The installation of a 2-MW battery-based energy
storage system at a retired coal plant in New
Richmond, Ohio, is being billed as a sign of the
growing potential of repurposing shuttered sites for
grid-scale energy storage.
In addition to being completed in record time -
about four months - the Duke Energy project, which
provides frequency regulation services to the
Northeastern PJM market, is also seen as a way for
Duke to make money on a plant it was ready to
The system at the old W.C. Beckjord plant is
designed to instantaneously absorb excess energy
from the grid and release it in seconds, as opposed
to a power plant that could take 10 minutes or more
to ramp up.
"These are the big leagues," said Matt Roberts,
executive director at the Energy Storage
Association. "There are no tax credits associated
with these projects and they are being justified on
their own merits."
While he declined comment on specific cost
implications of the project, Phil Grigsby, senior VP
for Commercial Transmission at Duke Energy, said the
utility went ahead with the project because it saw
"a commercial opportunity to monetize" its
operations in New Richmond.
"If these (energy storage) systems become more
developed and other applications that we don't even
foresee ... follow, then costs will continue to come
down and use of energy storage for reliability or
arbitrage may come to bear," Grigsby said.
When it was closed last year, the New Richmond
facility comprised a mix of coal- and oil-fired
power plants and generated 1.43-GW in power
capacity. But, Grigsby said, the plant had become
uneconomical. In the end, the utility opted to close
However, certain assets, such as a substation,
were reused in its new life. LG Chem supplied the
lithium-ion batteries used in the project and Parker
Hannifin provided a 2-MW conversion inverter.
San Francisco-based Greensmith Energy provided
its GEMS software platform, playing the pivotal role
of interconnecting different parts of the project.
According to John Jung, CEO of Greensmith, the GEMS
platform "orchestrates" the entire system of
systems, including batteries, inverters, HVAC and
sensors. "Maximizing an energy storage system's
frequency regulation score while minimizing battery
degradation throughout the system's life is no
trivial task," Jung said.
A growing market
How many more such projects might arise remains
to be seen, though the potential seems good.
According to a recent report by the Energy Storage
Association and Greentech Media, the U.S. deployed
60.3 MWH of energy storage in the third quarter of
2015. That figure is double the amount deployed last
year. In total, this year's deployment of energy
storage is on track to exceed 192 MW, representing a
three-fold increase from last year's figures. "The
growth curve for energy storage systems is beginning
to resemble a hockey stick progression," said
Roberts. He said the current set of projects
represented only "2% of what we'll see in the
A majority of these deployments have taken place
in the Northeastern PJM market. However,
utility-scale energy storage has also begun to
appear in proposal requests and grid planning in
other states, such as Georgia and Vermont.
In part, that's because regulators in recent
years have created new incentives that reward
utilities for finding ways to boost reliability
without having to spend more. At the same time,
battery prices have been falling.
Also, development of sophisticated software
platforms has dramatically reduced deployment time
and costs for such projects. "A dollar spent on
control software, such as GEMS, delivers more of a
boost in system performance, longevity and ROI than
a dollar spent on hardware, including batteries,"
Finally, utilities are learning from their own
past or others' experiences. For example, Duke
Energy opted for lithium-ion batteries (instead of
lead-acid batteries) at the New Richmond project
based on its experience with the latter at a past
That said, the quantity and volume of such
projects are still not substantial enough to make a
difference to the overall market.
"The battery industry needs to transition from
small pilots to larger and broader commercial
deployments," said Jung.
Grigsby said the potential for profits from such
projects depends on rates at different times of the
day. "The pricing is different during the day in
different markets and that makes a difference to the
number of hours that you can monetize," he said. "We
have not found a project (in other markets) that
makes sense yet."
Now that the project is done, Duke Energy will
operate a total of 4-MWs of energy storage at
Beckjord, where a separate 2-MW battery system
already exists. Duke Energy also owns and operates a
36-MW energy storage system at its Notrees Windpower
Project in Texas.
According to research firm IHS, Duke Energy owns
nearly 15 percent of the grid-connected,
battery-based energy storage capacity in the U.S.