MegaWatt Storage Farms is a storage developer, a new entity – like a solar developer, except with energy storage. And like a solar developer, they are somewhat technology agnostic.
Some background. California, like many states, is in a race to reach ambitious Renewable Portfolio Standards and is increasingly bringing solar and wind farms online. Both of these energy sources are less than consistent.
Here's an example of a "spaghetti chart" on a wind farm's output. The average is steady but the hour to hour change is striking.
And here's an example of solar on a minute to minute basis.
These are just some of the sources of volatility that are straining the electrical generation, transmission and distribution system. Utilities cannot work with this level of variance. Power needs to be available when we turn on the switch whether or not there is some cloud cover in the desert or if the wind stops blowing.
Ed Cazalet, the VP and Co-Founder of MegaWatt Storage Farms believes that if California is to come close to achieving a 33 percent RPS by 2020, we are going to need at least 4 gigawatts of storage – or roughly 5 percent of the 75-gigawatts peak system demand. Cazalet is a former board member of the California Independent System Operator and the former chief executive officer and co-founder of Automated Power Exchange. I spoke with him before he presented at a recent SolarTech event.
MegaWatt, a startup with a very experienced team, looks to develop, own and operate large electricity storage facilities that connect directly to the wholesale electric grid and provide electricity storage services to utilities and other parties.
Stalled by Regulatory Agencies
But merchant owned storage – owned by the customer or independent parties is a "substantial regulatory challenge," according to Cazalet. Is it transmission? Generation? Distribution?
Like transmission, storage moves energy from one place to another with some losses. Is energy storage a transmission asset?
Storage competes with generation. Is is a generation asset?
Is it a distribution asset?
Or is it a fourth category?
The problem is, according to Cazalet, "If a utility doesn't know whether to call it transmission, distribution, or generation – they're not going to use it." And that debate is going on right now in the California PUC and at the FERC.
Storage Technologies
We have covered the variety of energy storage technologies many times at GTM. Here's a link to a related blog and an EPRI powerpoint discussing energy storage prices.
Some energy storage technologies:
- Compressed Air Energy Storage (CAES)
- Pumped Hydro
- Batteries
- Flow Batteries
- Flywheels
- Supercapacitors
- Superconducting Magnetic Energy Storage (SMES)
- Thermal Storage
Each of the technologies has its' virtues, its' drawbacks, and its' suitable niches.
Although Cazalet is agnostic on the specific storage technology he does seem to like Soldium Sulfur (NaS) batteries.
"Japan is way ahead of us in storage, Japan has over 300MW of storage, much of it NaS, on the grid," said Cazalet. This includes 34 megawatts on an acre at a Japanese wind farm in their quest to find energy storage at its lowest price. Some of Japan's NaS batteries have operated for over a decade. NaS is also being deployed at scale in the MidEast and has been deployed at scale on the distribution grid in the U.S. by utility American Electric Power.
With regards to Flow Batteries: "Many firms going after it, you have to get the engineering right. Not yet up to multi-MW scale," he said.
And, "Li-ion is making vast strides." with "trailer size installations providing 2 megawatts for 15 minutes."
How Does California Meet the 33% Renewables Target?
Cazalet's answer: "Put the storage near the load centers and deliver it on peak;" and, "Combine that with dynamic pricing."
Cazalet adds in a recent editorial:
Battery storage has no air, water, or noise emissions. Four gigawatts of distributed storage will provide 8 gigawatts of dispatchability (4-gigawatts charge rate plus 4-gigawatts discharge rate) to integrate variable wind and solar. Batteries can respond almost instantly over their full range of dispatchability.
Four gigawatts of distributed storage can also absorb 4 gigawatts of nighttime over-generation from wind and other sources, bringing it to the load centers at night on existing transmission, and then delivering it during the day when we need it.
He emphasizes, "Distributed storage is the only practical, large-scale and clean option for integrating a 33 percent variable renewable energy portfolio." And adds, "It is now up to California’s PUC, Energy Commission, ISO, and perhaps the Legislature, to establish a portfolio standard for storage to complement the standards they have set for renewables and demand response."
(GTM Research just published a new report on grid-scale energy storage).
