain View-Los Altos High School District, which will soon start bidding its 1.1-megawatt-hour Green Charge system into Pacific Gas & Electric’s Supply Side Pilot (SSP).

SSP is the second round of an ongoing transformation of the state’s demand-response programs to allow aggregated distributed energy resources (DERs) to compete against big power plants and large-scale demand-response portfolios. Green Charge rival Stem was the first company to publicly announce that it’s aggregating batteries for these grid energy markets last year, which makes Green Charge the second.

“The rest of the contracted megawatt-hours are to begin in 2016,” Green Charge CEO Vic Shao told GTM in a Friday interview. “For all the systems we’ve installed or are installing, there’s extra battery capacity that can be utilized for the good of the grid operator. Through this extra arrangement, we’re monetizing that value.”

Green Charge projects that it will be able to achieve $150,000 to $250,000 in extra revenue from the range of grid opportunities from the systems it’s aggregating over their 10-year contract life. That figure is based on modeling potential long-term revenues from an SSP-type grid services contract, along with “a couple of other data points” the company is looking at, he said.

“A lot of these programs are going to be fully matured, not today, but the next year and the year after that -- and our arrangements will evolve as time goes on,” he said.

Shao declined to elaborate on how Green Charge intended to get the rest of its batteries into grid service. But it’s likely the startup will be targeting some key opportunities emerging as California upgrades its utility and grid regulations to bring DERs into play.

The first -- the Demand Response Auction Mechanism (DRAM) -- is already underway. This summer, the California Public Utilities Commission approved this new way for California’s big three investor-owned utilities to seek out the demand-side resources they need to meet their resource-adequacy requirements for times of peak power demand.

Instead of bilateral contracts, the DRAM will open the bidding to multiple participants -- including aggregated distributed resources. Utilities PG&E, San Diego Gas & Electric and Southern California Edison issued their DRAM requests for offers in late September, and expect to announce winners in late November.

We’re sure to see some battery-assisted projects join traditional demand-response resources to compete for a piece of these DRAM contracts, with likely contenders including Tesla and partners like EnerNOC. Shao wouldn’t say whether or not Green Charge intended to bid any part of its 13.3 megawatts into this process, but he did say that it’s one of the opportunities being considered.

Behind-the-meter batteries could also find money-making opportunities through the California Independent System Operator, the state’s grid operator. This summer, CAISO approved plans to open its energy and ancillary services markets to distributed energy resources providers (DERPs) -- companies that can aggregate at least 500 kilowatts of grid-responsive assets to receive and respond to its dispatch commands. That program could be underway as early as next year.

Then, there’s the option of batteries standing in for utility investments into the distribution grid and large-scale capacity needs. Last year, Southern California Edison contracted for more than 200 megawatts of energy storage as part of its local capacity resource procurement for western Los Angeles and Orange counties. Those contracts included distributed storage from Stem, Advanced Microgrid Solutions and Tesla, and Ice Energy and NRG Energy.

Shao wouldn’t provide any specifics about how Green Charge might be working on prospects on these fronts, but he did say that “we are working with all three utilities on fleshing out these scenarios. When you’re talking about 13.3 megawatt-hours of projects, across three systems -- there’s meaningful enough impact to serve the needs of the grid when utilities need it.”

The CPUC’s distribution resource plan and integrated demand-side resource proceedings are where regulators, utilities and DER providers will hash out how to value distributed energy as an alternative to grid investment. Already, California’s big three investor-owned utilities have created circuit-level DER interconnection maps that are “helping us make that determination as well,” he said.

The biggest wild card opportunity is in backing up solar PV with batteries. On this front, Green Charge Networks is working with SunEdison on projects in California, joining other contenders like Stem and SunPower, Tesla and SolarCity, and many others.