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Study: Batteries are coming to N.C., but how many, how soon depends on policy

PHOTO BY Alan Jones / Flickr / Creative Commons

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When it comes to energy storage, “there’s a big range of potential futures out there,” one researcher said.

Batteries that kick in when the sun sets or the wind dies down — but also don’t break the bank — have long been seen as the holy grail of carbon-free electricity. Now, a new study out of North Carolina State University shows they’re no myth.

Analysts say that batteries already make economic sense for certain uses today in North Carolina, and that if trends continue, by 2030, 5 gigawatts of large-scale battery storage will be well worth the investment.

“There are combinations today that are cost-effective, and for others we are right on the cusp,” said Jeremiah Johnson, an associate professor at N.C. State and one of the report’s authors. If battery costs plummet as expected in the next 10 years, he said, “we might see a very big change in a very short time.”

Five gigawatts would be enough to displace numerous fossil gas plants, a concept that’s more than theoretical: Duke Energy is at work now on a battery project in Hot Springs after regulators rejected its bid to build a gas plant in nearby Asheville.

Still, Johnson and clean energy advocates say the degree and speed of battery deployment will depend heavily on state policy, especially when it comes to home-sized batteries paired with rooftop solar panels.

“It’s not a foregone conclusion,” Johnson said of the dramatic surge in storage. “There’s a big range of potential futures out there.”

‘A challenging market’ for energy storage

Falling prices, the desire for a lower carbon footprint, and the allure of energy independence have helped small batteries like the Tesla Powerwall gain popularity of late. But the vast majority of battery storage remains “in front of the meter” — owned not by homeowners and businesses with rooftop solar, but by electric utilities.

Today North Carolina has about 1 megawatt of battery storage, mostly in the form of microgrids, self-sustaining energy systems that can disconnect from the larger grid. Two are run by nonprofit rural electric cooperatives, one on the Outer Banks and another in Harnett County about 30 miles south of Raleigh. The Brunswick County co-op is building a third microgrid on the coast near the South Carolina border, and the city-owned utility in Fayetteville plans a fourth.

Duke, the utility covering most of the state, has three battery-backed microgrids: two near its Charlotte headquarters and one in the Smoky Mountains. In October, the company announced it would build 300 megawatts of battery storage in both Carolinas over the next 15 years, including its microgrid with a 4-megawatt battery in Hot Springs.

These efforts lag behind those in regions where there’s competition in the electricity marketplace and an independent, multi-state grid management organization. The PJM distribution market, for example, which covers the Mid-Atlantic and parts of the Midwest, already boasts 278 megawatts of battery storage, according to federal government data.

“The Southeast in general is a more challenging market,” said Diane Cherry, engagement director with the North Carolina Sustainable Energy Association. “We’re vertically integrated, we’re not restructured, we’re not part of a [regional transmission organization], and we have lower energy prices.”

Given these factors, Cherry’s organization convened a working group in 2016 of advocates, utility representatives, renewable energy developers and others to determine how to boost storage deployment. But, she said, “it became clear that a study was going to be needed to really look at the values of energy storage, and how to get the price and market signals correct in the state.”

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