Will the world’s largest storage battery be America’s energy cure?

By John Fialka | 07/07/2016 10:00 AM EDT

By 2021, electricity use in the west Los Angeles area may be in for a climate change-fighting evolution.

AES Corp.'s Laurel Mountain battery complex in West Virginia.

AES Corp.'s Laurel Mountain battery complex in West Virginia. Photo courtesy of AES.

Part two of a four-part series on the nation’s electric power grid. Click here for part one and here for part three.

By 2021, electricity use in the west Los Angeles area may be in for a climate change-fighting evolution.

For many years, the tradition has been that on midsummer afternoons, engineers will turn on what they call a "peaker," a natural gas-burning power plant In Long Beach. It is needed to help the area’s other power plants meet the day’s peak electricity consumption. Thus, as air conditioners max out and people arriving home from work turn on their televisions and other appliances, the juice will be there.


Five years from now, if current plans work out, the "peaker" will be gone, replaced by the world’s largest storage battery, capable of holding and delivering over 100 megawatts of power an hour for four hours. The customary afternoon peak will still be there, but the battery will be able to handle it without the need for more fossil fuels. It will have spent the morning charging up with cheap solar power that might have otherwise been wasted.

Early the next morning, the battery will be ready for a second peak that happens when people want hot water and, again, turn on their appliances. It has spent the night sucking up cheap power, most of it from wind turbines.

The politics for this to happen are now in place because California’s Public Utilities Commission set a target requiring utilities to build their capacity to store energy, to use more renewable energy and to cut the state’s greenhouse gas emissions 80 percent by 2050. The economics are there, too, because the local utility, Southern California Edison Co., picked the designer of the battery, AES Corp., an Arlington, Va., company, against 1,800 other offers to replace the peaker.

It was the first time an energy storage device had won a competition against a conventional power plant.

And the technology seems mature. AES has spent nine years working with manufacturers of electric-car batteries. It has learned how to assemble and control ever-bigger constellations of these lithium-ion batteries. The Long Beach facility, when it is completed, will have 18,000 battery modules, each the size of the power plant of the Nissan Leaf.

But the timing is terrible.

Cheap solar spurring storage woes

John Zahurancik
John Zahurancik, president of AES Energy Storage. | Photo courtesy of AES.

The mega-battery won’t be up and running for five years, and Southern California needs more energy storage capacity yesterday. Officials warn that this summer, the region could face as many as 14 days of scheduled blackouts because of a huge leak earlier this year at the Porter Ranch natural gas storage facility. While the leak has stopped, the facility — which feeds fuel to 17 Los Angeles-area power plants — may not be fully recovered and tested for months.

Meanwhile, other utilities are suddenly feeling the need to store substantial quantities of electricity. As John Zahurancik, president of AES’s energy storage company, put it, "It’s a bit of a Wild West open market right now."

The United Kingdom is shopping for energy storage systems to be installed around London, and New York state, Hawaii and Chile are looking at energy storage as an alternative to building more expensive power plants.

What’s driving this scenario is a growing abundance of cheap solar and wind power and entrepreneurs looking for ways to store and sell more of it. Meanwhile, power projections of older coal- and gas-fired power plants are leading owners to shut more down, leaving more gaps in electricity distribution systems because they will no longer be able to compete with cheaper solar and wind power.

"We’re already caught up in the onset of a major transformation that’s going to happen. There are over a million solar rooftops now" in the United States, explained Guenter Conzelmann, a power sector analyst at the Department of Energy’s Argonne National Laboratory near Chicago.

Within two or three years, he estimates, there could be as many as 800,000 electric vehicles in the United States, an event that could drive prices for lithium-ion batteries further down and result in the storage of more renewable energy in the suburbs, at the edges of power systems that feed cities.

Car companies such as Tesla Motors Inc. are also offering big home batteries, close cousins of their car batteries, to store more renewable energy in homes. There are also "smart" appliances, such as dishwashers, water heaters, thermostats and refrigerators, coming into the market that are equipped to communicate with utilities to minimize electricity use during peak periods when electricity is most expensive.

"Eventually, homeowners could become almost energy self-sufficient. You may only need a few hours of electricity from the grid per year," Conzelmann said.

Noting that the current power grid is not designed to handle big two-way power and communication flows, he suggests that more renewable energy will be beneficial and politically unstoppable.

"Everyone has an end vision. That’s pretty clear," he said. "The problem is, how do we get there? That’s where a lot of the research that’s going on is all about. Can we have all these different attributes that we want without screwing up?"

Large-scale solar batteries go from ‘cute’ to critical

So far, most utilities have finessed the issue of accumulating solar power by allowing homeowners with solar arrays to sell some of their power back to the grid, a practice called net metering.

"You’re basically using the grid as a battery. This is why some utilities are a little bit leery about this. The big question is, who pays for it?" said Haresh Kamath, a senior manager at the Electric Power Research Institute (EPRI), a nonprofit group funded by the electric utility industry.

Big, grid-sized batteries can run into the millions of dollars, but the damages from blackouts and power surges caused by wildly fluctuating voltages can easily run into the billions.

"You can get some interesting effects on the grid which are not good if the voltage gets too high or you get some reliability issues," Kamath said.

The need for renewable energy storage has emerged relatively recently among the engineers who worry about the health of the grid. "Starting off a few years ago, it was a novelty. ‘Oh, that’s cute,’ people would say. You’re trying to do large-scale batteries," said Vince Sprenkle, a chief engineer for energy storage at the Pacific Northwest National Laboratory in Washington state.

Five years ago, he recalls, the Energy Storage Association held its annual meeting in Charlotte, N.C., and 300 people showed up. "This year, they came back to Charlotte, and there were 1,500."

According to Sprenkle, energy storage solutions and timetables will be different for different regions of the United States.

California is already feeling the crunch, but it may not come to the Pacific Northwest for another five or 10 years. Wind and solar power are beginning to penetrate the Northwest’s part of the grid, but when it fluctuates — as it always does — power demands can easily be balanced by the region’s hydroelectric power. Hydroelectric dams, with excess storage capacity and pump storage facilities that pump water up to a hilltop reservoir when electricity is cheap and then run it through turbines when it isn’t, can function like big batteries.

But the demand for more renewable electricity is going up, and the capacity for more hydro is small. Fielding more and bigger batteries may be much cheaper than building new hydroelectric facilities, Sprenkle thinks.

"Ideally, storage is your greatest flexible asset you can put on the grid," he said.

Waiting for big batteries to hit the road

At the moment, utilities are just beginning to use pilot projects to explore how bigger batteries might help them use the nation’s increasingly congested electric highway.

Fittingly, most of these pilots explore the storage uses of lithium-ion batteries. They were invented in the United States and languished for years until Sony Corp., the Japanese electronics company, commercialized them to power tiny machines like video cameras and cassette players.

Soon, they were bringing more power and longer life to cellphones, power tools and model airplanes. And these led to more ambitious commercial experiments. In 2006, Tesla put 6,800 lithium-ion model airplane batteries under the hood of a kit-built roadster. That led to Tesla’s first car, the sporty Tzero, and a small but accelerating movement in the auto industry toward the plug-in electric vehicle.

AES, the Arlington, Va., company that is designing the 100 MW battery to store power for the western region of Los Angeles, was the first to take the next leap in 2010 by bringing lithium-ion car batteries to power one of the world’s biggest machines: the North American power grid.

For reference, the output of 100 MW is roughly a tenth of the power delivered by a modern nuclear power plant.

"We tend to not be focused on pilots, but on more commercial ventures," explained Zahurancik, president of the company’s storage unit.

The parent company owns and operates power plants in 17 countries around the world. It has the money, the expertise and the ambition to create new businesses and partnerships. One of the partners in its earlier grid project, which was based in West Virginia, was A123 Systems LLC, a Waltham, Mass., developer and manufacturer of advanced lithium-ion car and bus batteries.

How refining ‘frequency regulation’ paved the way to LA

In 2010, a caravan of AES trucks hauled a line of 53-foot shipping containers up Laurel Mountain in West Virginia. Blazoned with labels saying "Smart. Power. Delivered," the containers carried 320 A123 electric vehicle batteries. They were parked in parallel rows near a wind farm, whose 61 turbines were generating electricity near the windy hilltop.

More trucks arrived, pulling shorter shipping containers. They contained the transformers, inverters and other control equipment needed to connect the batteries to power lines leading from the wind farm. Other containers had the air conditioning equipment to keep the growing maze of big batteries from overheating. Finally, a master control system was added.

What looked like a wire-strewn commercial parking lot was connected to a substation of what was then Allegheny Power, one of the utilities involved in the massive PJM Interconnection LLC, a regional transmission organization whose lines feed wholesale electricity to 13 states in the eastern United States.

Before 2011, when this giant, outdoor battery was turned on, PJM had run out of pump storage to control the growth of wind power, which accumulates most quickly at night. In some areas, PJM was forced to pay utilities to take wind power to keep its frequency of power delivery balanced. On that point, the grid is very demanding. The frequency of oscillations in its alternating current must be pegged at a measure defined as 60 hertz.

If the current goes above that, the switches protecting expensive power equipment from overloads begin to shut down the system. "If it goes too low, you can start to cause systematic failures that lead to brownouts and other things," said Zahurancik.

What the Laurel Mountain project was designed to do is called "frequency regulation." The wind power stored in the batteries feeds more juice onto the grid when power demands increase. When there is too much electricity coming into the system, its batteries suck more into storage. It can make these adjustments in a second, thus saving the excess power to sell at higher prices the next day. It was good for the grid, good for expanding markets for renewable energy and good for the innovator. It led to bigger jobs for AES, including the Los Angeles project.

"AES has always been a company that’s trying to look at where do you go next. Is there a better way to serve?" said Zahurancik.

Tomorrow: Grid business beckons to outsiders.