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Falling Prices and Other Factors Point Toward Electric Storage Popularity

Randy Sukow Aug 16, 2017

Interest in alternative energy is growing and so is the list of reasons why electric cooperatives should consider electric storage technology. Mainly, because the cost of batteries is dropping. At the same time, electric utilities are finding that battery systems offer ways to improve reliability and other operational elements.

NRTC and SoCore, its solar technology partner, have been investigating possible storage solutions for more than a year.  “I think before the end of the year, we will have our first storage announcement,” said Brad Seibert, NRTC’s VP of Next-Generation Energy.

Battery prices today are below $500 per megawatt hour and falling. That is about half the cost of storage compared to two years ago. It is decreasing mainly due to economies of scale. “Greater scale and process improvements are what’s driving this,” Seibert said. There is growing interest in batteries, partly due to Tesla and that company’s progress promoting storage for electric cars and other system," he said.

Another reason to invest in storage now is to take advantage of the federal investment tax credit (ITC) for solar energy projects. Under current law, co-ops can be eligible for 30 percent credit on projects that begin before Dec. 31, 2019. The same credit applies to storage systems, if the systems store solar-generated power. For those planning solar projects based on the ITC, “It becomes difficult to separate solar and storage,” Seibert said. “It becomes easier to procure it as a package.”

The GridWise Alliance, a consortium of electric utilities and equipment vendors, recently published a white paper, “Advancing Batteries to Enhance the Electric Grid,” listing several additional benefits of investment in battery solutions:

  • Scalability.  Utilities can build energy storage in small spaces in comparatively short time frames. “The modular design of storage installations enables sizing the project so that they can be built and configured to meet the exact system need. Such ‘plug-and-play’ capability also simplifies adding capacity increments as needed,” the white paper finds.
     
  • Line Loss Reduction. Segments of the grid experience line loss as electric energy converts to heat energy at a proportional rate. The amount of line loss tends to increase during peak hours when the cost of energy is highest. Utilities that discharge batteries during those periods and charge them during lower-demand periods could see net line loss reduction.
     
  • Reliability. Extreme shifts in the levels of electricity supply and demand put stress on grid equipment. “Given their unique ability to charge and discharge power rapidly, batteries can provide vital ancillary services to help stabilize the grid at the 60 MHz frequency required to operate the grid reliably,” the white paper says. “Such ancillary services include frequency regulation to maintain alternating electric current cycle rates, operating reserves to provide power on short notice to satisfy short term demand increases, and voltage support to stabilize the level of current customers receive.”
     
  • Disaster Recovery. When weather conditions cause outages to several parts of the grid, the white paper suggests using “strategically placed batteries” throughout the system to ensure that critical facilities and services continue to receive power in the short term. During longer-term outages, batteries can help utilities balance rapidly shifting load changes and reduce wear and tear on solar generation equipment.

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