Don’t be a DOUG.
The takeaway from Tuesday morning’s keynote at the Energy Storage Association Conference and Expo in Charlotte, N.C. was spelled D-O-U-G, translated to “Dumb Old Utility Guy.”
And this putdown came from Michael O’Sullivan, a longtime utility veteran himself and senior vice president of development for NextEra Energy. He was referring to coming changes in the power industry and how energy storage can be a viable option and value proposition.
The U.S. energy storage industry already touches close to 60 million Americans in 13 states and Washington D.C., according to the Energy Storage Association. IHS Research indicates the annual installation size may “explode” from 0.34 GW in 2012-2013 to six GW next year and 40 GW by 2022.
To sustain this predicted $19 billion annual industry, the players must be flexible, proactive and not expect handouts from federal regulators, the insiders said Tuesday.
“I don’t want to be DOUG,” O’Sullivan said. “We can’t wait for the customer to say I want this or that.”
Skeptics—whether named Doug or not—wonder about the long-term viability of large-scale battery. They note relative high capital costs, concern over safety control and life cycles, among other concerns.
For many of those in Charlotte this week, however, the climate appears just right for those intrigued by large-scale battery technology. Wind and solar power offer more certainty than ever over the next five to seven years, due to tax credits and falling costs, and energy storage can be a smoothing component to those intermittent sources.
Even so, O’Sullivan cautioned, all of those jumping onto the bandwagon must be ready to do their own work and figure it out. And don’t wait for the feds to hand out some new national rule that picks energy storage.
“Be balanced in what we ask, and don’t expect them to be Santa Claus,” he said.
And, as power plant permitting gets more difficult and time-consuming, energy storage should emerge as an option for peaker replacement and alternative to load shedding, insiders say.
Anna Carolina Tortora, head of innovation at Italian transmission firm Terna, shared some hard-won insights on how her utility dealt with the combined effects of an economic crisis and push for renewables. The former tamped down demand greatly, while the latter put many gigawatts online before the grid was ready to handle them.
The result was about 500 GWh lost in 2010. For example, she noted, the boot heel region of Italy has about 800 MW in wind power. When a gust happens, that 800 MW enters the grid and must be used or shed.
A 2011 event in Sicily, which has high distributed generation input, drove that point home with another dramatic, emergency load shed.
“We have to pay for that later,” Tortora said.
Terna, which has more than 44,000 miles of line, 841 substations and deals with 59,400 MW of demand peak, began looking for energy storage options and has developed two sites with 16 MW and 24 MW capacities. The company has spent about 93 million Euros on solutions and is trying multiple battery options, including lithium ion, Zebra and flow batteries.
“Do not fall in love with technologies,” she cautioned. “Technology is a commodity.”
Terna grades various types of battery on factors including capital cost, efficiency, life cycle and operation and maintenance. What they learned is the more you use them the better they are and are speedy-quick, ready to be deployed within 100 milliseconds of need.
“They are the fastest thing on my grid right now,” Tortora said. “This is a real-time business.”
Vermont-based Dynapower has been in the power conversion business for more than 50 years, and company president Adam Knudsen told the ESA crowd of about 1,000 that he has three priorities fundamental to the success of energy storage: 1) Sustainable growth through predictability, return on investment and technical performance; 2) Working together in non-exclusive partnerships that build on lessons learned; And, last but not least, grow and invest responsibility so the supply chain is ready to meet the needs over the life cycle of products.
“To achieve these objectives we have to work together,” Knudsen said.
Dynapower jumped into bi-directional energy storage about nine years ago. The company now has more than 250 MW of energy storage inverters installed worldwide, while its largest system is a 36 MW complex at a Duke Energy installation in Texas.
“Through the years we have had to collaborate,” he said. “We don’t get over the goal line by ourselves.”
And although a fast-growing industry needs strong rules and policies in place, both he and O’Sullivan pointed out, Knudsen cautioned against too much standardization too fast.
“The market is not ready for standardized products,” the Dynapower president noted. “We need to have flexible solutions. We’re not going to have a system that’s an end-all, be-all.”
This article was originally published by Electric Light & Power and was republished with permission.