Arizona Public Service is getting out ahead of the curve by providing battery storage devices to a finite set of consumers with solar rooftop panels. It’s trying to figure out how such storage devices will impact the demand for electricity.
Can utilities like Arizona Public Service adapt to emerging innovations that allow customers to “bypass” their services? Or, will power companies become the modern-day dinosaur? The trend is toward more independent customers who are able to generate their own electricity — all spearheaded by advancing technologies that are becoming cheaper and more effective. But just how all it all “ends” cannot yet be forecast.
“How do these devices integrate to enable peak demand reduction and smoothing?” asks Scott Bordenkircher. Director, Technology Innovation & Integration at Arizona Public Service, who spoke at Siemens energy conference in Boston last week. “We could wait and see what would happen or we get ahead of it and do what needs to be done.”
He admits that batteries used to store electrons and to release them later on when the weather does not permit are not now cost effective. At this point, such a use is more suited to really rich people and businesses. What is cost effective, though, are utility-scale storage devices, he says. Those devices are used to smooth out the voltage, or to prevent the lights from flickering out.
In the case of Arizona Public Service, it will examine the integration of rooftop solar with advanced energy-related technologies like home energy management systems, battery storage and smart thermostats.
As panel prices nosedive and as homeowners are given more financing options, the demand for solar is surging. Without battery storage, however, those solar PV panels can only be accessed when the sun is out.
By contrast, the benefit of utility-scale storage that connects to the grid is that it can deliver power more efficiently — not one house at-a-time. Still, construction costs are high and it requires a hook up to either a more modernized or a more extensive transmission grid, which remains a tough sell.
But consumer demand and public policies are creating ever-larger markets for solar. Solar installations here jumped by 43 percent in the second quarter of this year, reports the Solar Energy Industries Association. More than 2,000 megawatts solar were installed.
To be clear, that is utility-scaled PV, which generates solar power that feeds into the grid. It is different from rooftop solar that generate power for homeowners and businesses. Earlier this year, the nation recorded its 1 millionth residential rooftop installation — a market has grown by 29 percent a year in the last few years. It is expected to hit 2 million in two years, the solar association adds.
“We’re seeing the beginning of an unprecedented wave of growth that will occur throughout the remainder of 2016, specifically within the utility PV segment,” says Cory Honeyman, GTM Research associate director of U.S. solar research.
“With more than 10,000 megawatts of utility PV currently under construction, the second half of this year and the first half of 2017 are on track to continue breaking records for solar capacity additions,” he adds.
If energy storage proves itself in the market, it would mean a brighter future for renewable energies that are considered intermittent power sources.
California aims to advance the cause: The California Public Utility Commission now requires PG&E Corp. San Diego Gas & Electric and Southern California Edison to collectively buy 1,325 megawatts of energy storage by 2020. California’s focus is on reducing harmful air emissions and on increasing the state’s use of green energy. An application could be anything from cutting energy use to storing and injecting electrons onto the grid.
“Storage enhances that value and provides smooth power that can be more easily dispatched,” says James Mandel, manager at the Rocky Mountain Institute, in an earlier interview. “At a system level, you minimize capital investment and it is all done in a cleaner way … It seems to me that this day will come sooner than people think — a decade or two, on the West Coast.”
“You can’t look at wind and solar as the enemy,” adds Charles Bayless, former chief executive of Tucson Electric, in an interview. They still needs to reach grid parity, he notes, but that investment in those technologies will continue to bring down prices and make green energies a lot more cost competitive.
Given the recent advances of the solar sector and the increasing demand for those services, utilities like Arizona Public Service are wise to explore those options for themselves. Having solar panels is one thing. But being able to store those electrons is another. The concept still has a ways to go but from the today’s vantage point, solar plus storage will take root in the not-too-distant future.