Tag Archives: Utility Dive

Navigating the evolving state of the storage industry

At-a-Glance: 

At-a-Glance: Wärtsilä’s Vice President of Energy Storage and Optimization, Andy Tang, details that the energy storage industry is in its infancy of a global pricing reset which will impact deployments for years to come. Yet, there are solutions that can help energy providers navigate the dynamics of the shifting market. To learn more, read, “Navigating the evolving state of the storage industry.”

 

Key Takeaways:

  • A decade-long cost decline has driven battery adoption, making the United States the largest market for stationary storage in the world.
    • Bloomberg New Energy Finance predicts that annual demand for lithium-ion batteries will surpass 2.7 terawatt-hours by 2030.
  • The solar industry is dealing with similar industry-wide supply chain constraints that have caused the Solar Energy Industries Association (SEIA) to lower their 2022 forecasts by as much as 25 percent.
  • Integrators will need to do their part to set transparent and reasonable expectations on cost structure and timelines with offtakers.
  • Leveraging weather, use-case, historical system performance and battery data, energy management software can forecast how much power an adjoining plant will produce and take advantage of and balance for price variations, among other insights.

Path to 100% Perspective:

Energy providers are now tasked with navigating the most efficient energy storage deployment tactics in the midst of the industry’s global pricing reset. Battery storage remains a competitive and popular storage option among today’s power system technologies. However, what can utilities and grid operators expect batteries to cost in the coming decades and how will this technology likely evolve to meet market needs in the future?

Short-duration and long-duration energy storage are both necessary in future power systems and they each have different roles. Long-duration storage has been the missing piece of the decarbonization puzzle – it is crucial to manage variability in supply and demand to manage the industry’s pricing shift. 

 

DOE eyes AI, machine learning to accelerate long-duration energy storage research

At-a-Glance:

A proposed federal research program to accelerate research into the durability and performance of long-duration energy storage is a critical step to meeting the Biden administration’s decarbonization goals, speakers said Thursday at a Department of Energy (DOE) panel. DOE officials said long-duration energy storage technology must be commercially ready, at scale, by 2030, in order to increase the share of renewables on the grid and meet the administration’s 100% clean electricity by 2035 goal. To learn more, read, “DOE eyes AI, machine learning to accelerate long-duration energy storage research.”

Key Takeaways:

  • In July, DOE announced a moonshot goal to reduce the cost of utility-scale, long-duration storage by 90% within a decade, backed by federal research, large-scale demonstrations and domestic manufacturing incentives
  • Deputy Energy Secretary David Turk said bringing long-duration storage to the grid wouldn’t just make it possible to rely on more renewable energy, but also “increase resilience and lower energy burdens” for vulnerable communities.
  • Although there have been technical breakthroughs on long-duration technologies — notably Form Energy’s July announcement of a 100-hour iron-air battery — experts have cautioned about the limited window to test batteries in the real world.
    • ROVI, the proposed initiative from DOE’s national labs, seeks to close that information gap by using machine learning and artificial intelligence to model performance of different long-duration storage technologies, including predicting how the technology will lose performance or hold up physically over time.

Path to 100% Perspective:

Artificial Intelligence (AI) and Machine Learning (ML) will be key elements for the design of future energy systems, supporting the growth of smart grids and improving the efficiency of power generation, along with the interaction among electricity customers and utilities. Centralized power systems enable equal access to clean power at the lowest cost, reducing economic inequality. Regardless of whether the path forward is more or less centralized, AI brings value to all parties. The more AI is used in the dispatch of power plants, the more it will be needed in the design and creation process for new power plants or aggregations of power generation equipment. AI and equipment expertise are needed to enhance the safety, reliability, and efficiency of power equipment and systems. AI and machine learning will play increasingly important roles in future power generation, especially as more communities and organizations come to rely on smart grids and renewable fuels for their electricity needs.

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WRI lays out options for large energy users to decarbonize beyond renewables procurement

At-a-Glance:

Large energy buyers should take a leading role in accelerating the carbon-free grid transition by expanding their approaches to clean energy procurement practices, the World Resources Institute (WRI) wrote in a recently published report. Pursuing transmission buildout to increase access of clean energy, incorporating demand flexibility in procurement practices and getting more granular data on grid emissions, such as hourly matching, are some of the innovative approaches that cities and corporations with decarbonization goals have already taken to explore market products and opportunities across the grids they operate on, according to the WRI report. To learn more, read, “WRI lays out options for large energy users to decarbonize beyond renewables procurement.”

Key Takeaways:

  • WRI highlighted the efforts of Google; Microsoft; Apple; Des Moines, Iowa; Sacramento, California, and other large energy buyers to use different procurement practices with a focus on firm resources, reducing near-term emissions reductions, or enabling battery storage and carbon capture.
  • Michael Terrell, who chairs the board of the Renewable Energy Buyers Alliance, said that 80% of the renewable energy deals in the U.S. occur in deregulated wholesale markets.
  • Des Moines, which WRI reported as the first U.S. city to commit to a 24/7 carbon-free electricity target by 2035, sought allies in other customers of MidAmerican Energy, a subsidiary of Berkshire Hathaway.
    • Des Moines’ progress and approach is upheld as an example in the recent WRI study.

Path to 100% Perspective: 

State, provincial, municipal and in some cases national governments are declaring mandatory targets for 100% clean power. These regulatory targets are often considered renewable mandates as it is commonly understood that wind, solar, hydro and other renewable energy sources are needed to replace fossil-fuel power plants in a zero-carbon emissions future. In most cases, the metrics that define “100%” compliance are often decoupled from strict renewable requirements, quantified using metrics such as carbon intensity (e.g., 0 g/kWh of CO2 emissions), thus potentially allowing for nuclear and combustion of biofuels and synthetic renewable fuels to meet the goals. The terms 100% renewable, 100% carbon-free and 100% carbon-neutral are often used interchangeably.

 

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ERCOT releases plan to boost reliability after blackouts, as report outlines gas, electric failures

At-a-Glance:

The Electric Reliability Council of Texas released a 60-point roadmap outlining how the grid operator plans to ensure the state’s power grid is more reliable, following the catastrophic blackouts last winter that almost shut down the region’s entire electric system. A report released by he University of Texas at Austin’s Energy Institute analyzes what went wrong,  finding the outages that plagued Texas last winter were caused by multiple failures across the gas and electric systems, including, in part, fuel shortages, outages at critical fuel facilities and non-weatherized power plants. To learn more, read “ERCOT releases plan to boost reliability after blackouts, as report outlines gas, electric failures.”

Key Takeaways:

  • The Texas legislature passed comprehensive legislation intended to overhaul the state’s power grid and strengthen reliability.
    • Two of the bills, signed into law, will require power companies to weatherize their power plants and transmission lines, and require ERCOT’s board to be appointed by state legislators.
  • UT’s report found the “failure” of the natural gas and electric system during the February winter storm “had no single cause.”
    • All generation technologies — gas, coal and nuclear plants, as well as solar and wind facilities — failed in some capacity as a result of the storm.
  • ERCOT’s most extreme winter scenario underestimated demand by about 9,600 MW, or 14%, the report found, while weather models inaccurately predicted the timing and severity of the storm.
  • Several generating units were not weatherized properly, the report found, in part leading to these issues.

Path to 100% Perspective: 

February’s arctic cold wave caused widespread blackouts in Texas because many power plants were not designed for extreme ambient temperatures, which caused them to become inoperable during the below freezing temperatures. Winterizing gas supply and power plants is required to avoid another blackout scenario. Although it is more expensive to winterize the gas supply and power plants, it is necessary to offer reliability. On the open electricity markets, plant investors struggle to see the point of winterizing for extreme conditions that may not happen. Indeed, it is going to be more expensive to engineer power plants to expand the temperature range down from 15 degrees fahrenheit to 0 degrees fahrenheit, but the critical need for power during these conditions would make the investment prudent.

Wärtsilä launches project to develop 100% hydrogen-fueled engine and power plant concept by 2025

At-a-Glance:

Technology company Wärtsilä announced an initiative to develop an engine and power plant concept that will be able to run on 100% hydrogen by 2025, in a move that could contribute to widespread decarbonization of the electric power industry and other sectors. The company’s new project aims to develop that concept by 2025, and commercialize it by the end of the decade. To learn more, read “Wärtsilä launches project to develop 100% hydrogen-fueled engine and power plant concept by 2025,” or “Everything we know about Wärtsilä Energy’s hydrogen engines.” Reading these articles may require a subscription from the media outlets.

Key Takeaways:

  • Roughly one in three people in the U.S. live in a state or city that is trying to transition to 100% clean electricity, according to Natural Resources Defense Council (NRDC), with the Biden administration pushing for a national 100% standard by 2035.
  • “Our base engine concept is very flexible — it can take very different types of fuels already today. But now, we’re evolving this flexibility up to 100% hydrogen,” Wärtsilä CEO Håkan Agnevall said.
  • “At the end of the day, when 100% hydrogen is available, our engines can run with that and, with new engines coming in, we can make the transition with the small changes that are needed for the engines,” Jukka Lehtonen, Vice-President of Technology and Product Management of Energy Business at Wärtsilä Energy said.
  • Some utilities are already exploring the potential of hydrogen — NextEra Energy, for instance, views it as a key piece of deep decarbonization efforts and has said it’s rolling out small hydrogen projects.

Path to 100% Perspective: 

Decarbonization is technically and commercially feasible with technologies that are already available at scale. These technologies include:

  • Wind and solar photovoltaic (PV) as the main sources of primary energy
  • Short-duration battery energy storage.
  • Flexible thermal balancing power plants to provide firm and dispatchable capacity.
  • Sustainable fuels used in thermal balancing power plants, forming long- term energy storage. Sustainable fuels include green hydrogen and hydrogen-based fuels, such as ammonia, methanol and synthetic meth- ane produced from renewable sources.

Texas must increase ties to the national grid and DER to avoid another power catastrophe, analysts say

At-a-Glance:

Texans were left in the cold and dark this February, following extreme cold weather that had the Texas competitive energy market unable to prevent deadly power failures. Leaving behind its historic commitment to power system independence and joining the larger U.S. grid can relieve some of the consequences of extreme weather events Texas is likely to see again, many energy analysts in and out of Texas said. To learn more, read “Texas must increase ties to the national grid and DER to avoid another power catastrophe, analysts say.”

Key Takeaways:

  • “We designed this system for Ozzie and Harriet weather and we now have Mad Max,” said Texas energy consultant Alison Silverstein.
  • Some customers discovered variable bill plans can come with price spikes.
  • “The theory is that a high price will bring investments, but people don’t invest in things that might only make money sometime in the future unless they are required to,” said Jussi Heikkinen, North America Director of Growth and Development for global power plant developer Wärtsilä.

Path to 100% Perspective:

Texas does not have firm rules on power plant engineering for ambient temp ranges. Recommendations from ERCOT were published after the 2011 blackouts, but they are not mandatory, like they are in the eastern part of the country The Texas blackouts are an urgent indication that recommendations should be turned into common-sense regulation that leads to grid reliability and ratepayer protection.

 

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Xcel cuts carbon emissions 50% by 2021, eyes Colorado transmission, coal plants to reach 2030 goal

At-a-Glance:

Xcel Energy estimates that it has reduced carbon emissions 50% below 2005 levels in 2020, and is on track to meet its 2030 target of reducing carbon emissions 80% in the next decade, based on its upcoming integrated resource plans (IRPs). To learn more, read “Xcel cuts carbon emissions 50% by 2021, eyes Colorado transmission, coal plants to reach 2030 goal.”

 Key Takeaways:

  • Xcel completed six wind projects in 2020, representing nearly 1,500 MW of capacity. Another 800 MW of wind projects are under construction and expected to become operational in 2021.
  • Xcel plans to file solar plans with Minnesota regulators later this year, which would have the utility develop 460 MW of solar near its Sherco coal plant – retiring in 2030 – to take advantage of existing transmission near the plant.
  • Although specifics are not available regarding Xcel’s upcoming Colorado IRP, the plan will include transmission expansion to bring additional load from remote-located renewables into the Denver area.
  • Xcel will also propose a plan for its remaining Colorado coal plants, as well as adding more renewables, to put the utility on track to reduce its carbon footprint 80% by 2030.
  • Xcel plans to exit coal entirely in Minnesota by 2030.
  • Xcel executives will continue to be bullish on electric vehicle infrastructure build outs, investing $500 million in charging stations and distribution system infrastructure over the next five years, and closer to $1.5 – 2 billion over the next decade.

Path to 100% Perspective:

Xcel is paving the path to 100% for those in the energy sector, setting and meeting ambitious carbon reduction goals and building out its renewable energy capacity. Leveraging existing infrastructure while making key investments in solar and wind will help ease the transition to 100% carbon-free energy and serve as an example to others looking to do the same.

 

 

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Hydrogen advocates look to capitalize on California’s goal to replace diesel for back-up generation

At-a-Glance:

California regulators are on the lookout for cleaner alternatives to replace the widespread use of back-up diesel generation – particularly among data centers in Silicon Valley and other areas of the state – and some industry players think hydrogen could be the answer. To learn more, read “Hydrogen advocates look to capitalize on California’s goal to replace diesel for back-up generation.”

Key Takeaways:

  • Hydrogen fuel cells are advantageous for several reasons: they occupy less space than batteries, possess long-term storage capability, are quiet, reliable, and 100% zero-emission.
  • The key draw of hydrogen is its cost effectiveness at longer durations.
    • For a completely resilient, 100% renewable data center with zero emissions, using hydrogen would translate to a levelized cost of electricity amounting to $119 per MWh.
    • Batteries would lead to over $4,000 per MWh levelized cost to ensure 48 hours of backup power.
  • Taking a step back from the issue of replacing diesel back-up generators, environmental advocates are urging the state to prioritize the adoption of renewable, zero emissions technologies.
  • Ben Schwartz, policy manager at Clean Coalition, said California could adopt policies to promote the efficiency of solar and storage alternatives to diesel generation.

Path to 100% Perspective:

Renewable fuels, such as hydrogen, can help utilities overcome the variability challenges posed by seasonal conditions and extreme weather. One approach that can be leveraged in the transition to a 100% renewable energy system is power-to-gas (PtG). PtG technology uses excess energy from wind and solar to produce synthetic hydrogen and methane. The combination of stored fuel potential and thermal capacity yields a long-term energy storage system that acts like a gigantic distributed “battery.” Coupled with traditional, shorter-term storage technologies, this system can help meet seasonal energy demands when renewables are variable, and provide a reliable and secure supply of electricity during periods of extreme weather.

 

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California’s pathway to 100% clean electricity begins to take shape, but reliability concerns persist

At-a-Glance

California’s energy agencies are taking a first stab at assessing possible pathways to the state’s ambitious goal of achieving 100% renewable and zero-carbon electricity by 2045, but concerns about system reliability — especially in light of the rolling blackouts — continue to plague regulators. The California Public Utilities Commission (CPUC), California Energy Commission (CEC) and California Air Resources Board (CARB) released a draft report on getting to a 2045 clean electricity portfolio, which indicated the goal is technically achievable. To learn more, read “California’s pathway to 100% clean electricity begins to take shape, but reliability concerns persist.”

Key Takeaways

  • The report presents important initial insights into potential paths for the electric sector, Mary Nichols, CARB chair, said at the workshop, adding that “the initial work highlights the enormous challenge ahead, requiring a complete transformation in the type of electricity that Californians consume.”
  • California’s carbon goals are part of legislation passed by the state in 2018, called Senate Bill 100, which calls for 100% of electric retail sales in the state to come from renewable energy and zero-carbon resources by the end of 2045.
  • The bill also required the three energy agencies to create a report evaluating the policy and follow it up with updates at least every four years. The agencies intend to submit a final version of the initial report early next year.
  • Based on this analysis, the report concludes that achieving the 100% clean electricity goal is technically achievable, and could cost around 6% more than the baseline 60% Renewable Portfolio Standard (RPS) future by 2045, although that could change if renewables continue to decline in cost at a faster rate than anticipated by the models.

Path to 100% Perspective

A place where the transition to renewables has progressed quite far already is California. The lessons learned along the way have been plentiful, but powerful nonetheless. The record-breaking heat wave that swept across the western part of the country and caused a series of blackouts in the Golden State, offered additional modelling opportunities to demonstrate the most effective mix of energy to accommodate any extreme weather situation during the transition, and to meet clean power mandates. The big challenge facing California and the rest of the world is how to integrate renewables into the grid while building security of supply and a sustainable power system with an affordable plan for everyone involved.

 

 

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