Finding Value Propositions in Batteries for Microgrids
By Beth Chacon, Xcel Energy
In today’s busy world we are dependent on batteries to power our phones, computers, cars and multiple electronic devices. Bottom line-they are essential to our daily lives.
Yet in the utility world, we’re still testing and learning about their true potential and value to the industry and its customers. Battery storage systems can provide multiple benefits to the electric grid.
Given the price of battery storage systems, using multiple capabilities is key to making them cost-effective. For example, battery systems can help integrate more renewable energy into the grid and perform other functions such as managing grid and feeder issues, as well as providing back up power to customers. A unique partnership between Xcel Energy, Panasonic and Denver International Airport (DIA) aims to examine complementary value propositions that will maximize a battery’s economic potential by providing value for both the utility and customers.
With this project, Xcel Energy will own and operate a battery storage system that will help facilitate the integration of renewable energy, enhance reliability of the distribution system and assist in providing voltage management and peak reduction. This project is located on a feeder that already has 20 percent solar penetration; this level will increase to 30 percent by the time the project is completed. A portion of the battery system also will be reserved to provide power to Panasonic in case of a grid outage.
|Artist rendering of Panasonic’s Denver headquarters showing the energy storage system. Courtesy of Panasonic and Xcel Energy|
|Photograph provided courtesy of Denver International Airport|
The Panasonic battery demonstration project is an Xcel Energy Colorado Innovative Clean Technology (ICT) program. The company’s ICT program-approved by the Colorado Utilities Commission (CPUC) in 2009-allows Xcel Energy to test emerging energy technologies that can potentially lower greenhouse gas emissions and provide other environmental benefits. ICT pilots also allow Xcel Energy to evaluate a technology’s cost, reliability and environmental performance on a small, demonstration scale to determine if the technology is cost effective and ready to be deployed more widely for its customers.
The CPUC approved the Panasonic battery demonstration project in March 2016. The project will expand upon the findings of Xcel Energy’s earlier ICT Community Energy Storage project at Solar Technology Acceleration Center (SolarTAC) in Aurora, Colorado. This project demonstrated how battery storage can help integrate PV solar onto the grid by providing ramp rate control and smoothing of distributed solar generation.
The Panasonic demonstration project is composed of four primary components: a 1.3-MW AC carport solar installation, a 0.2-MW AC rooftop PV system at Panasonic’s facility, a 1-MW/2-MWh lithium ion battery, and the switching and control systems to operate the energy storage system and microgrid functionality. The project is being sited adjacent to Panasonic’s corporate office building. Over the course of the two-year demonstration, the system will be tested under multiple scenarios to determine how it can be used to increase reliability and resiliency for both the electric grid and Panasonic.
|Photograph provided courtesy of Denver International Airport|
“We know that storage is a versatile asset that can provide diverse values to a utility, its customers and the grid at large,” said Peter Bronski, head of marketing for the Energy Solutions Group and CityNOW at Panasonic. “As a leading clean energy solutions company focused on solar and solar+storage, we’re very interested in learning in partnership with Xcel Energy-and experimenting on ourselves at our new Denver headquarters-about leveraging storage to build a cleaner, more reliable electricity grid of the future.”
Another partner in the program, DIA hopes “this project will showcase microgrid and battery elements that may support the airport’s future growth in aviation and commercial activities by improving the resiliency and sustainability of critical DIA assets and better integrating the airport’s loads with the surrounding grid,” said Scott Morrissey, DIA’s acting senior director of sustainability. “It also will demonstrate how the Pena Station Next Transit Oriented Development can be an attractive site with secure, resilient and sustainable energy systems as the development grows.”
Panasonic’s Denver headquarters is located within the new 400-acre Pena Station NEXT development, southwest of DIA. Its campus is part of a public/private collaboration whose goal is to build a community with renewable energy, sustainable construction and shops and restaurants intermingled with community centers, playgrounds, bike paths and public transportation. Panasonic is expected to move into its new, 115,000-sqaure-foot facility in Fall 2016. With space for 300 employees, Panasonic’s building is a short four-minute walk from Pena Station which is served by the Regional Transportation District’s (RTD) University of Colorado “A” Train, which opened in April 2016.
Panasonic chose Denver to build its new technology center and business solutions hub in 2014 after receiving nearly $3 million in business incentive funds from the state and the city and county of Denver. It’s expected that the company will bring an economic benefit of $82 million a year to the area.
The total estimated cost of the Panasonic battery project is $10.3 million with $3.6 million being contributed by the project’s partners: Panasonic through preferential pricing in construction, maintenance and labor ($1.1 million) and DIA funding the carport canopy structure supporting the 1.3 MW AC of PV generation at a cost of $2.5 million.
As owner of the carport structure, DIA will be able to charge for covered parking, while Xcel Energy will have a long-term lease arrangement allowing Xcel Energy to own the carport’s solar. Xcel Energy also will own the battery that will be sited at Panasonic’s facility. Panasonic will maintain it.
The battery can help manage solar generation through both solar smoothing and solar time shifting. In a smoothing mode, the battery will charge and discharge to minimize rapid fluctuations in PV output, as well as regulate voltage increases. The two PV systems that are part of the project, the carport PV and Panasonic’s rooftop PV, will be monitored and will serve as a proxy for all solar generation on the feeder.
In a solar time shifting mode, the battery will store excess solar generation when output is high and dispatch energy later in the day. This approach helps reduce system feeder peak.
“As a battery manufacturer and as an energy storage solutions provider, Panasonic believes we can learn more about becoming more sustainable and incorporate renewable energy into a microgrid,” said Terry Jennings, senior project manager at Panasonic.
All parties involved are also interested in investigating the possibility of providing customers with added resiliency. This is achieved by using a microgrid to provide back-up service in case of a grid outage. This solution might be more cost effective than traditional solutions, such as providing customers access to an alternate feeder through costly line extensions and the use of automatic throw-over switches.
This solution could prove to be ideal for customers in remote locations or where alternatives are otherwise cost prohibitive.
“Panasonic is very interested in using the microgrid for resiliency for critical operations and for steady power flow,” Matthew Crosby, Panasonic’s utility solutions program manager, said. “We see an emerging industry focus on utilizing battery storage and advanced grid solutions to enhance power quality, something that major customers like data centers and high tech manufacturers increasingly value.”
In the event of a grid outage, the battery storage system will activate an “islanding” switch and automatically form a microgrid, allowing the battery to provide power to the Panasonic building. In this microgrid mode, both the battery and rooftop PV will provide power. Should power from the PV system exceed the building’s needs, excess energy will be stored in the battery.
“Our Denver network operations center (NOC) supports hundreds of solar energy centers including solar energy projects for Fortune 2,000 and utility companies. It has to be running all the time-that is a priority,” Bronski said.
“Making sure it is functional 100 percent of the time is truly business and mission critical. Having it served by the microgrid is quite key.”
Once grid power has been restored, the microgrid will transition out of islanding mode and back to grid following mode. This is accomplished by having an inverter-based generator synch with grid conditions and allowing a closed transition switch to connect back to the grid. To ensure grid stability the grid must maintain a steady state for five minutes before leaving islanding mode.
After the two-year pilot is complete and the data collected has been analyzed, the battery will operate at its optimal settings. It will function at these settings for the rest of its life span-approximately eight additional years or about 10 years total.
Beth Chacon is director of grid storage and emerging technologies at Xcel Energy, a Minneapolis-based company that serves 3.5 million electric and 2 million natural gas customers in eight states. She leads battery efforts in the distribution area. She can be reached at firstname.lastname@example.org.