New Ameresco energy storage VP Jacqueline DeRosa highlights how the dropping price of energy storage has positioned communities to take advantage of new microgrid models. Community microgrids with energy storage serve to enhance grid reliability, security, and efficiency.
The growth of distributed resources is forcing utilities and grid operators to transition from standard operations to more decentralized power systems. Already, local and clean distributed resources can directly provide a local community’s energy needs. Distributed renewable energy paired with energy storage is not just technically feasible, but also cost-effective for many applications today. New predictive analytics can optimize the use of solar, advanced energy storage, energy efficiency, and other resources to allow communities to procure renewable, low-cost energy and maintain reliability.
While many microgrids to date have been built to serve a specific self-contained campus or large customer, community microgrids combine these new solutions to ensure resilient electric power service to a wide range of customers within a local community when the electricity from the bulk power system is unavailable during a disaster, such as a fire, flood, or a hurricane. These microgrids can also facilitate the integration of local clean energy among an interconnected load from a city, town or neighborhood during non-emergency times.
The main technology enabling the growth of community microgrids is lithium-ion batteries, whose costs have dropped by about 80 percent since 2010. According to the December 2018 BNEF Brief, the “volume-weighted average price of a lithium-ion battery pack is $176/kWh”. The same report stated that “the has price dropped 18 percent since 2017.” This trend is expected to continue with an even more significant decline in the next few years. One reason for this dramatic decrease in price is the growing electric vehicle sales that have prompted the development of giga-factories worldwide and have boosted the economies of scale for lithium-ion battery solutions, thus driving down prices for grid-connected batteries. According to Wood Mackenzie’s latest forecast, about 4 GW of energy storage projects are projected to come online in the United States by 2023.
Technological advances and new business solutions have also expanded the services that energy storage can provide for communities. Given the ease of installation and modular design, stationary storage projects are being developed for diverse applications, including peaker power plant replacement, load following, ancillary services, distribution deferral, and customer bill management. Because energy storage projects can quickly be sited and sized to any level, they can be located and interconnected at a consumer site, near other generation, or near a substation. With its pronounced drop in price, longer duration battery storage can now provide resilience in times of an emergency when there is a prolonged grid outage. A microgrid with energy storage can instantaneously respond and replace the need for traditional backup power systems for when the grid goes down.
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