VRB-ESS Government Incentives

This is a big month for us and many other energy storage companies. The American Recovery and Reinvestment Act - ARRA - a.k.a the Obama Stimulus Legislation - contains many incentives for energy storage and the smart grid. We're currently submitting several projects under the Smart Grid Demonstration Grant, which targets energy storage demonstrations. The deadline for submission is August 26th, and the total package will probably run to over 100 pages. We don't know how many projects will be submitted for the VRB-ESS - several sites are under evaluation - but, due to the complexity of the grant application process, we'll probably have to shut the door to additional projects around the 15th.

The Smart Grid Demonstration Grant is looking for several different types of demonstrations. The VRB-ESS is a good candidate for each category except one that is specifically set aside for compressed air energy storage. Grants are running from a couple million dollars for 1-3 MW installations to $25 million for 8-15 MW.

Here is the current breakdown of incentives for the VRB-ESS. We believe that the VRB-ESS specifically qualifies for these incentives in California - other energy storage technologies may not qualify.

• ARRA - Under the current grant opportunity, the Department of Energy will fund 50% of an eligible project.
• SGIP - the California Self Generation Incentive Program will provide a rebate of $2 Watt ($2 million per MW) for the VRB-ESS in association with on-site fuel cells or wind turbines. We believe the VRB-ESS will also qualify for an additional 20% ($2.40 per Watt) under a specific provision for California suppliers.
• ITC - The Investment Tax Credit cash grant is equal to 30% of a project cost when integrated with other renewable energy projects. There are many conditions to this grant, but it's actually very liberal for the VRB-ESS. It will apply to VRB-ESS retrofits to existing cogeneration, fuel cells, biomass, hydro, wind, solar, etc. installations.

Bottom-line - a short term opportunity exists to fund up to 90% of the installation cost for a VRB-ESS system. Such a system would provide a generator or industrial site with many economic benefits, including load / generation shifting, power quality, energy security - and provide the potential to earn revenue from CAISO ancillary services or demand response programs. Most evaluations we've done show a payback in months. If you think your site could qualify, contact us at ctoca @ utility-savings.com for an evaluation.