Tackling the Business Case
For Energy Storage
Energy Storage - Ready to Help Manage
Renewables, Demand Response, and
Improve T&D
Alaska Energy Storage Workshop
Anchorage, AK
June 20, 2012
America’s Cooperative Research Network
Membership established CRN to Monitor, Evaluate
and Apply Technologies that:
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Over 900 co-ops
Serves 42 million Americans in 47 States
Covers 75% of nation’s land mass
Owns 42% of all Distribution Line
Totals 2.4 Million Line Miles
Powered by 55,000 MW
Delivers 178 billion kWh of generation annually
Improve Productivity
Enhance Service
Control Cost
Timely Energy Innovations
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Safety
Information
Regulations
3
NRECA Technical Teams are Member Driven
Our Goal is to Help Clear the Hurdles
 We start by listening – what challenges
are faced?
 Next we find and vet solutions and
identify the hurdles
 Research is then directed at moving
the solutions past the hurdles through
support for
Development
Demonstration
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Deployment
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Solar Options
DFA
Advanced
conductors
Solar PV Deployment
Renewable &
Distributed
Energy
DG Interconnection
Edge Voltage
Control
Compressed Air
Storage
Superhydrophobic
Coatings
Electricity from
biomass
Electric Vehicles
Energy
Innovations
Distribution
Operations
Dist. Automation
Advanced Batteries
LED Lamps
Multipollutant
Control
Energy Efficiency
Program Design
Cycling Damage to
Coal Plants
Demand Response
Models
Coal Ash Refining
Center for Energy
Innovation0
Fuel Cells
Generation
& Fuels
Microturbines
MultiSpeak®
SCADA
Transmission
& Substation
CVR
Remote Sensor
Technology
Integral Disconnect
Secure Software
Development
Smarter Grid
Fuzz Testing
Cloud Computing
Open Modeling
Framework
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Research
Pure science
Development
To
Applied science
Applied science and bench
and bench
To
Prototypes and
1st generation
products
Demonstration
Refinement,
“hardening” of
technology and
the mechanics
of getting
technology to
the grid
Deployment
Accelerating
wise adoption –
Making the
technology
practical and
accessible
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Multi-Pollutant Control
Distribution Fault Anticipation
Superhydrophobic Coatings
LED Agriculture Lighting
Estimated Life of EE Improvements
Next Generation Utility IT
Secure Software Development
2012
Research
Projects
Energy Storage Breakthroughs
 Longer Life - 5,000 to 10,000 cycles now possible
 Costs have decreased by over 50% with multiple value streams now
providing payback in less than five years
 Large battery complexes are being built in >1 MW
 Acceptable efficiency of 70% or more
 Multiple value streams are possible
– Peak shaving
– Frequency regulation
– T&D asset deferral
– Minimize cycling and two-shift damage
from renewables to fossil plants
Renewable Energy Hurdles
 Economics Relative to Traditional
 Intermittency
 Integration
 Location, Location, Location
 Regulatory Mandates
 Member Expectations
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Energy storage has huge potential, but there
are too many choices and not enough
knowledge.
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
Cooperatives and Energy
Storage
History of ES Projects
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Recent projects
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McIntosh CAES
Golden Valley NiCad system
Crescent Electric BESS
Kauai PV firming
Kotzebue wind integration
Midwest EC distributed energy storage
Others
Ongoing research efforts
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–
Energy Storage Handbook in coordination with DOE / Sandia / EPRI
Co-op specific Energy Storage Toolkit
There is a groundswell of interest, but lack of in-ground
demonstration is a hurdle.
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Energy Storage Hurdles
 Technical uncertainty, changing technology
 Business case is not well understood
 Limited experience in real-world systems
 Specific utilities require specific solutions
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National Cooperative Energy
Storage Deployment Initiative
Standardized
Designs
Consolidated
Financing and
Purchasing
• Listen to co-op needs
• Work with vendors to develop a set
of designs
• Optimize install requirements
Experience transfer to
the entire cooperative
network through
dedicated outreach
Nationwide pilot
program across a
range of applications
• Work with CFC, Co-Bank others to
develop business models
• Use National Purchasing Program to
get economies
of scale
Leverage cooperative strengths and existing resources
to gain experience for the whole community.
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Storage Evaluations
 Many companies and technologies choices
 Wide range of applications
– Short-duration needs (high current inrush for motor
start, frequency regulation, ramp requirement of
renewables)
– Long-duration needs (peak shaving, storing
renewables)
 Focus on your needs and the value streams first, the
technology choice second
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Storage is Different
 Cycle life/discharge pattern of the energy storage system
is critical. (i.e., map out how the storage will be used)
 Nomenclature – kWh, MWh, kW-h
Evaluate energy storage using discounted cash flow
analysis of the multiple value streams and not cost of
electricity.
CRN working with co-ops to develop an RFI and
RFP for purchasing an energy storage system.
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Possible Value Streams
For Energy Storage
Assuming low penetration of renewables
 Trim Daily Peaks
 Capacity credit or demand charge reduction
 Frequency regulation
– (higher $$ in pay for performance for energy storage)
 T&D capital asset deferral
 Avoid new distribution transformers or transformer banks
 Avoid line reconductoring and new lines (big $$$$)
Possible Value Streams
For Energy Storage
Assuming low penetration of renewables
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
Arbitrage value
Firming and Shifting Renewables

Improve thermal plant efficiency/reliability

Reduce CO2 emissions from thermal plants

Reduce congestion and line losses

Eliminate rapid ramp rate requirements
Additional Value Streams
For Energy Storage
Assuming high penetration of wind, such as >10% wind energy
 Avoid damage to coal-fired power plants
 Prevent spilling of wind energy at night
 Additional need for frequency regulation
 Dynamic VAr support
 Improved service reliability
Emerging Storage Technologies
 Lithium-Ion & Lithium Titanate Batteries - Expensive but
costs dropping, acceptable cycle life, used for short bursts
(spinning reserve, frequency regulation, managing high ramp
rates)
 Advanced Lead Acid – Improved cycling vs. traditional lead
acid, but still low cycle life. Potential lower cost option
 Zinc Air – Potentially low cost, but in early stage of
development
 Ultra-Capacitors (UCAPs) – Potentially lowest cost option, but
in early stage of development
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Emerging Storage Technologies
 Dry Cell Battery Technology – Low cost for short
duration storage and acceptable cycle life
 “Flow” Batteries – Megawatt scale, excellent cycling
and low cost, but mechanically complex systems
 Isothermal Compressed-Air Energy Storage (ICAES) –
Potentially very low cost that could make 100 MW+
scale storage possible
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Silent Power
 Customer-Sited Distributed Energy
Storage (Smart Grid Demo)
 Modular units -- 5/10 kW power with
10/20 kW-hr storage (2 hours)
 Cycle life of 1000 -5,000 cycles (80/10)
 Customer benefits include backup
power as a UPS and renewable
integration
 Potential utility benefits include ability
to store excess renewable energy and
be dispatched for short- term demand
response and peak shaving (for two
hours), and manage motor start-up
loads
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KEA-CRN Demonstration Objectives
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Manage the intermittency of Wind to reduce the number of diesel
generator startups
Eliminate the spilling of wind
Reduce diesel fuel consumption
Provide local voltage and frequency regulation support
Provide spinning reserve
Increase the Penetration of wind to nearly 100%
CRN monitoring performance, economics, and documenting the value
proposition
ASSESSING SMART GRID BENEFITS:
THE OPEN MODELING FRAMEWORK
and STORAGE
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Hurdle: What’s the ROI?
 Technical uncertainty, changing technology
 Lack of consistent analytical tools
– Period modeled
– Factors considered
– Underlying assumptions
– Algorithms
– Metrics
 Different approach necessary for different technologies – e.g., DG vs. CVR vs. Storage
Comparing analyses done with different models is inherently risky.
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Open Modeling Framework
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output
Module
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Monetization
& Visualization
Module
OMF: Technology Modules
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output
Modules
Monetization
& Visualization
Module
The Technology Modules are being derived from existing models, refined to
use the same or similar inputs and to produce common engineering outputs.
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OMF: Reference Input Module
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output Module
Monetization
& Visualization
Module
The Reference Input Module contains a refined superset of the data used
by the complete set of technology modules – refined to remove duplicative
data.
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OMF: Source Data Module
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output
Module
Monetization
& Visualization
Module
The Source Data Module provides links to basic source data such as the
National Climatic Data Center and F.W. Dodge.
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OMF: Reference Output Module
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output
Module
Monetization
& Visualization
Module
The Reference Output Module collects the output from the technology and
grid modules in a standard framework. These are typically direct costs
rather than ROI, IRR, or calculated metrics and engineering impacts.
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OMF: Monetization &
Visualization Module
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output
Module
Monetization
& Visualization
Module
The Monetization & Visualization Module takes data from the Reference Output
Module and converts these into cost/benefit analyses displayed in tabular and
graphical form. AND – it facilitates comparison of different analyses.
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OMF: Grid Modules
Source
Data
Module
Reference
Input
Module
Technology
Modules
Grid
Modules
Reference
Output
Module
The Grid Modules are built around GridLab-D.
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Monetization
& Visualization
Module
Value to G&T
Ex.: Value To G&T Assuming High
Penetration of Wind
$10,000
$9,000
$8,000
$7,000
Freq Reg Svs
$6,000
NPV $/kW @2%
PPC ZnBr
GCAES
Arbitrage
$5,000
T&D def
$4,000
Mitigate Cycling
$3,000
Peak Shave
$2,000
$1,000
$0
Low
High
Range of Inputs
Ex.: Value of Energy Storage
To Distribution Cooperatives
Value to Dist Coop as LSE
$14,000
$12,000
$10,000
Freq Reg Svs
$8,000
Arbitrage
NPV $/kW @ 2%
T&D def
$6,000
Mitigate Cycling
PPC ZnBr
GCAES
$4,000
Peak Shave
$2,000
$0
Low
High
Range of input value
Conclusions
 Energy Storage requires multiple value steams, which can pay for the
installed costs of a unit.
 Energy Storage offers more value to distribution cooperatives than G&Ts.
 Energy Storage is cost effective today when the right applications are
paired with an appropriate technology.
 Energy Storage is essential to manage renewables.
Co-ops likely to be early adopters.
Possible Risks and Cautions
 Technologies are changing rapidly, so difficult to pick
a winner
 Promising technologies can fail due to corporation
failings
 If Energy Storage is sited for delaying T&D assets, it
must be mobile to prevent being stranded in the
future
Energy Storage Resources
 CRN partnering with Sandia National Lab and EPRI
 Revision of popular Handbook
– Application first, then technology
– Financial analysis tools
– RFP template
– Database of technologies
CRN to offer additional evaluation tools and sample RFPs as part of an
“Energy Storage Toolkit.”
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Timely Energy Innovations
www.nreca.coop
Tom Lovas
NRECA/CRN
Arlington, VA
tom.lovas@nreca.coop
Back-Up Slides
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Lithium-Ion & Lithium Titanate
Attribute
Rating
Capital cost
Fair at $600/kW-hr or
$4200/kW-7 hours
Round-trip efficiency
90% to 95%
Lifetime in Cycle Life
4,000 to 16,000 deep
cycles
Altair Nano 1 MW System
Indianapolis Power & Light’s
Altair Nano Lithium Titanate
2 MW/500 kW-h
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EOS Energy Storage (Zinc Air)
Attribute
Rating
Capital cost
Excellent at $160/kW-Hr
or $2000/kW-7 hours
Round-trip efficiency
~65% to 70%
Lifetime in Cycle Life
2,000 to 10,000 deep
cycles
Ultra-Capacitor
1st Lighten the Load Inc.
Attribute
Rating
Capital cost
Excellent at $50/kW-hr
to $150/kW-hr or
$650/kW-7 hours to
$1500/kW-7 hours
Round-trip efficiency
~90%
Lifetime in Cycle Life
>>10,000 deep cycles
Xtreme Power’s Dynamic Power
Resource Battery (Dry Cell)
Attribute
Rating
Capital cost
Fair at >$1000/kWhr or ~$7000/kW-7
Hr
Round-trip
efficiency
Lifetime in Cycle
Life
80% to 85%
1,000 cycles at 100%
DOD and 100,000
cycles at 20%
discharge
Dry Cell with proprietary formulas of fundamental
alloys, such as copper, lead and tellurium
Xtreme Power website
Premium Power Corp’s
Zinc Bromide
Attribute
Rating
Capital cost
Excellent at $270/kWhr or $2000/kW-7 hr
Round-trip
efficiency
68% to 70%
Lifetime in Cycle
Life
Est. 10,000 deep cycles
Premium Power Corp. TransFlow-2000
Modules
General Compression Isothermal
Compressed Air Energy Storage (ICAES)
Attribute
Capital cost
Rating
Excellent at $1000/kW
for 10 hours and
$10/kW-hr
Round-trip efficiency 75% to 80%
Lifetime in Cycle Life
No known limitation in
cycle life
Sited in salt beds. Seasonal wind storage possible
(100+ hours). Less than 1 second response.
ICAES Geologic Locations Relative to Class
IV Wind Resources (in Blue)
General Compression