Dispatches from San Diego, pt. 4

This is part four in a series on our trip to San Diego for the Energy Storage North America conference and expo. Here are parts onetwo and three.

It’s a long flight from Beijing to California, so it’s not every day that our Chinese members have the opportunity to visit demonstration projects in the United States. We wanted to make the most of our San Diego trip, and so scheduled a trip to Borrego Springs, a community two hours away hosting a 26 megawatt solar facility and a 4.5 MWh lithium-ion battery energy storage system owned and operated by San Diego Gas & Electric. The batteries were provided and installed by Saft, with PCS from Parker and ABB.

The microgrid was funded in part by the Department of Energy and the California Energy Commission to build energy resilience in a remote community within California’s largest state park. The community’s population fluctuates between 2,500 and 10,000 residents, causing seasonal swings in load. Most importantly, the community is served by only a single transmission line strung in rugged terrain, leaving the community vulnerable to prolonged outages due to fire, lightning strikes, or floods.  

The microgrid has already proven itself as a powerful back-up system. During a planned transmission maintenance outage in May, the utility was able to switch customers to microgrid-supplied power after only a 10-minute outage. According to Jeff Mucha, project manager at SDG&E, that outage length was necessary to maintain personnel safety while flipping switches manually. The company is currently installing automation systems to make it possible to control microgrid services from SDG&E headquarters in San Diego.

This facility demonstrates the myriad values that microgrids can provide. In many ways, it was the ideal bookend to a trip that began with a visit to UC San Diego’s microgrid. One site was a telescope looking at the future technologies and business models that can help achieve grid stability and reduced carbon emissions in an urban, EV-heavy setting. The other, by contrast, showed how microgrids and energy storage can build resilience in isolated communities with plentiful solar resources.

Big thanks to Jeff Mucha and Donna Miyasako-Blanco at SDG&E, and Linda Haddock at the Borrego Springs Chamber of Commerce.

This is the final part of our blog, Dispatches from San Diego. See parts one, two, and three.

Dispatches from San Diego, pt. 3

This is part three in a series on our trip to San Diego for the Energy Storage North America conference and expo. If you haven't yet, check out parts one and two.

Today was the last day of the Energy Storage North America conference. Today's themes were grid services, finance, and technologies. We heard from grid regulators, policymakers, and technical experts, including Dr. Imre Gyuk, Energy Storage Program Manager at the Department of Energy.

Distributed Storage at the Market Edge

A morning panel featuring California policymakers focused on how distributed storage can interface in electricity markets.

The panel noted that utilities were tasked with examining the value of energy storage on their grids. At the time, utilities came back saying that the technologies were mature, economical, or proven enough for widespread use. Five years later, we’re seeing thousands of megawatts of interconnection requests for distributed storage, reflecting the effectiveness of California’s subsidies and the growing value propositions of these technologies.

During the Q&A session, a representative from Trina Solar, asked how policies can help China manage the problem of having long distances and constrained transmission between renewable generation and load centers. The simple answer given was to build more power lines. But the panelists also stressed the importance of building a diversified renewable asset base.

In a later panel, two grid experts continued the conversation about the role distributed energy storage can play on the grid edge.

James Gallagher, executive director of the New York State Smart Grid Consortium, described how New York’s Reforming the Energy Vision (REV) program is trying to better align utility practices with the goal of integrating more grid edge resources. Because New York has the oldest electrical grid in the country, REV also aims to help deal with the challenges of using older grid assets.

To do this, he said, REV is helping utilities procure distributed assets to meet their operational needs. The plan intends to introduce further market mechanisms to incentivize deployment. For example, the cost of electricity distribution is averaged across a utility’s consumer base, but in reality, the actual cost of delivery may vary by a factor of a hundred. Clarifying the actual costs of running a distribution grid gives third parties an opportunity to make a profit by introducing distributed resources like storage to locations where it is needed most.

He also touched on the issue of financing. Because increasing ratepayer fees to finance upgrades can be hard for utilities, there is an opportunity for microgrid players, who can raise money from third party sources to build and operate assets which traditionally were owned and operated by utilities. He also noted that insurance companies are becoming aware that record storms and heat waves driven by climate change are going to put community resilience to the test. Insurance companies have access to big pools of money that can finance power system upgrades, including energy storage, that build resilience in the face of global warming.

Technologies and Standards

Dr. Imre Gyuk, Energy Storage Program Manager at the US Department of Energy, gave a presentation on new technological breakthroughs in energy storage and efforts to establish better codes, standards, and regulations affecting energy storage system safety.

He highlighted work being done in energy storage at several national laboratories. Pacific Northwest National Laboratory (PNNL) has made breakthroughs in mixed acid vanadium redox flow batteries by developing electrolyte with 80% improved temperature stability and 70% better energy density. This technology has been licensed out to several big flow battery producers, including UniEnergy, Imergy, and WattJoule.

He foresees the system cost for vanadium redox flow batteries (RFB) to fall from $325/kWh in 2015 to $275 by 2017. He also shared projections that aqueous soluble organic flow batteries will become commercially viable in the medium term, with projected system costs falling to $150/kWh by 2021.

The Department of Energy is also working to resolve energy storage safety issues. The Department has published an inventory of codes and standards to help industry players better design, install, and operate their technology. The document also provides a list of best practices to respond to incidents involving energy storage technology.

The conference finished off with free beer at a reception at the San Diego Convention Center. It struck us how large this event is – a signal that the industry is really picking up speed, especially in the United States. This year, there were over 1800 attendees, 110 exhibitors, and over 150 speakers. We’re happy to have come – we’ll certainly be back next year.

Our fourth and final part in this series takes us to Borrego Springs, where SDG&E is pioneering microgrids and solar power to bring energy resilience to an isolated community in the desert.

Dispatches from San Diego, pt. 2

This is part two in a series on our trip to San Diego for the Energy Storage North America Conference and Expo. If you haven't yet, check out part one.

The first day of the expo and conference featured our debut on the conference floor, and discussions about California's massive storage procurement and the future of solar storage.

Sharing What We Know…

Vivian Wei, director of member services, and I made the final touches CNESA’s booth on day one of the expo. We’re here to share information about our efforts to promote energy storage policies and technologies in China. CNESA member companies we saw in the crowd included Primus Power, Schneider Electric, NGK, Sifang, Today Energy, ENN Group, Parker, Trina Solar, Sumitomo Electric, Imergy, Saft, ABB, GE and more.

The expo was a great opportunity for manufacturers, integrators and other energy storage players to share their technologies and business models with potential customers. For industry associations like CNESA, this is a chance to show the world what we do, and bring new members into the fold.

…And Learning from the Experts

Conference sessions also began today, focusing on three themes: distributed energy, hot markets, and utility-scale storage.

In a utility session, representatives from California’s three largest utilities discussed what lessons can be learned from their procurement of 350+ MW of energy storage capacity. Although the representatives were in consensus that their energy storage portfolios should be diverse, commercially sustainable, and flexible, questions posed in the Q&A segment about how utilities value different energy storage technologies, both now and in the future, were left largely unanswered.

Utility representatives said that their procurement requirement standards are expected to rise in 2016, which suggests that Chinese and other international companies should find suitable and experienced local partners if they intend to bid their products into California’s electricity markets.

In a distributed energy session, three industry experts from different backgrounds looked ahead at opportunities for solar-plus-storage. The panel featured Boris von Bormann, CEO of German battery business Sonnenbatterie; Ruud Kempener, analyst at the International Renewable Energy Agency (IRENA); and Barbara Lockwood, general manager at a US utility, Arizona Public Service.

Ruud Kempener challenged industry watchers to expand their perspectives beyond large-scale projects in developed countries, and consider the market possibilities for small-scale solar-plus-storage projects in countries with unstable grids and low rates of electrification. He remarked that although the cost of solar-plus-storage systems are often still too high to be considered cost competitive, they hold great value by providing grid reliability and resilience. Nonetheless, in the United States and Europe, cost competitiveness is still the most critical factor for the success of solar-storage projects.

Barbara Lockwood described how her utility is restructuring rates to encourage smart energy decisions. She argued that net metering – which reduces electricity bills for solar customers by subtracting total electricity produced from the electricity consumed from the grid – doesn’t accurately reflect the cost of electricity at various times, and discourages the adoption of technologies which can help utilities keep the grid stable. Solar panels cease to produce electricity at sundown, but load remains high well into the evening. In areas with high solar penetration, this means that utilities have to quickly ramp up generation in ways which can be costly and inefficient. Lockwood claimed that new rate structures, such as demand rates – which charge a consumer a separate fee based on the level of their peak consumption during a month or year – can encourage the use of energy storage technologies to even out load spikes which can cause instability and inefficiency in the grid.

Our trip blog continues in part three, where we hear from experts on distributed storage and breakthrough technologies.