Going Green: Batteries Reduce Rates and Keep Utilities Happy

Do Advanced Microgrid Solutions Offer a Power Grid Solution?

In an article last September on on-site energy storage, I suggested holding off as the Tesla batteries are expensive and basically unproven. I was, however, upbeat about all the efforts taking place to create cost-effective storage.

One promising recent development is taking place in Orange County. Southern California Edison has been struggling to respond to the shutdown of the San Onofre Nuclear Power Plant and the chaotic energy void its closure left. Edison’s response is to install natural gas plants to fill the void — not a good solution for a carbon-free future.

The increase in rooftop solar electric generation creates headaches for utilities: They can’t predict how much energy all these small suppliers will produce or when. It makes it hard for them to balance supply and demand and avoid blackouts. This worry is a key reason California recently decided to require the state’s big utilities to buy more than a thousand megawatts’ worth of energy storage by 2020.

One company, Advanced Microgrid Solutions (AMS), is promoting grouping renewables, mostly solar, while employing unique software to manage loads. This guarantees a reduced amount of electricity the utility will have to supply the project. AMS is able to do this by providing storage on the customer side of the meter to reduce and flatten peak demand.

The sophisticated tracking and switching software discharges the batteries during the late afternoon or early evening times — times that coincide with the dirtiest and most expensive power the utility generates. The batteries are recharged by fully utilizing solar production or the cheapest off-peak utility power. It is the megawatt scale that makes this attractive to the utility.

Batteries are still expensive, but when delivering multiple benefits to multiple parties (utilities, customers, and battery investors), they start making economic sense. AMS uses garage-size containers filled with batteries. They now have about 35 megawatts online, with many more soon to be operational. They look for compact projects that can fit an Edison substation area so that the reduced load has the greatest value to the utility. In return, the rates the customer pays have been brought down about 25 percent — a win for everyone.  

The Santa Barbara region is Edison’s second most worrisome area, as it is remote and is served by antiquated transmission lines. AMS’s approach would be well-suited to reducing this vulnerability, increasing reliability, and saving costs by setting up a project incorporating our desal, water, and sanitation plants. UCSB and even a large grouping of downtown businesses could form other projects of suitable scale.

As Mary Nichols, chair of the California Air Resources Board, said, “Reducing demand on the grid instead of adding new peaker plants is the fastest way to reduce greenhouse-gas emissions while improving reliability for customers.”


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