Large Scale Energy Storage with Batteries for Grid Stabilization and Renewable Energy Integration

Large scale energy storage with batteries for grid stabilization and renewable energy integration

Herwig A. Ragossnig Head of Business Development LATAM [email protected]

NEC Energy Solutions is a full service, end-to-end turnkey energy storage solution and battery systems provider

Offering energy storage systems, technical and economic project analysis, installation and commissioning, operation, maintenance, equipment warrantees, performance guarantees, and financing

Batteries

Power Controls Conversion

Balance-of- Services Plant

Performance Warranty Guarantees

Financing

• What’s included in a turnkey energy Energy storage solution? storage • Equipment – Everything required to interconnect to the grid and operate: – Energy storage – Thermal mgmt (as needed) Thermal – Power conversion management – Controls – Transformers/switchgear (as needed) • Service and Maintenance Programs • Warrantees and Performance Guarantees Power – Equipment warrantees Controls conversion – Availability or uptime guarantee – Energy storage capacity guarantee – Power capacity guarantee • 35kV What to expect? Example: Availability – EAF – Availability > 96% PoC • *EAF = Equiv. Availability Factor – (Available Power/Nameplate Power) x 100 – Incorporates Design and Performance

10 MW/5MWh OVER 250MW 40 MW/22 MWh 2017 400 kW/100 kWh Installed, under construction, or in late stages of development 2017 8 MW/2 MWh 2010 20 MW/5 MWh 2 MW/500 kWh 2011 2 MW/3.9 MWh 2013 2.5 MW/ 5 MWh 2008 350 kW/700 kWh 2016 2013 2013

1 MW/1.2 MWh 1 MW/2.8 MWh 2017 2.5 MW/3.9 MWh 2 MW/500` kWh 2014

2015 2013 48 MW/51 MWh

2017 2 MW/ 2 MWh 32 MW/8 MWh 2014 500 kW/1.2 MWh 4 MW/1 MWh 2011 1 MW/3 MWh 11 MW/4.4 MWh 2016 2011 2013 2012 1 MW/1 MWh 400 kW/400 kWh 2013 12 MW/4 MWh 2017

2009 Frequency Regulation 500 kW/125 kWh 2 MW / 500 kWh 280 kW/135 kWh Renewable Integration 2013 2013 2014 2 MW/2 MWh 20 MW/5 MWh Primary Reserve 2017 2011 T&D Support

• Westborough NEC Energy Solutions St. Luis Missouri Mass. Headquarter in

Global Energy Hard& Software Global Energy Westborough, MA controls Storage HQ

• Branch office in St. Luis NEC Colombia for controls NEC Mexico • NEC´s regional NEC Brazil presence in all Americas with NEC Chile additional branch offices in Costa Rica, NEC Argentina Peru, Ecuador

• Today’s grids require more flexibility to address: – Increased renewable generation • Compensating for variable energy resources – Changing load patterns • Generation now distributed to load centers (PV) • EV chargers shifting consumption patterns – Aging transmission and distribution network • Infrastructure is aging and needs reinforcement • Upgrades in urban environments can be difficult • Energy storage in the grid is a powerful tool – Increase capacity utilization for generation, transmission, and distribution infrastructure

Discharge

Storage Day Time Night Time

• Frequency Regulation • Peak Load Shifting • Primary Reserve • Renewable Integration • Renewable Integration – Firming, Shifting & Curtailment Recovery – Ramp Management • Arbitrage • Requirements: • T&D Support – High charge/discharge rates • Requirements: – Short duration (<1hr) – Low charge/discharge rates – Many cycles (100’s per day) – Long duration (1+ hrs) – Continuous use – 1-2 cycles per day

➢ Frequency Regulation ➢ Voltage Support ➢ Upgrade Deferral ➢ Frequency Response ➢ Dynamic Line Rating Support ➢ Community Energy Storage ➢ Renewable Integration ➢ Renewable Integration ➢ Microgrids ➢ Power Plant Hybridization ➢ Upgrade Deferral

Improve plant efficiency and output, Increase grid reliability, increase Improve power quality, increase lower O&M costs, and decrease asset efficiency and utilization, asset efficiency and utilization, smart plant emissions, with no water enable wind and solar, defer grid ready; aggregation and consumption, no emissions of its upgrades to transmission assets. automation, defer upgrades and own, and rapid deployment support distribution assets. capability.

Providing benefits throughout the electricity supply chain

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Frequency Response Grid electricity frequency must be maintained • Value Added by Energy Storage • Because of its fast, almost instant response it is more effective in providing frequency response. • Can ramp up and down much faster and easier than traditional generators – Nearly “vertical” ramp rate, well under 1 second to full output – Generators can take several minutes to get to full output – No ramping wear-and-tear, unlike fossil fuel generators • No shutdown/startup damage, unlike fossil fuel generators Note: The GSS™ is NEC Energy’s Grid Storage Solution, which contains energy storage, power conversion to change AC electricity to DC and – Can operate at zero with no penalty back, and a controls system to operate the entire GSS on the grid.

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Frequency Response Grid electricity frequency must be maintained • How does energy storage work in a frequency response situation?

Grid Disturbance + Energy Storage = Reliable Power

Power

Power Power

Time Time Time

Loss of generation or Energy storage can provide The result is more reliable transmission can cause a vertical ramp response to power from better frequency to drop quickly – frequency deviation and frequency response. this disturbance must be also respond more contained and corrected. consistently than traditional generators for better frequency containment.

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Frequency Regulation Grid electricity frequency must be controlled Did you know? FERC Order 755 in the • How does energy storage work in frequency regulation? USA reformed the frequency regulation – Energy storage resources can follow the control signal almost market, creating a “pay- perfectly! for-performance” rule.

1.00 Due to the fast response and vertical 0.80 ramping capability of 0.60 energy storage, the 0.40 frequency regulation The control signal is shown in blue. The 0.20 control signal can be energy storage response in red shows the actual followed almost 0.00 perfectly. This power output achieved.

The control signal (blue)

00:03 00:16 00:38 00:01 00:04 00:06 00:07 00:09 00:10 00:12 00:13 00:15 00:18 00:19 00:21 00:23 00:24 00:26 00:27 00:29 00:30 00:32 00:33 00:35 00:36 00:39 00:41 00:42 00:44 -0.20 00:00 provides a much is barely visible, since the higher performance -0.40 response overlaps nearly resource than perfectly! traditional generation. -0.60 Reg D -0.80 Real Output -1.00

• Value Added by Energy Storage Did you know? – With fast responding, precise, accurate frequency regulation (like PJM has reported that the that provided by energy storage, grid operators actually need to total money spent on frequency regulation today procure LESS frequency regulation service than before! is less than what it used to spend, based on its “pay- for-performance” reform (FERC Order 755) of the frequency regulation In PJM, the ‘benefits factor’ market in October 2012. for fast responding resources It is well recognized that for frequency regulation, like fast responding, accurate that provided by energy resources like energy storage are the most storage, is about three times effective tool for frequency that of slow, traditional regulation. resources. That means that 1MW of energy storage frequency regulation is worth

3MW of traditional frequency Frequency Regulation Effectiveness Regulation Frequency regulation! 1MW GENERATOR 1MW ENERGY (nameplate rating) STORAGE (nameplate rating)

▐ Located at the Los Andes substation ▐ Primary Reserve “the Los Andes battery energy storage ▐ 12MW Power Capability system is one of the best performing ▐ 4MWh Energy Capacity reserve units in Northern Chile” ▐ 8 Battery Containers -CDEC-SING, system operator in Northern Chile ▐ Integrated Inverter and Cooling ▐ Operational since 2009

▐ Located at Angamos Substation ▐ 5 Inverter Containers with Integrated ▐ Primary Reserve Transformers ▐ 20MW Power Capability ▐ External Chillers ▐ 5 MWh Energy Capacity ▐ Operational since 2011 ▐ 10 Battery Containers

The International Recipient of the 85th Annual EEI Edison Award

CDEC-SING Fault Report No. 2777, June 3, 2011

CDEC-SING Fault Report No. 2580, October 22, 2010

– Intermittent renewable generation is due to variability in the renewable “fuel” – in this case, sunlight blocked by passing clouds. Grid system operators desire commitment for constant power output to minimize the need for other resources in their system, for instance a combined-cycle gas turbine or a coal plant, to ramp up and down, which can increase their emissions and operating costs. With enough non-firm and intermittent generation like wind and solar, greater investment in flexible ramping resources is required. In some cases, more coal plants, gas turbines, or peaker plants need to be installed to complement the renewable generation – the very fossil fuel resources they’re meant to displace!

Did you know? • Value Added by Energy Storage The term “capacity” is frequently used – Energy storage can perform renewable capacity firming by storing referred to as a generator’s power energy from peaks or from other baseload resources and using it to output capacity, typically in fill valleys in renewable generation output megawatts (MW). However, in the – Allows intermittent battery world, the electric supply resource term is used primarily to such as wind or solar to describe the ampere-hour (Ah) be a firm, constant capacity of the power source – avoiding battery or cell! penalty fees and creating a steady contract revenue stream. – May reduce power-related charges (for example capacity payments or demand charges), or it may offset the need for equipment such as peaker plants. Source: SANDIA Report SAND2010-0815, Energy Storage for the Electricity Grid: Benefits and Market Potential Assessment Guide, Jim Eyer & Garth Corey (February 2010)

• Value Added by Energy Storage – How does energy storage work with non-firm renewable capacity?

Intermittent PV + Energy Storage = Firm Renewable Capacity

Power

Power Power

PV solar farm Time Time Time

PV is intermittent – passing Energy storage can fill in the The net result? Firm clouds cause power output valley with previously renewable capacity – to drop quickly. When the stored electricity. consistent power output cloud departs, electricity from a PV array even when begins flowing again. clouds pass by!

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Renewable Curtailment Avoidance Transmission lines have a limited transport capacity • Problem – Renewable energy is sometimes turned off or “curtailed” to not exceed transmission and distribution capacity limits or balance the generation with the load. This curtailed energy is lost and not sold.

• Value Added by Energy Storage – Using energy storage to capture wind or solar energy under curtailment conditions gives the system operator more flexibility to manage oversupply or constrained transmission capacity and avoid negative power prices. – Avoiding curtailment can also increase the amount of energy generated by renewables, and increase the amount it can sell – Additionally, if renewable generation occurs at a time of negative pricing, storage could actually get paid to charge up!

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Renewable Time-Shifting Sell renewable electricity at peak time for a higher price • Problem – Renewable generation like wind and solar only generate electricity when the wind blows or the sun shines. Many times this does not coincide with the highest price that it can be sold at.

This is a problem with wind which typically blows stronger at night when demand and prices are low, but even PV generation - which typically coincides with electricity consumption - can be exposed to lower demand pricing on the weekends or holidays.

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Renewable Time-Shifting Sell renewable electricity at peak time for a higher price • Value Added by Energy Storage – Renewable energy time-shift can allow optimized revenue with energy storage charging during off-peak times, and discharging and selling the stored electricity during on-peak times. Did you know? An example is shown here for a A commonly used term for time-shifting is wind with energy storage on a “arbitrage”. However, summer day. Wind generation the strict definition of is stronger at night, when “arbitrage” is the simultaneous purchase energy’s value is low, and is and sale of identical used to charge storage. About commodities across half of the energy used on-peak two or more markets to benefit from a is from wind generation that difference in pricing. actually gets generated off- Time-shifting is not the peak. The result is firm, same since the “buy low sell high” constant power for five hours, mechanism occurs at being sold at a higher price (on- two different times peak time) as compared to a separated by several hours, and are not lower price (off-peak time). simultaneous. Source: SANDIA Report SAND2010-0815, Energy Storage for the Electricity Grid: Benefits and Market Potential Assessment Guide, Jim Eyer & Garth Corey (February 2010)

• Problem – Renewable generation output is variable and can change rapidly. This rapid power ramp can cause instability on the grid. – Some grid system operators impose a ramp-rate limit on generation, and generators violating this limit incur penalty fees or be prevented from

even installing their project. Wind generation on islands like Hawaii typically have ramp rate limitations, keeping power output changes to under a certain MW per minute. This is done in an effort to promote a more stable grid environment and one that system PV solar has been faced with these ramp operators can more easily manage. rate requirements – notably, the US island territory of Puerto Rico recently imposed what it called MTR (minimum technical requirements) on any solar panel projects, requiring ramp rate limits.

• Value Added by Energy Storage – Renewable generation can limit up-ramps on its own, but typically cannot limit down-ramps. Energy storage can slow down the down-ramps to meet the limitations imposed by the system operator.

Did you know? While wind and sun are variable and not controllable, it is fairly predictable. In fact, wind generation and solar PV generation can be predicted with good accuracy. However, predictable variation is still… Energy storage can charge when up-ramps are too steep, and variable – so a flexible resource must discharge when down-ramps are too steep. Depending on the compensate for this variation. Energy nature of the wind resource and the wind turbine equipment, storage is a great tool for compensating variability and increasing the stability of relatively short durations of energy storage can mitigate large the grid. amounts of renewable generation. However, energy storage sizing is tricky – consult NECES for more details!

▐ 1 MW Power Capability ▐ Renewable time-shift, VAR ▐ 3 MWh Energy Capacity support, frequency regulation, ▐ One battery container w/ integrated cooling and voltage regulation in ▐ One inverter container mixed-mode operation ▐ Operational December 2013

▐ Located on Maui, Hawaii ▐ 11MW lithium ion energy storage working with a 21MW wind farm ▐ Operational since December 2012

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Transmission and Distribution Support/Deferral Improve T&D utilization • Value Added by Energy Storage – How does energy storage work in a transmission support or transmission upgrade deferral?

Today’s Grid + Energy Storage = Better Use of Today’s Grid

Used transmission capacity Freed transmission capacity

Power Power Power Used transmission capacity

Time Time Time Peak traffic occupies all the Energy Storage can shave The result? The existing transmission capacity but only the transmission peak, grid can now accommodate for a short time. Lots of deferring or eliminating the more transmission, load, or underutilized capacity the need to upgrade the other capacity without remaining time. Transmission transmission line. upgrading lines and other capacity upgrades typically add equipment, and may also 25-50% and drastically increase benefit from life extension. underutilization.

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Voltage Support Keeping power real • Typical Solution – A grid system operator performs Voltage Support by using generators, capacitors, or other devices to create VAR’s (reactive power) to bring everything back in phase or “in line” to maximize efficiency. • Issues – Generators are meant to produce real power to do useful work, not compensate for reactive power problems. Did you know? – In addition, generators are typically located far from where VAR stands for “volt- ampere-reactive”, problems occur, near loads, and transmission of reactive power also known as cannot be done efficiently over long distances. reactive power, it is the complement to the Watt, also known as real power.

©2017 NEC Energy Solutions, Inc. All rights reserved. Proprietary and confidential. Voltage Support Keeping power real • Value Added by Energy Storage – While Voltage Support is already provided by many different resources today, energy storage, paired with the appropriate power conversion systems, can also provide this service. – Energy storage can be located almost anywhere in the grid – including close to specific types of load, like electric motors – that can create an “out of phase” problem. Since reactive power does not travel well over the transmission lines, it is more effective to place Voltage Support assets near the problem, where most large centralized generation is unable to be located. • Note that distributed generation, including ‘smart inverters’ used for distributed PV systems (rooftop solar panels) can provide this service and are also located near the problem

HERWIG A. RAGOSSNIG Head of Business Development for Smart Energy in Latin America Fijo + 56 2 2640 8247 E-mail [email protected] Enrique Foster Sur 20, piso 12 Las Condes, Santiago de Chile