Everybody's talking about solar-plus-storage, even if there aren't many operational projects deployed yet to fully demonstrate the value proposition.
I've been looking for a good explanation for that on-paper versus in-the-ground discrepancy, and I got one this week from Scott Rackey, the head of PV-plus-storage development at First Solar.
That company, which has the largest base of contracted and installed PV capacity in the country, has moved into storage in a big way. The term of choice in that shop, by the way, is "PVS," which eliminates the cumbersome hyphenations of "solar-plus-storage."
First Solar now routinely permits new western developments for the potential inclusion of storage, because customers ask for it so frequently that it's better to just file the paperwork ahead of time.
"It’s really become cost-effective in roughly the last year or year and a half for dispatchable PV," Rackey told me. "Utility-scale is where these can be cost-effective, and big plants have long lead times."
In his estimation, then, it makes perfect sense that there's a mismatch between what looks good on paper and what we see being built. The storage-paired projects that finally pencil out haven't started coming on-line yet. In two or three years, it should be a very different story.
We got a little taste of that future this week with a hybrid plant NextEra Energy Resources will build for Tucson Electric Power by 2019. That plant pairs 100 megawatts of solar generation with a 30-megawatt/120-megawatt-hour storage system at a PPA price that Utility Dive reported as "less than $0.045 per kilowatt-hour."
That's a startling improvement on the previous solar-plus-storage standard-bearer, the AES project in Kauai for $0.11 per kilowatt-hour. Island grids have long been the bastion of solar-plus-storage, but now highly competitive deals are washing ashore.
Battery lessons: Don't underestimate the complexity of communications
Readers got to vicariously join in on some battery tourism I conducted outside of Phoenix recently to see the new AES test batteries that went up on a solar-heavy distribution feeder.
Arizona Public Service's approach here should yield some valuable insights. The utility put identical 2-megawatt batteries at the substation and halfway down the feeder, to test how location affects the performance of grid services. The project also sets a baseline for grid-scale battery performance in the Arizona heat.
The experience so far has helped crystallize a challenge inherent in the new wave of battery technologies: all these "smart" machines are only as good as their point of connection with the grid operations systems, just as smartphones are only as useful as their Wi-Fi connection or cell signal.
"We have to be able to know what it's doing and when it's doing it, and if we want to make it change to do something else, we have to be able to communicate," said project manager John Pinho. "If anything fails in the linkage that's required for all this communication, then the system can't necessarily do what you want it to do."
Experience so far has shown that cell tower infrastructure doesn't guarantee the kind of seamless connectivity that the grid demands. This has very real implications for the design of future battery projects: APS substations have a fiber-optic hookup, so batteries co-located there will be fine, but as storage starts going into more remote locations to shore up T&D infrastructure, for instance, additional communications infrastructure may be required.
And stay tuned for the winner of APS' RFP for a 2-megawatt/8-megawatt-hour battery to be sited in the rural town of Punkin Center, northeast of Phoenix. APS determined that energy storage penciled out as a more cost-effective alternative than replacing 20 miles of electricity lines. This isn't a test; it's a full-blown non-wires alternative.
Austin Energy says howdy to Stem, Younicos
The funky Texas town is lining up for something besides tasty barbecue. Municipal utility Austin Energy has locked in deals with both Stem and Younicos to provide distributed energy storage as part of a DOE-funded solar integration demo. Since topical acronyms are a prerequisite for DOE disbursements, this one goes by the moniker "SHINES" (Sustainable and Holistic Integration of Energy Storage and Solar PV).
Stem is approaching this through its model of distributed, commercial business-sited storage, which cuts the host's demand charges and offers the utility an aggregated network of grid assets. This marks Stem's eighth utility contract and its first entry into the Texas market.
Stem will work with the muni to identify seven commercial sites in the east Austin neighborhood, which will have batteries up and running in 2018.
Texas lacks the robust policy support for storage that California enjoys, but the SHINES grant created an opportunity to demonstrate the business model in the new market.
"SHINES has helped us in other areas before that have grown into bigger markets," said Stem CEO John Carrington. "When we get in a new location and prove the model, it just starts to grow."
Younicos' 1.75-megawatt/3.2-megawatt-hour procurement will be the company's largest deployment in the U.S. to date. The seven Y.Cube storage units will fan out across east Austin to help balance the grid in the midst of high distributed PV penetration.
It's noteworthy that a municipal utility is breaking open these opportunities for storage in Texas. Fellow munis around the country have led the way on innovative storage deployments, as seen in Sterling, Massachusetts and Minster, Ohio. These local utilities have nimbler decision-making processes and answer to their customers, rather than distant shareholders, which can clear the way for grid experiments if they meet the city's needs.
Austin Energy is chasing 55 percent renewable energy by 2025, so energy storage may well be vital to achieving its goals.
Engie snaps up Sungevity's European business
The saga of former top-five residential installer Sungevity's decline continues, with a new character.
French utility Engie added Sungevity's European operation to its collection of shiny grid edge investments. Engie already owns an 80 percent stake in behind-the-meter storage company Green Charge Networks, with other stakes in solar development, EV charging and DER software systems.
We don't know what's in store for the stranded subsidiary, but with Engie's backing it could become a delivery mechanism for a range of distributed energy assets to European homes. Perhaps a rebranding is in order, though; I would be remiss not to propose the portmanteau "Engevity."
Tepco buys an Ohio battery
When I spoke with an executive from Tokyo Electric Power Company last month, he told me the company was looking at grid edge and storage investments as a path forward after the Fukushima nuclear disaster.
"In order to recoup the massive amount of compensation for the nuclear damage, we have to find out other sources of revenue to shift from the traditional type of business to new business opportunities," said Shinichiro Kengaku, managing executive officer and chief of the New Growth Task Force.
This week we saw evidence of this: Tepco is going to buy a 50 percent stake in the Battery Utility of Ohio, which owns and runs a 4-megawatt battery unit. The seller is Renewable Energy Systems Americas.
Japan is restructuring its electricity markets in a way that could open up more storage business there; in the meantime, Tepco will dip its toes in the U.S. market and see what it can learn.
BMW zooms into solar-plus-wind
Swedish state-owned energy company Vattenfall brought BMW on board to store energy produced at its largest wind farm in Great Britain.
The deal will put approximately 33 megawatt-hours of BMW batteries onsite at the 228-megawatt Pen y Cymoedd wind farm in Wales, Energy Storage News reported. The batteries are expected to begin operations in February and serve the grid reliability function known as enhanced frequency response in the U.K. The two companies had previously signed a deal to install batteries at the Princess Alexia wind farm near Amsterdam.
BMW, like Tesla and Mercedes-Benz, has spun off its electric-car battery production into a side business in stationary storage. These BMW installations are much bigger than a typical grid-scale pilot project, which speaks well of BMW. The pairing with wind has not been extensively tapped before, and could grow into a lucrative market as European wind penetration increases.