September 17, 2015

Why Storing Solar Energy at Night is Closer Than You Think

Published by the Washington Post on September 16, 2015. Written by Chris Mooney

In May, when Tesla Motors announced its new battery product to vast media buzz, the talk was all about people putting batteries in their solar-powered homes, and thereby becoming that much less reliant on the grid.

But there was always another and perhaps even bigger side of the story — the idea that very large scale batteries or battery packs could help out the grid itself by storing large amounts of solar energy for use in the evening or at night. The ultimate effect might be to displace electricity generated from coal or natural gas, and convert an inherently “intermittent” renewable energy source — solar — into a more constant one.

So is it happening? The answer seems to be yes — 2015 has seen several key announced, completed, or experimental grid-scale projects pairing batteries and solar photovoltaic panels.

“In the last few months we’ve seen the frequency of these project announcements go up,” says Ravi Manghani, an energy storage analyst with GTM Research. Manghani adds that while there have been pioneering initiatives and pilot projects prior to now, it does appear that this solar plus storage technology is beginning to arrive.

[Solar energy is growing very, very fast. It’s just still not fast enough]

Indeed, SolarCity — which is chaired by Tesla CEO Elon Musk — has just announced plans to bring precisely this combo to Hawaii, a state that continues to lead the way when it comes to the adoption of solar and batteries, thanks to its towering electricity costs, which are the highest in the nation.

SolarCity and the Kauaʻi Island Utility Cooperative jointly announced last week that they’ve entered into a solar power purchase agreement in which SolarCity will provide 20 years of power from a 52-megawatt-hour battery installation that will be able to send as many as 13 megawatts of electricity to the island’s grid. The battery will draw power from an accompanying solar array.

The biggest news is when the energy would be supplied: the evening. “What makes this exciting is basically that it’s dispatchable solar that will be available at night,” says Peter Rive, the chief technology officer of SolarCity. The system is slated to be running by the end of 2016, said Rive, and will likely use Tesla batteries for the energy storage component.

Once that happens, solar energy will be no longer confined to simply being used when the sun is shining, at least on Kaua’i. Rather, thanks to storage, its use will be shifted to other hours of the day — removing one reason that power plants have often been powered by various types of fossil fuels (on Kaua’i, diesel), which of course can burn at any hour.

Hawaii came first for the obvious reason: cost. “You always see these technologies being adopted there first, due to the high price of energy,” Rive says. “But we expect the price declines to continue in a way that this will be feasible here in the near future.”

SolarCity says the installation is “believed to be the first utility-scale system in the U.S. to provide dispatchable solar energy, meaning that the utility can count on electricity being available when it’s needed, even hours after the sun goes down.” It is not, however, the very first use of energy storage at a grid or utility scale, says GTM Research’s Manghani. Still, Manghani says SolarCity’s proposed installation is unique in two respects — the first being its size. “If this were to go through, that would make it the largest solar plus storage system in terms of megawatt hours of storage capacity,” he says.

Another distinction, he says, lies in truly shifting the time of solar energy use — rather than simply using energy storage to help smooth things out when solar either ramps up earlier in the day, or ramps down in the evening. “What this particular system would do, it’s going to completely shift the solar output to evening hours. So in that regard, it’s different,” he says.

But pairing energy storage with solar arrays is happening in other places, too, albeit at somewhat smaller scales. Other interesting projects include the Stafford Hill Solar Farm in Rutland, Vt., which has been dubbed “the first micro-grid established using solely solar energy and battery back-up, with no access to other fuels,” and which just came online, according to reporting by USA Today.

There’s also the Anahola Solar Project, also on Kaua’i, which is slated to be completed soon and will also feature battery storage, according to Manghani. And finally, Southern Company and the Electric Power Research Institute (EPRI) this week will unveil an energy storage “demonstration project” in Cedartown, Ga., that pairs a 1 megawatt lithium ion battery with a 1 megawatt solar photovoltaic installation.

Kimberly Greene, executive vice president and chief operating officer at Southern Company, told the Post in a statement that the company and EPRI “are examining the kind of battery storage technology that could help shape America’s future. The development of cost-effective energy storage is important to delivering the full potential of renewable energy for the benefit of the families we serve.”

And there are still other intriguing advances in the storage space. For instance, Advanced Microgrid Solutions and SunEdison recently announced that they’ve contracted to provide Southern California Edison with 50 megawatts of energy storage capacity, in the form of “hybrid electric buildings” that will be able to shift off the grid and onto batteries at times of peak energy demand. It’s another kind of time shifting — not necessarily in conjunction with solar (though it could be), but simply to avoid using grid energy at the costliest times.

Energy storage overall is a small market but set to grow quickly, according to not only Manghani’s research but other industry watchers. “What we’re seeing is aggressive equity players putting money and liking the return profiles and the performance of storage systems,” says David Fennema, a managing director with CohnReznick Capital Markets Securities who works on mergers and acquisitions in the renewable energy space. “And now we’re starting to see lenders really wake up and get excited, and when that happens, you know you have something that passes the numbers test.”

That’s what’s so significant about energy storage — it takes away the need to use electricity immediately, giving flexibility in when you use power from different sources. And once we break through this barrier, the consequences could be transformative.