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Chapter 14Considerations for HighPenetra... > 14.2 Energy Storage - Pg. 207

14.2 Energy Storage 207 conditioning, refrigeration, and water-heating loads. Commercial build- ings, municipal water pumps, and district heating systems all bid into the balancing service markets to absorb low-cost and relatively low-value wind generation during those occasions when consumption is otherwise low and the wind is strong. Aggregation of balancing areas will occur such that the western third of the USA, currently served by dozens of balancing areas, develops one or a few liquid markets that vastly improves the ability to trade across balancing area borders. The practice of bilateral reservations of trans- mission services is replaced by a combination of markets and bilateral `contracts for differences' (see Chapter 12). The need for new transmission and management of congestion within the expanded balancing area is managed by the single entity in coordination with appropriate stakeholders. In the grid of the future, reduction of fossil-fuel generation will become a goal in North America as it is in Europe. Carbon taxes, limits on allowable carbon emissions, or rules that specifically favor renewable generation will be imposed that cause carbon-intensive resources such as coal to be more readily displaced by lower-carbon resources.