Cost-effective battery energy storage would be a game changer for the electricity industry. Electricity infrastructure was built to manage the significant fluctuation in energy consumption, both throughout the day and throughout the year. Generation assets are designed to support varying types of demand, either base load, mid-cycle or peak demand levels. Similarly, the existing transmission and distribution infrastructure is built to accommodate the peak demand needs of customers. Cost-effective energy storage devices, such as batteries, could dramatically change existing planning parameters and applications of our assets.
AEP's Electric Transmission Texas’ 4-MW NAS® sodium-sulfur battery system located in Presidio, Texas.
The cost of energy storage exceeds what the market will support for broad-based application, at least for the foreseeable future. The technology is being developed and improved. The Energy Storage Program, led by the Department of Energy, is studying a wide range of energy storage technologies and high voltage power electronics to demonstrate their cost and benefits.
It’s unlikely that consumers will soon pair distributed generation with battery storage and completely go “off the grid.” DG users would still need the services the grid provides. According to Moody’s, DG customers could go “off the grid” only if they had sufficient battery storage to support two months of energy consumption. Even if customers were to attempt to “go off the grid,” they would likely need to rely on the grid to supplement their power requirements when starting motors in appliances such as air conditioners and other appliances.
In its report, entitled “Batteries are coming but utilities are not going away,” Moody’s concludes that mass defection of customers from the electric power grid is a “minimal risk and not a material threat.” The report cites the capital cost of batteries as still too high for consumers and other constraints that would limit growth. In addition, not all customers have the physical space, proper exposures, or available access to sufficient or affordable capital or credit quality to consider such arrangements. The convenience, cost benefits and reliability of receiving electricity from the power grid is not something consumers are likely to forego in the near-term.
AEP has experience with utility-scale energy storage. In 2006, Appalachian Power Company (APCo) commissioned the first megawatt-class NaS battery to be used in North America in Charleston, W.Va. These batteries can supply 7.2 megawatt-hours of energy, helping to ensure reliability to the area. This technology allowed APCo to defer building a new substation for several years. However, the battery was removed from service.
In 2008, a 2-MW NaS battery was installed at a new station in West Virginia, and is supplying energy on the distribution system to help relieve the load burden at another substation. This battery has the capability to provide service to up to 700 customers for up to 7 hours when power is interrupted due to an outage.
In 2010, AEP’s Electric Transmission Texas installed a 4-MW NAS® sodium-sulfur battery system in Presidio, Texas, to provide transmission backup in the event of a transmission line outage. This system was designed to improve power quality and reduce voltage fluctuations in the Electric Reliability Council of Texas region. This demonstrates the progress that is being made on commercial-scale battery storage and shows how valuable energy storage is to a flexible grid.