Energy-Storage Plans Gain Ground in California
DEC. 21, 2014
By MATTHEW L. WALD
New York Times
In an unusual competition in California, proposals for energy storage systems beat out hundreds of bids to construct new power plants as a way to meet peak power needs.
Southern California Edison has retired its San Onofre nuclear reactors and is planning to retire natural gas units with environmentally troublesome cooling systems. So it invited proposals for storage — including conventional batteries and giant ice packs — and new gas-fired power plants.
To the surprise of the utility and even the storage companies, in many cases storage won. Demand response, or agreements with customers who volunteer to be unplugged at certain times, also did well.
Looking for 2,221 megawatts of capacity, about the size of two big nuclear plants, the utility selected 264 megawatts of storage, a huge amount for what is still viewed as a fledgling technology.
"It’s much more than we thought would be likely," said Colin Cushnie, the utility’s vice president for energy procurement and management. The total is about four times all the storage the company now has in place or under construction, he said.
It is also extremely large relative to an order issued last year by the California Public Utilities Commission that investor-owned utilities install 1,325 megawatts of storage by 2020.
The bidding results indicate that the cost of storage is falling, experts say, although neither the utility nor the companies whose projects were selected would say what price the utility would pay. And the value of storage varies by location, with California an extreme case. Because of wind farms, the state has very cheap energy available at night, some of which now goes to waste.
The alternative, new generators running on natural gas, is particularly expensive in the Los Angeles area because of strict air emissions limits and high land prices. (Batteries take up less space than power plants.)
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