On the site of an old coal mine in Belgium's only national park, Centrica Business Solutions’ flexibility provider REstore has launched a 32-megawatt virtual power plant, with a distribution-grid-connected 18.2-megawatt Tesla Powerpack storage system.
The project took six months from inception to operation; the battery installation took about five weeks. The virtual power plant (VPP) has been providing primary frequency regulation to the Belgian transmission system operator since April 2018 and stacking value with additional participation in the real-time balancing market.
Frequency regulation is traditionally provided by conventional generators. Here, the majority is being provided by battery flexibility. And it's the intelligence of the software that's making money for all of the portfolio providers in a market that is seeing declining prices.
In the world of grid edge technologies, this project is a big deal.
"100 times faster than fossil fuel plants"
The 32-megawatt VPP is managed and bid into the market by REstore’s FlexPond patented technology, ensuring the provision of bidirectional flexibility. These megawatts are symmetric and can go up and down depending on the system needs. The VPP portfolio is dominated by Tesla's 18.2-megawatt, 22-megawatt-hour battery system.
In a tweet, Tesla noted that the 140 Powerpacks are “balancing the European electrical grid 100 times faster than fossil fuel plants.”
The system currently provides rapid power in response to system frequency. It can also offer longer-duration, more energy-intensive service for longer deviations in system frequency through coordinated control of a pool of commercial and industrial customer assets. Although the VPP stands at 32 megawatts, REstore can add more C&I load and distributed resources to grow the portfolio in the future.
REstore will be bidding the battery flexibility into the now coupled Primary Control Reserve (PCR) market of Belgium, Denmark, the Netherlands, Austria, Switzerland, Germany and France, for duration contracts of up to one week. Frequency control traditionally has been provided by conventional generation, but this is evolving under the PCR market, which is similar to PJM’s Regulation D signal stimulating participation from nontraditional resources, such as battery storage. The PCR market is currently around 1,400 megawatts.
Terhills Tesla Powerwall Frequency Control
GTM Research expects to see more European storage projects enter this market, following the trend in other nascent markets and driving clearing prices down. This trend of market saturation was also observed by GTM Research in the PJM regulation market in recent years. That means it will be more important than ever for participants to be able to maximize value, by bidding in innovative and even complementary bids such as REstore's VPP offering backed by a critical volume of energy storage.
REstore claims the technology automatically trades energy on the wholesale market, without any negative impact on its performance and revenues for the provision of the frequency regulation service to maximize investor returns. “What makes this battery project unique is its inclusion in a larger flexibility portfolio, which results into a 1.5 times higher revenue stream for the battery, compared to the base case where the battery is monetized on a standalone basis,” stated Jan-Willem Rombouts, co-CEO of REstore.
The scalable VPP has the Tesla battery as the backbone and the secret sauce of REstore’s software to provide viable frequency services to the transmission system operator, and it maximizes returns from market participation for all parties seeking revenues as part of the portfolio.
Investing for the future
Investment firm LRM put 11 million euros into the Belgian storage project. LRM was one of the lead investors in REstore before the Centrica acquisition and is co-owned by the Flemish government.
The battery is only the start of grid edge investments at Terhills Resort, located on a former mining site. Terhills is planned to be an eco-resort, with a full direct current microgrid comprising a fleet of electric transport, supplied by solar PV generation, and complemented by the 18-megawatt energy storage system. The objective is to turn a site that was built on the "old black stuff" into a green innovative hub.