by Julian Spector
December 01, 2017

The storage industry did not rest for Thanksgiving. 

Instead, halfway across the world from its headquarters, Tesla completed its 100-megawatt/129-megawatt-hour battery in time for Elon Musk's 100-day gamble. With that, the era of energy storage superprojects has officially begun.

The industry has now taken on two major grid crises -- and delivered. A year ago, the Aliso Canyon procurements had barely begun. Those batteries delivered in six months and helped California's grid avoid potential blackouts during the summer peak season. 

Now Tesla has stepped in to shore up South Australia's grid after two widespread blackouts. The system is short on duration, but has record-breaking power capacity. It can deliver short-term power during a grid shortfall to carry the load until backup generation ramps up.

The success of these projects means storage won't be stuffed back in the bottle. It's now public record that the industry's foremost practitioners can deliver on timescales that would be unthinkable for any other heavy grid equipment. As the Puente gas plant case shows, this knowledge has begun to filter into regulatory evaluation of traditional assets that wouldn't have been questioned a few years ago.

The question for the industry is whether these mega-projects offer a sustainable source of business, or will their impact be more limited and symbolic? How many massive projects with ambitious timelines can storage developers jump on?

Here's what Ravi Manghani, energy storage director at GTM Research, told me on that count.

"You cannot have a business model that's just waiting for these events to occur so you can jump in and be a savior," he said. But, he added, "They've had two such projects done in the last year, so there is some amount of regularity to these emergency events."

There will be more unexpected grid failures and more natural disasters. Storage providers may do well to prepare for large-scale rapid response. 

But it won't work everywhere. California and South Australia have rapidly modernizing grids, and policymakers there have already been studying where to go next. A massive accelerated battery deployment only works if there's a solid foundation to build upon. 

Plenty abroad, scarcity at home

If there's a downside to these mega-projects, it's that they are drawing resources and attention away from the bread-and-butter storage installations that make up the normal flow of business. 

When it's not supplying the biggest battery on earth, Tesla also sells to a range of smaller-scale installers and developers whose residential and commercial customers clamor for the brand.

The thing is, Tesla's had trouble delivering on time, as I reported here. The delays can't be attributed entirely to Australia and the company's efforts in Puerto Rico post-hurricane, but those projects certainly pulled away resources. Battery supply chains are still nascent, and Tesla has managed to stoke more demand than it can readily deliver on.

From a high-level corporate view, there's a case to be made for prioritizing big projects that capture attention and move a lot of units all at once. Over time, though, residential and commercial are expected to gain market share from utility-scale, and they need a steadier flow of supplies.

That could come from the Gigafactory revving up further, or from new entrants producing competitive products that consumers want. The danger of a market where one vendor wields considerable pull is that any disruption to its deliveries, intentional or otherwise, ripples out to affect many other parts of the industry.

Storage Summit, here we come!

I would be remiss not to remind you that GTM's Energy Storage Summit is right around the corner, on Dec. 12-13 in San Francisco.

I'll be there to moderate panels on what makes a successful state pilot and whether lithium-ion's market dominance is a good thing for the industry. If you spot me (see the Storage+ lead image for reference), please come over and say hello; I enjoy connecting with our readers and nerding out on storage in person.

And if you haven't booked yet, promo code SQUARED will get you $200 off registration. Cheers!

New York Governor finally signed that storage target

For the storage companies that have been staring hungrily at the ripe orchard of the Big Apple, prepare to feast.

After five whole months of waiting, Governor Andrew Cuomo decided to sign the bill to create a storage target that the legislature unanimously passed in June.

If five months seems like a long time to approve something desired by every single legislator in the state, well, yes it is. Cuomo enthusiastically embraced a mandate for renewable energy, but his administration has been publicly hesitant to embrace storage in the same way.

In their view, a target for storage would be more like picking a winning technology than mandating clean energy was. But something changed, and the governor came around to seeing this bill as something he could get behind.

The actual impact of it won't be felt for some time. The Public Service Commission is charged with setting the target for the year 2030, which is ages away in storage years. It could feasibly produce no activity for a decade, unless it has checkpoints built in along the way.

But other efforts are in motion. There's a storage roadmap in the works that will form the analytical foundation for the effort. And state agencies will have to develop a program to help implement the target. 

For its part, this industry tends to argue that if the market actually priced the values it provides, there would be no need for mandates or incentives. New York's grid overhaul hasn't produced any working storage tariffs yet, but perhaps this law will hasten their arrival. 

Floating batteries?

Younicos will supply a 1-megawatt/1.3-megawatt-hour system to the Hywind floating wind project in Scotland. The company claims this is the first battery to be interconnected to floating wind, and it will be operational in Q2 2018.

Before you get too excited, I should mention that the battery itself won't be floating on the high seas -- it has a home in a nearby substation onshore. But it will be storing power from the offshore wind farm developed by Statoil and Masdar, to find ways to make that energy more valuable.

The best part about this project may be its name: Batwind, the hero Hywind needs and deserves. 

Puerto Rico storage continues to grow

It's hard to keep track of all the cleantech companies sending equipment to Puerto Rico, but here are a few recent updates.

German storage company Sonnen and local distributor Pura Energia have donated and installed six microgrids at key community sites across the island, with nine more planned for the near future. Long-term, the company envisions building out a networked community of homes with solar and storage, as it has built in Germany and will build in Arizona.

Sunrun has completed solar-plus-storage installations on two fire stations to power emergency services, and has committed to a total of eight. That's in partnership with Empowered By Light and local construction firm Aireko Energy Group.

AES has proposed a grid redesign featuring "a network of connected minigrids, reinforced by key transmission and distribution lines and powered by 10,000 megawatts of large-scale solar and 2,500 megawatts of 10-hour battery-based energy storage."

The power company has experience in Puerto Rico, supplying 15 percent of its electricity. It thinks the minigrids provide a cheaper alternative to the fuel costs associated with operating the current fleet of fossil-fueled generators. That's a bold claim that will need to be checked out, but it holds promise: Island markets have been a hotbed of solar-plus-storage development as it displaces imported diesel.

The minigrid concept pairs the resilience of a localized grid with the flexibility that comes from exporting and importing to neighboring grid regions. Grid futurists have discussed interconnected microgrids, but few pilots have put the concept into practice. Now Puerto Rico could pioneer the concept.