PV in Transition: Distributed Energy Storage and Distributed Power Quality Control

We are seeing increasing interest and public exposure to the concept of distributed energy storage (DES). This new emphasis on how/where energy storage is deployed has been seen in new products offered in our industry trade shows (SPI 2013-’14-’15 for example) and increasingly in our literature (see James Montgomery’s seminal article, “The Case for Distributed Energy Storage”).

In Transition

PV systems are in transition, from being only distributed generation installations, to becoming enabled with DES and power quality control.

Distributed solar generation (DG) offers well-documented advantages in both shoring-up service quality in existing electrical T&D systems (meeting increasing demands for both additional power, and lately, with the introduction of bidirectional inverters), to play an important role in on-site power-quality control — hence, distributed power quality control, a.k.a., on-site power quality control.

The Case for DG

The case for DG has been empirically proven and its need is steadily growing.

There are well-documented and proven advantages to DG to be found in the dispatch-ability, higher efficiency of energy resources to on-site power delivery, and the offering of instantaneous deployment of either peaking power for peak-shaving or longer term power needs that may be seasonally presented in the variability of on-site demand requirements.

Ideal Partners

DG is ideally partnered with DES and distributed power quality control.

First, having battery systems co-located with PV generation creates the shortest link between generation, storage and delivery of quality-controlled power. This partnership results in lower losses and higher efficiency in power delivery (a net benefit to both the local user and the larger utility power system). Having on-site energy storage creates “dispatch-able” solar power and enables local power quality treatment 24 hours a day, even in the absence of PV generation at night.

Second, DES is equally capable of working in front of or behind the meter. The coming diffusion of smart meters anticipates the introduction of smart billing, allowing utilities to recover their costs for the extra kVA they must supply (without being allowed to collect the extra costs to retail markets) to residential loads distorted with on-site created reactive losses.

This article does not attempt to model any net economic benefit to PV-system owners of DES — but additional values are supplied in power security, load shifting/following and a host of other complex value points, which are beyond the scope of this article.

In determining the scope of coverage — that is, defining the size or number of connections that defines DES — we should not view DES as applying only to individually metered nodes, but DES works well across a larger aggregation of connected loads (microgrids or rural branch-feeder circuits for example). Wireless communication from a master controller can aggregate a large number of virtual-microgrid elements of DES systems (community rooftop solar + storage systems, for example) and dispatch them simultaneously, in concert, to treat temporary or persistent, localized power quality problems. Comparing this model to dragging centrally stored (but electrically remote) energy through distant utility power lines and local switchgear quickly shows the advantages of treating localized or aggregated power quality problems with DES resources nearest their source.

It is easy to visualize a medical or university campus, or a large shopping center, creating a physically aggregated load which is electrically isolated, yet is a source of power quality distortion, within a larger utility service district. So my position is that size of the energy-storage asset should give way to how localized the offending loads are in determining differences between what is “central” vs. “distributed” energy storage. Air conditioning, refrigeration and lighting circuits can all create both EMI-noise, load surges, and reactive power shifts which are proximal to the aggregated loads and can be quickly and locally responded to by stored capacitive and/or battery energy.

Third, DES will most likely always be less costly than central energy storage. A good example of how smaller energy systems can be economical can be seen in Tesla’s Powerwall, which, when you peek behind the skin, reveals a large quantity of interconnected energy storage cells. The permanent advantage of using small, cylindrical cells, (say the popular 18X650 lithium-based cell, just a bit larger than a popular “AA” alkaline primary cell) is that literally billions of them are produced each year, driving down the per-cell cost and boosting up their quality control metrics (thank you Moore’s Law and Bill Gates).

In its simplest embodiment a flat battery pack — many interconnected but only one-cell-thick pack — can easily be convection cooled and mounted in proximity to a single solar panel, or used with a small plurality of solar panels. In like manner, aggregating DES to PV-string level combiner boxes allows solvable and relatively inexpensive logic and power electronics circuitry to be employed in any sized solar array.

So in a DC or an AC system, it is straightforward to distribute energy storage and control sub-circuits to very large numbers of string inverters, thus creating a predictable (and scalable) energy storage enablement to both DC and AC solar systems. Modern digital control systems using either wired or wireless control can simultaneously dispatch all of these energy storage + control nodes in concert using presently available, highly reliable telemetry, and digital control topologies.

The resulting aggregate energy storage system described above is electrically and controllably identical to central energy storage systems, which may also use an equally large number of individual energy cells and must also simultaneously dispatch them simultaneously — but often with more expensive packaging and more complex cooling, charge and discharge-balancing, and power-switching controls.

Where is This Budding Industry Heading?

DES is a sea-state change, and it is unfolding rapidly before our eyes. And it will bring an acceleration of clean energy application domestically, but uniquely throughout second and third worlds where soft-grids, or no power at all, rule the power landscape.

Working in the PV and energy storage space for the past 25 years has enabled my observation of several emerging and defining trends.

Costs

Our sourcing for the PV systems with accompanying BOS seems to have outstripped even Moore’s Law. I was a contributor to building my university’s energy center in 1999-2002 (www.gvsu.edu/marec) where we paid $12/watt for our 30 kW BIPV roof (just the PV, not BOS), and an additional $2500 per managed kWh for our 80 kWh cycling nickel-metal hydride energy storage system.

In 2015-16, PV (in large installs) can be procured for 4.3 percent of what we paid 14 years ago — and the unit-energy storage cell used to build distributed-battery systems have halved in price in 2015 alone. Compared to my $2500/kWh 2002 energy storage system invoice (which included all of the system’s BOS), we can now buy elemental cells at $200/kWh, we can build and sell at acceptable margins complete DES plus control systems designed for PV systems near $500/kWh, and we can be at one-fifth the cost for DES since 2002.

I accept that reliable energy storage for use in PV systems must approach $200/kWh to push 24-hour/day power from PV-systems to parity with grid supplied power — mostly because an average power rate must consider commercial/industrial exception rates, and spinning reserve is still very low cost.

Integration

I suspect the diffusion of electric vehicles will make spinning reserve prices increase — but I also recognize that there are very valuable uses of electric energy stored in the night and used to service power quality problems in the day.

Regulation

I reject the position that helping a utility by buying their spinning reserve at night and selling it into the power quality control markets in the day is power arbitrage — it isn’t even selling the same product.

They sell me kWh, and I sell to markets for kVAR, or frequency stabilization, or active transient suppression, which are very different products than kWh. Think about it — if utilities could collect for the value their product is used to create — they could charge automotive assemblers $200/kWh for all the stamping, welding, painting, conveyor, logistics etc., used to make a $35,000 automobile.

Famous economist Edith Penrose defined a product as a “bundle of attributes that meet a certain need” nearly 50 years ago. Let’s not confuse a kWh with a kVAR.

Enjoy the Ride

So where is DES headed? I believe there will always be a need for energy storage in all electrical power systems. Large generating plants are not dispatch-able to meet transient problems or weather related overloads. There are classes of problems which create a natural monopoly for central energy storage systems at large generator sites and major substation sites. Exactly where the effectiveness of central vs. distributed energy resources divide will likely be determined by economic and technical considerations. The definitional issue reminds one of the famous judge who said, “I cannot define pornography, but I know it when I see it.”

As for me, I only hope to add to the clarity to what I see as an up-and-coming resource that has very well-defined needs in places where clean power is weak, variable, or non existent. But then there is the on-going work in Hawaii where even the Wall Street Journal weighed-in on in June 2015 reporting that an estimated 300 MWh of energy storage needed to be DISTRIBUTED among 50,000 private solar-roofs on Oahu, so their daily PV-power could be stored and used to load-shift all of that “known” PV-energy to 6PM to 10PM at night, allowing HECO a rational nighttime turn-down on diesel generator stations.

Lead image: Solar power battery concept. Credit: Shutterstock.

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Dr. James Wolter is Professor Emeritus of Marketing at Grand Valley State University where he taught Graduate Courses in Marketing Management, Business Planning, New Product Development and Management of Technology. Jim has worked in public service for the Michigan Economic Development Corporation and was the co-founder of the University’s MAREC Center (Michigan Alternative and Renewable Energy Center) where he directed renewable energy research (1999-2002) before returning to full-time teaching in 2002-2003. Jim retired from classroom teaching in August 2010 to found Energy Partners, LLC, an Energy Research and Product Development Lab at the University’s MAREC Center. His recent work has focused on helping firms which are developing and marketing new renewable-energy products involving power generation, control, and energy storage.

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