January 7 (Renewables Now) – Canada’s Innergex Renewable Energy Inc (TSE:INE) confirmed it has sealed power purchase agreements (PPAs) for two solar-plus battery projects on the Hawaiian islands with a combined photovoltaic (PV) capacity of 45 MW.

The deals with the Hawai’i Electric Light Company and the Maui Electric Company are for the Hale Kuawehi and Paeahu schemes, both of which are scheduled for completion in 2022, Innergex said on Friday. Located on Hawaii island, the 30-MW Hale Kuawehi PV park will be able to produce an average of 92,000 MWh of electricity per year and will incorporate 120 MWh of battery storage capacity. The Paeahu solar plant, with a capacity of 15 MW, will be set up in Maui and will have a 60-MWh energy storage system. Its average annual output will be around 45,000 MWh.

The PPAs have been filed for review with the Hawaii Public Utilities Commission (PUC), Innergex said. It explained that the contracts are for dispatchable power, which will help maintain the grid stability on the two islands.

The two projects mark the Canadian firm’s foray into the energy storage sector. Its president and CEO Michel Letellier said: “With these two important and unique projects in Hawai’i, we are excited to enter the growing and promising battery energy storage market, in which we intend to become a key player.”

While market opportunities for energy storage in Texas are considered to be limited, the largest battery project in the state so far, a 42MWh system, has just come online.

Texas has no capacity market payment mechanism, utilities are not allowed to own storage due to competition rules as it is still classed as a generation source and as early as March this year, analysts were saying that frequency response markets for the state’s main network operator, ERCOT, are rapidly reaching its maximum cap.

Thus far, the state has deployed a large amount of wind power generation and some batteries have been deployed at wind farms to limit the curtailment of the generators’ excess energy. However, integrated power company Vistra Energy, identified that some niche opportunities exist to use batteries for the integration of solar energy, while also seeing a half-formed business case for energy arbitrage, charging batteries cheaply with off-peak grid power or renewables.

Located at the 180MW Upton 2 solar plant, West Texas, Vistra Energy’s subsidiary Luminant delivered a 10MW / 42MWh lithium-ion battery system. Upton 2 is capable of generating 200MW during peak solar production hours and the batteries allow some of that extra generation to be captured and then discharged during peak times. The batteries can also be charged with off-peak power from the grid at night, which again can be resold at higher prices when demand has risen. In Texas that’s also likely to include a proportion of wind power, Vistra said. A recent 10MWh project announced by RES (Renewable Energy Systems) for utility CPS Energy also serves a similar purpose.

An investor’s note: “Batteries, renewables and electrification of transport” published by Vistra during 2018 shows that the company identified opportunities across a number of service areas of major US transmission network operators, including California’s CAISO, the New York NYISO, Texas’ ERCOT and PJM across 12 states in the Mid-West.

Of all the strange things we do as a race on this planet, refining and over-complicating things are some of them. We’re never satisfied with letting things be and often time favor extravagant conspiracy theories over reality. After all, how would the opposing piston engine and the convoluted internal combustion engine system have worked until now otherwise? Even though it has brought us this far, we need to get rid of inefficiency for more effective solar thermal energy storage systems.

So, How About Turning Sunshine Into Liquid Fuel For Solar Thermal Energy Storage?

The thought of turning sunshine into liquid fuel might sound like a step back, but hear me out. The solar thermal energy storage system I’m referencing uses a liquid isomer to store and release solar energy. The discovery could lead to more widespread use of solar energy throughout the world, according to the researchers behind it.

According to BigThink, Swedish scientists from the Chalmers University of Technology figured out that using a norbornadiene compound that reacts to sunlight has some potential in this regard. It rearranges its carbon, hydrogen, and nitrogen atoms, which can be stored in an energy-storing isomer called a quadricyclane. Quadricyclanes hold up to 250 watt-hours of energy per kilogram, even after cooling down for a long time. And they doesn’t break down after being recycles.

One of the biggest energy problems for northern and southern countries is with the harvesting and storing of their vast solar energy. These countries have made great strides with hydro and thermal energy systems, but solar thermal energy storage is still a developing field. By using a cobalt-based catalyst, the energy is released as heat, much like how concentrated solar molten salt tanks work. This makes solar energy transportable and a contender for on-demand energy needs.

Denmark’s largest energy company Orsted – formerly known as DONG Energy – has announced the completion of its first large-scale grid-connected energy storage project, a 20MW standalone battery system in Liverpool, England.

The project, Carnegie Road, sees batteries housed in three containers. The lithium battery and power conversion system have been supplied by NEC’s Energy Solutions division, headquartered in Massachusetts, USA. NEC’s Grid Storage Solution (GSS) is in place, with the two companies having worked together previously on the Bay State Wind project in Massachusetts. Energy-Storage.news reported on the project as it was first announced by Orsted in April last year.

As mentioned at the time, details on the applications the system will provide and the business model behind it have not been given, except that Carnegie Road will help to balance the grid through matching supply with demand, implying that some form of frequency response service will be delivered.

Orsted has already got one battery project in operation in the UK, a 2MW/2MWh behind-the-meter system delivered in partnership with ABB, but Carnegie Road marks its first foray into large-scale grid batteries. In late 2017, CEO Henrik Poulsen stated Orsted’s commitment to a transition to a low carbon, green and sustainable energy system and that his company was working to establish “a scalable commercial model” for solar PV and energy storage, viewing both as potential drivers of long-term growth.

“Our electricity consumption pattern is changing and is becoming less predictable as we use more electronic devices and electrify our transport system. The way we generate electricity is also changing as we add more low carbon sources from wind and solar to the grid,” Orsted’s Bridgit Hartland-Johnson said.

Luminant, a subsidiary of Vistra Energy, recently announced that its Upton 2 battery energy storage system project has finished construction and began operating Dec. 31, 2018.

The battery system, which is the largest energy storage project in Texas and seventh largest in the United States, is located on the site of Luminant’s 180-megawatt Upton 2 Solar Power Plant in Upton County, Texas.

The 10-MW/42-MWh lithium-ion energy storage system captures excess solar energy produced at during the day and can release the power in late afternoon and early evening, when energy demand in the Electric Reliability Council of Texas (ERCOT) area is highest. The battery system can also take advantage of low-priced grid power — during times of high wind output, for example — to charge the batteries to be available for higher demand periods.

Vistra is also currently developing the world’s largest battery energy storage project, the 300-MW/1,200-MWh storage system at its Moss Landing Power Plant in California, scheduled for commercial operations in the fourth quarter of 2020.

Other Texas Energy Initiatives
Texas has recently become a hotspot for renewable energy and energy storage projects. In October 2018, NestléWaters North America (NWNA), together with Engie Resources, announced that they signed a renewable energy agreement through which Engie will supply more than 50% of the energy needed for NWNA’s manufacturing and distribution facilities in Texas. With this agreement, NWNA operations in Travis, McLennan, Dallas, and Harris counties will be supplied by renewable wind energy from the Midway Wind Farm in San Patricio County, Texas, supporting Nestlé’s global goal to transition to 100% renewable energy use in its operations.

NWNA will use clean, renewable energy to produce sustainably-sourced beverage options for Texans, including the company’s Ozarka Brand Natural Spring Water and Nestlé Pure Life Purified Water. The agreement will include up to 70,500 renewable energy certificates (RECs) per year from Midway Wind LLC. Based on current electrical usage, by transitioning its electrical power needs to renewable sources, the carbon footprint from the company’s Texas factories will be reduced by more than 44,000 metric tons of CO2 equivalent per year.

And in May 2018, Texas A&M International University (TAMIU) announced it started construction on a comprehensive campus-wide energy efficiency project that will streamline facility operations, encourage sustainable behavior and improve the quality of life for students and staff. The university is partnering with energy and sustainability expert Schneider Electric on the project, which guarantees nearly $15 million in energy savings over the life of the project.

After another record-breaking year, in which the US surpassed 1GW of deployed energy storage and China began its programme of building flow batteries several hundred megawatts in size each, we canvassed opinion on what 2018’s biggest challenges and successes were. In doing so we also look ahead to what this year, 2019, will hold, from the strategies our industry will utilise to meet those big challenges and what the expected direction of travel will be in some of the world’s leading markets.

In this first part, we look at the challenges faced by the industry in 2018 and we’ll move on to those other aspects of energy storage in 2018-2019 and beyond in the coming instalments.

Lithium-ion cell supply

Physically getting hold of batteries for use in energy storage systems was a constraining factor in 2018 for many. Respondents Roger Lin, VP of marketing at the Energy Solutions division of NEC Corporation, said electricity policy in South Korea has “spurred an avalanche of local demand there, making it difficult to secure supply for other parts of the world,” and the only unaffected companies were those with long-term supply agreements in place. Karim Wazni, managing director of Aggreko (which bought up storage system integrator Younicos earlier this year) agreed that “the sourcing of lithium-ion cells” in particular was a supply chain challenge in 2018.

Policy uncertainty
Déjà vu for anyone making the sideways move into energy storage from the solar PV industry: politicians aren’t ever sure how to treat new technologies and environmentally-friendly energy sources are among the least understood.

Almost every one of our recipients said that while energy storage markets have grown significantly around the world, policy uncertainty remains one of the biggest challenges. Aggreko’s Karim Wazni said that rule changes have increased market risk and uncertainty – “particularly in the UK and in Germany”. NEC’s Roger Lin said that in the UK, changes to Capacity Market conditions and changes to grid services contracts and peak demand pricing mechanisms – still a work in progress – created “shifting market conditions” and uncertainty.

While a recent study said 10GW of energy storage by 2030 would offer overall benefit to Nevada, NV Energy will move forward with an Integrated Resource Plan: 1,000MW of renewables including 100MW of storage – by 2021.

NV Energy, a Nevada utility owned by billionaire investor Warren Buffet’s Berkshire Hathaway vehicle, serves around 1.2 million customers in north and south Nevada, with electricity, as well as millions more tourists.

Just before the Christmas Holiday period in the last two weeks of 2018, regulators in the US state approved NV Energy’s proposal, which had been tabled in June. The plan would double NV Energy’s renewables deployment by 2023, green-lit by the Nevada Public Utilities’ Commission (PUC). NV Energy confirmed in a release that the plan will entail US$2 billion of investment, creating 80 long-term jobs and 1,700 roles during construction.

By the time the projects are completed, expected during 2021, NV Energy would have 3,000MW of renewable energy resources in operation. Wholesale electricity costs are expected to fall as a consequence of the investment in clean energy. The plan includes six projects in the state, while the company also has out a 350MW request for proposals (RFP) for large-scale solar projects.

The utility, one of only two regulated public utilities serving retail customers in the state, already offers incentives for eligible homeowners and businesses to deploy home or commercial & industrial battery storage systems from 4kW to 1,000kW. Depending on system size, up to US$2,000 or US$3,000 could be applied for, with payments capped at US$1,000,000 for every step of the programme.

From a bigger picture perspective, it’s not quite what the energy storage industry might have hoped for in the best case scenario but is certainly a big step forward. A recent study by consultancy The Brattle Group (commissioned by the PUC) determined that certain levels of energy storage deployment: 200MW by 2020, 1,000MW by 2030, along with 40MW of behind-the-meter resources would give a net benefit for the state.

Electricity from 100MW of energy storage facilities will be purchased by US public utility company El Paso Electric, following a competitive solicitation process.

Headquartered in Texas and serving more than 400,000 customers in that state and in New Mexico, the utility determined that it required additional generation and energy management resources in place by the time the 2022 and 2023 summer peaks in electricity demand happen. The utility currently owns around 2,153MW of generation facilities.

El Paso Electric put out its 2017 “All Source Request for Proposals for Electric Power Supply and Load Management Resources” as a consequence, competitively tendering for both the construction of new projects including solar, storage and natural gas and for the purchase of power from third-party owned generation facilities.

Winning proposals remain subject to their obtaining required environmental and construction permits as well as gaining approval from the respective Public Utility Commission of Texas and New Mexico’s Public Regulation Commission. El Paso Electric said the projects chosen and the mix of diverse choices is in line with the need to deploy “cost-effective, diverse and competitive-based energy resources for its customers” in expanding its portfolio, as well as advancing a strategic goal to “remain at the forefront in advancing renewable energy”.

The utility selected:

200MW of utility-scale solar

100MW of energy storage

226MW new natural gas combustion turbine unit at existing power station

50MW to 150MW of wind and solar power purchases

The burgeoning as-a-service model, offering greater user flexibility and attractive economics, is now a viable option for energy storage. As with transportation, office equipment, and other capital-intensive assets, large-scale energy users both on and off the grid can leverage the benefits of battery storage on a use-only-what-you-need-when-you-need-it basis. What is the main driver behind this new offering? Flexibility.

Removing the Risks

There are several reasons why storage-as-a-service makes sense in today’s fast-evolving energy landscape. First, long-term ownership commitments may lead to stranded assets and tied-up capital (especially with relatively new technology). In certain cases, it might be better to rent a system and see if it proves valuable. Second, as-a-service solutions provide maximum flexibility when market conditions shift. For example, when regulations or the value of ancillary services change, users can more easily adapt. Third, rental customers can generally contract with one supplier who takes responsibility for system design, performance, and maintenance—a “one-stop shop.” These new approaches to system deployment offer a virtually risk-free, 100% reliable solution.

There are also compelling arguments for the as-a-service model that apply in particular to batteries. For example, potential customers may have concerns about battery life and whether their investment will be compromised. New technology is continually coming on the market, which could render their newly acquired asset obsolete. As with solar photovoltaic technology, there’s a perception that prices will continue to decline. Why buy now if it’ll be cheaper tomorrow? Faced with a purchase decision, these concerns can lead to hesitation, limiting a customer’s ability to capture energy storage benefits immediately. The more-flexible as-a-service alternative eliminates these risks.

A final point worth mentioning is that batteries typically have long lead times, ranging from nine to 18 months, depending on market conditions. Most established providers that offer storage-as-a-service have inventory available that can be delivered on short notice (typically less than three months), enabling customers to realize the benefits faster.

Convenient Contracts and Configurations

Storage-as-a-service contracts start with periods as short as a few months (although multi-year terms are far more economical). Typically, agreements are based on a regular monthly or annual fee. Terms can be easily adapted to fit changing business needs. Customers receive guaranteed 24/7 system reliability for zero asset investment and with low implementation costs, including 100% service coverage. All operations and maintenance costs, remote monitoring, performance guarantees, and warranties are covered under one contract and fee.

From both a regulatory and development perspective, 2018 was a significant year for the expansion of energy storage resources (ESRs). From a significant ruling of the Federal Energy Regulatory Commission (FERC), to the presentation and implementation of aggressive state initiatives, rapid ESR deployment continues unabated while ESR technology costs continue to decline precipitously.

Undeniably, ESRs have arrived as a credible, useful component of a resilient and efficient grid. This article explores common ESRs and how they contribute to grid stability, the FERC’s impact on the development of markets to compensate ESRs, and how states are playing a pivotal role in advancing the development of ESRs.

ESRs and the Grid
An electric storage resource is defined by FERC as “a resource capable of receiving electric energy from the grid and storing it for later injection of electricity back to the grid regardless of where the resource is located on the electrical system.” Common examples of ESRs include batteries, pumped storage facilities, and compressed air energy storage.

Because ESRs have the flexibility to consume or inject electricity, they can be used by grid operators and market administrators to balance supply and demand efficiently. Generally, grid operators identify the ability of ESRs to shift load as a consumer when load is low and as a supplier when load is high. ESRs can help manage peak demand, manage the integration of intermittent resources (such as solar and wind facilities), and defer distribution and transmission upgrades.

Because of their ability to store energy for later deployment, ESRs have the capability to mitigate demand during peak consumption periods. Additionally, because certain ESRs have the ability to ramp up and down rapidly in response to grid requirements, they are particularly useful in assisting grid operators in integrating increasing levels of intermittent, renewable sources of power.

Resources such as solar and wind do not have defined production patterns, and often they need to be curtailed for economic reasons. ESRs have the capability to flatten the production curve for such resources, thereby enhancing grid reliability.

Finally, ESRs can help operators manage transmission congestion. Grid operators are often confronted by congestion in areas of the grid that lack sufficient transmission infrastructure, particularly during peak periods. During such periods, lower-cost resources may not be able to be dispatched to serve load. ESRs strategically located on the uncongeste