ITC Cash Grant for Storage

While the new guidelines from Treasury for the ITC grant are garnering headlines, a slightly overlooked item is the extension of the grant to energy storage!

Developers and vendors have had mixed views over the potential application of the Investment Tax Credit to energy storage equipment at renewable energy facilities. Guidance was lacking and opinions were mixed, including those of government agencies. Storage would allow PV and other intermittent renewables to increase their revenue per kW by providing firm and dispatchable power, increased sales of energy during the highest paid peak period, and the ability to offer additional ancillary services of great value to the grid operator. But, without the assurance of a tax credit, developers were cautious about figuring storage into their calculations.

However, the Treasury has now issued guidance on the ITC cash grant in lieu of a credit, and storage facilities are included. (see page 11) Storage must be "integrated" into the project, but the guidance on that is not restrictive. Now, the additional revenue from using storage can be factored into a project, and the investors can benefit from the tax credit/grant.

The Energy Storage Market is Like an Elephant

In my presentations to various government agencies, I often reference the story of the blind men and the elephant. This is a story with variations in many cultures, but it essentially involves several wise blind men coming upon an elephant for the first time. One grabs the trunk and exclaims that an elephant is like a snake! Another grabs the tusk and believes an elephant is like a spear, another the tail and believes the elephant is like a rope, another the side of the elephant and believes the elephant to be a wall, and so on. The blind men are accurate in their limited grasp of what an elephant "is", but they don't see the larger picture.

I use the analogy with energy storage and the VRB-ESS. Different players see the VRB energy storage system from their limited perspectives and they tend to have limited applications. Is the VRB-ESS a peak shifting resource, distributed energy resource, demand response, intermittent renewable energy integration, capital deferral of distribution / transmission assets, power quality, emergency power, on-site power, capacity, ancillary services - frequency regulation, and so on? The answer is yes, all of these, and we should "grasp" the greater value of multiple benefits.

Now Pike Research has a slightly different analogy regarding the market for energy storage, "The energy storage market is like a charging elephant: even if you can’t see what it looks like, you know it’s going to be big." They have a report out that projects a 10 fold increase in the "stationary utility" market from 2008 to 2018 to $4.1 billion. Most market projections for energy storage include vehicles and small applications - like laptop computers - so this is unique and interesting. Energy storage in general, and the flexible and powerful VRB-ESS in particular, have an important and profitable future. More information can be found at their website: http://www.pikeresearch.com/

Solar battery project unveiled in St. Petersburg

I thought this project was announced last year. See the video news report on our website at www.Utility-Savings.com.

"An example of Florida's expertise in energy storage is a demonstration project conducted by University of South Florida and partner Progress Energy Florida which combines renewable distributed energy generation and an advanced battery system to supply renewable energy generated in off-peak hours during peak power demand hours. One of the prototypes of the Sustainable Electric Energy Delivery System (SEEDS) is used on campus, the other at a nearby park to power lights at night."

However, this announcement was posted today, including this audio. Although the VRB-ESS wasn't mentioned by name, they discussed the battery system and the vanadium technology.

First Wind Energy Storage for Ireland

ZBB Energy has a press release out for their flow battery system at a wind farm in Ireland. Flow batteries are a great application at wind farms. The VRB-ESS has been used at wind farms for several years in Japan and Australia, and the Irish government published a report in 2007 about integrating a VRB-ESS into a wind farm, finding that the optimum size for that installation was a 2 MW system with 6 hours of storage (12 MWHrs).

Although the ZBB is a flow battery, there are significant differences between the ZBB and the VRB-ESS. These differences must be kept in mind when planning for an installation.

Configuration:

The ZBB is more energy dense than the VRB - which means it takes up less space. The folks at ZBB have standardized a containerized product - a 50 kWh system that can be linked in groups of 10 to make a 500 kWh system that fits on a truck trailer. This makes the system easily transportable and potentially mobile, allowing it to be trucked to one location and then another as needed. The downside is that there is no flexibility in configuration. The 500 kWh system will deliver a maximum of 250 kW (although it has the capability of exceeding this rating by 110%) for 2 hours. If you want more hours of storage, you must by more capacity, whether you need it or not. More technical information available here...

On the other hand, the VRB is less suited for mobile applications because it is less energy dense - it needs a larger footprint - which isn't a problem at wind farms and solar PV. Since it isn't restricted by the need for a smaller footprint, it can be configured separately for capacity and storage. For example, the Irish study determined an optimum configuration was 2 MW of capacity and 6 hours of storage. At the Hokkaido wind farm, Sumitomo installed a 4 MW system with 90 minutes of storage (this installation, as well as the Irish, is able to pulse up to 150% of capacity for 10 minutes each hour).

Lifecycle:

As flow batteries, both the ZBB and the VRB can charge and discharge many times, ideal for intermittent renewable energy. However, the VRB will have a longer useful life. Both systems use a membrane that doesn't wear out from use, but will get old. As the ZBB membrane ages, the different solutions will come in contact and ruin the system. This doesn't happen with the VRB-ESS due to the single solution technology. If the membranes are replaced, usually in years 10 - 12, the system will last another 10 -12 years.

Charge Cycle:

As mentioned above, both systems can charge and discharge many times. However, the ZBB requires 4.5 hours to recharge it's 2 hour system, a 2.25:1 ratio. The VRB is closer to 1.3:1 and would take about 2.5 hours to "fill" a two hour tank.

Bottom-line, we are seeing many storage technologies becoming available for many storage applications. The growing awareness of the value of grid connected storage to integrate renewables and shave peak demand will increase the demand for flow batteries and the VRB-ESS.