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To Spread, Energy Storage Needs Hybrid Solutions

— March 4, 2015

Imagine a single energy storage system capable of serving all potential needs, from a short burst of high power to keeping the lights on for many hours. Such a system could greatly improve the overall economics of energy storage by removing limitations on the amount of revenue a single system can generate.

This is the focus of several leading companies that are looking to develop hybrid energy storage solutions, combining multiple different technologies in a single system. Energy storage technologies all have their ideal applications; some, such as flywheels, ultracapacitors, and certain lithium-ion chemistries are best at delivering high power over shorter periods of time. Others, such as compressed air and flow batteries, are ideally suited for applications that require a lower level of power to be delivered over a longer period of time. Combining technologies into a single system with the flexibility to perform multiple tasks, could greatly improve not only the economic returns on investment, but also the overall lifetime of storage systems.

Life Extension

Many hybrid energy storage systems are currently available or have already been deployed. Power grid giant ABB has been actively developing its flywheel business and is looking to hybrid systems to fully realize the benefits that flywheels can provide. The company has installed a hybrid flywheel/battery system on remote Kodiak Island, in Alaska. In this installation, two 1 MW flywheels handle the grid’s frequency regulation and high power needs, while the batteries provide the energy density required to fill in the gaps of local wind power generation. As short duration/high power needs are more frequent, this hybrid system reduces the number of times the batteries must be discharged, greatly extending the overall life of the system.

Hybrid systems involving ultracapacitors are also finding promising applications. A leading company in this space is the Spanish firm Win Inertia, which has partnered with ultracapacitor manufacturer Maxwell Technologies to offer an integrated hybrid storage system. The ultracapacitors handle the frequent, intense power requirements, allowing the batteries to be discharged less often. This allows the optimal use of high energy density storage technologies, as well as a rapid response to short term issues. Win Inertia is primarily focusing on the software, controls, and system-integration challenges to make this technology as effective as possible.

Beyond Single Applications

Integration with existing electrical grids presents a major software challenge for energy storage system integrators. When multiple types of storage technologies are integrated into a single system, these challenges become even more complex. The overarching goal of energy storage system integration is to ensure the longevity of a system and its constant availability in the market, thus maximizing the return on investment for system owners.

If these challenges can be overcome, the potential for hybrid storage systems is enormous. Standard storage systems are often designed for only one application, for example frequency regulation, which limits the potential revenue they can generate. Hybrid systems with the ability to meet multiple grid needs and capture multiple revenue streams can be much more economical. While advanced hybrid storage systems are only beginning to emerge, they could one day lead the energy storage market.

 

New York Details Its Vision for the Future of Energy

— March 2, 2015

On February 26, the New York Public Service Commission (PSC) released its long-awaited Phase 1 Order on its Reforming the Energy Vision (REV) proceeding. The order lays out the PSC’s vision for how the future retail electricity market in the state should operate to maximize efficiency, improve reliability, engage customers, and create clean, affordable energy products and services. I can’t cover the entire 328-page order in one blog, but I’ll hit on the major decisions that affect the current utility world order.

The biggest variable in the REV equation was whether the PSC would require an independent party to perform the function of the distributed system platform (DSP), the central role of REV. According to the order, the DSP’s functions include load and network monitoring, enhanced fault detection/location, and automated voltage and volt-ampere reactive (VAR) control. That list covers a lot of what the utilities currently do, so taking those tasks away from them would have caused a major shift in the market landscape. However, the Phase 1 Order outright supports utilities acting as the DSP as a way to minimize the redundancy of actions. This singular decision vastly limits the potential impacts to the state and the utilities. Utilities must be breathing a sigh of relief.

Metering Alternatives

A second thorny issue was whether utilities should be able to own distributed energy resources (DER) or whether DER should be the sole domain of the competitive marketplace. Many market players wanted to prohibit the utilities from competing with them when they might have a natural advantage in acquiring customers. Under the order, utilities will be able to own DER if they run a solicitation to meet a system need and they are able to show that competitive alternatives are inadequate or more costly than a traditional infrastructure alternative. They will also be able to invest in storage to the extent it functions as part of the transmission and distribution (T&D) system. This seems like a reasonable compromise that should work for most parties.

The last major component is advanced metering infrastructure (AMI). Earlier communications from the PSC hardly mentioned metering at all, so it was unclear how the final rule would play out. In fact, the Phase 1 Order does not mandate AMI deployment by utilities. Rather, the PSC prefers the term “advanced metering functionality” (AMF)—meaning that other technologies, including ones provided by third parties, may be able to achieve the desired functionality cheaper and more efficiently than AMI. It states that “each utility Distributed System Integration Plan (DSIP) will need to include a plan for dealing with advanced metering needs; however, plans that involve third party investment may be preferred over sweeping ratepayer funded investments.” This indicates that utilities should consider AMI alternatives before choosing a path forward.

Ticking Clock

As far as next steps, the utilities’ integration plans must be filed by December 15, 2015, so the clock is ticking. Phase 2 of REV will consider reforming the PSC’s ratemaking process so that utilities do not have disincentives to further developing DER. Utility income is tied to bond funds now, but they should depend more on creating value for customers and achieving policy objectives. A draft proposal is expected by June.

It was interesting trying to guess which way the PSC would fall on these and other major issues. Now the real fun begins: implementing the vision.

 

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