Microgrids and battery storage – industrial use cases
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- Feb 12, 2020 2:04 pm GMT
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Microgrids plus batteries, it’s one of the most important energy solutions to help increasing the share of Renewables.
Yet Battery Storage not only helps to increase the share of renewable power in the system. They also help to secure supply in critical times, and further reduces grid constraints and peak demand.
Thus, industrial clients increasingly turn to battery storage to maintain security of supply and reduce grid costs by peak shaving. One of the latest companies to turn to battery storage for peak shaving was Shell Canada, which just installed two #batterysystems at its Brockville and Sarnia facilities.
News magazine energy storage reported in November that Convergent had completed the projects.
At the Brockville facility, Convergent installed a 1-megawatt/1-megawatt-hour battery for the Shell lubricants factory. At Sarnia, the New York-based developer and asset owner confirmed it had activated another 10-megawatt/20-megawatt-hour battery system.
The idea is to use these systems mainly for reducing demand at peak times, e.g. peak shaving. This helps to reduce stress on the grid and reduces demand charges for Shell, creating a win-win situation. This comes as the Ontario power market is different from the US market as it also hits larger customers with demand charges, not only SME clients, charging them based on the five single hour peaks during the year (on five different days). Any company that can reduce peak demand has a huge financial advantage.
Yet Shell does not stop in Ontario. The company is also investing in a battery system at its Tabangao refinery in Batangas in the Philipines. There, a 3 MWh battery system will support a 3 MW solar PV system to increase the renewable share at the refinery.
This means, behind the meter microgrids + batteries not only provide back-up power in case of emergencies, but also help to reduce costs of grid supply by lowering demand charges.
In the US, such systems benefit more the utilities than large clients, as the help to reduce peak demand on power lines into certain areas of supply. Therefore, we see these systems more deployed by utilities such as Snohomish Public Utility District, or Austin Power, as they help the utility to avoid grid expansion.
And then there are hybrid projects, where the battery acts as both peak shaving device and back-up. SPUD is looking for that solution at its Arlington project. The battery system there acts both as emergency power generator for the dispatch center and as help against grid bottlenecks.
The SPUD project differs from the other projects also, as it uses both Lithium-Ion and Vanadium redox flow batteries for testing the technologies. Lithium Ion batteries are currently covering over 90% of the market, yet refineries would be ideal clients for Vanadium redox flow as they have the expertise in handling the acid chemicals which is required for this technology (HCL). Vanadium redox flow batteries are supposedly better suited for daily cycling, which will occur in peak shaving operation as you try to limit your power demand to a certain pre-set limit, which might require daily discharge.
We will certainly see more of these systems in behind-the-meter applications as clients get smarter in finding benefits and more experienced in operating such systems, be it Vanadium or Lithium-Ion. And we need more such systems to increase the share of renewable power in the grid.
Also, as we see more storm induced outages, and as utilities start to offer resilience as a service to keep the lights and IT services going, will see more utilities investing in such systems to improve security of supply. This leads to the question: Is a regulated utility allowed to offer such services, or does this business belong to ESCO’s? Or, shall this business be left to battery companies?
Yet for now, let’s hope more large companies follow the lead of Shell. Especially in countries with huge demand growth, where both the companies and the environment benefit. Which is nice for everyone.