Feeder Advanced Storage Transaction (FAST) Battery Storage for a Smarter Grid

1. Feeder Advanced Storage Transaction (FAST)Battery Storage for a Smarter Grid • Presented to our client, PGE • The EverReadys: • Naresh Bokka, Michael Broda, RK Karduri, Cynthia Kan, Ken Nichols, Anil Palliboina, Victor Shestakov • Tuesday, June 15, 2010

2. Feeder Advanced Storage Transaction (FAST): What is it? Inverter Oxford Substation in Salem 1,300 kWh Battery 5,000 kW Ever Ready

3. Why Battery Storage? • Issues with current “not smart” grid: • Electricity cannot be stored, it is created & consumed at the same time • Battery storage can provide power during peak demand • Transient nature means a short term bridge is needed to allow time for backup generators to kick in Source: Esource

4. Why Battery Storage? • Issues with current “not smart” grid: • Renewables: may not be available during peak periods (or may be available during off peak)

5. Goals of the FAST project • Part of the PNW Smartgrid Demonstration Project, funded by ARRA as a research project for PGE to explore how storage capacity will provide local and grid-wide benefits ($20 million for PGE) • Anchor a high reliability island or microgrid • Provide power during peak demand • Firming intermittent renewable resources

6. FAST Environment 5 MW • 5 MW of customer backup generators (diesel) DSG • 113 kW Solar PV at Kettle Chips plant • Implement 1,300 kWh battery (EnerDel), a 5 MW PCS (Eaton) as part of “Islanding” • Demand Response programs Residential Demand Response

7. FAST and the Smart Grid • Intentional Islanding an SG technical feat. • Monitor and Control. Existing GenOnsys – ethernet radio and modbus. • Current human control signals >>price based signals • GenOnsys expand to manage more DER http://mendocoastcurrent.files.wordpress.com/2009/07/smartgrid-graphic.jpg

8. Energy Storage Reference: Energy Storage and the Smart Grid TiE Oregon Clean Energy Special Interest Group100421

9. Battery Technology: Lifetime behavior Frequency regulation and Voltage support Energy, Power, Power Quality Reference:Altairnano Lithium Titanate Cycle Life versus depth of discharge

10. FAST Benefits

11. Peak Discharge/Off Peak Charge CHARGE CHARGE DISCHARGE Source: Esource

12. Savings ValuationPeak Power at Off Peak Prices • Assumptions: • Battery discharges 1 MW during peak, charges 1 MW off peak • Volume negligible (no price elasticity effect) • Data from Dow Jones Mid Columbia Price Index • June 2005 – May 2010 time period (5 yrs) • Average price differential is $9.80/MW • Savings is $17,802

13. Battery Economics – Peak Shaving

14. Battery Battle:Utility ScalevsElectric Vehicles

15. Policy Analysis PNW ISO Managing renewable generation Price signals (shorter blocks, shorter duration) CA AB 2514. 5% storage rate by 2020, or 3,400 MW in CA. “Ratepayers pay for manufacturing jobs” NO Price Caps. CAISO current cap is $1,000/MWh energy. “you can cut my power for $1,000/MWh” SG Industry to Federal Leadership: “thanks for the $3.4 Billion, all we really needed was a CO2 tax” Utilities/PUC challenged to forecast in volatile policy environment FERC to consider allowing distributed resources to sell power.

16. Policy Analysis Interests Coincide Project Transparency Economic Development (Jobs) Social Responsibility Sustainability Renewable Energy Integration Reliability Business Case

17. Sustainability • FAST project – a perfect example of sustainable development Chart 1. Balancing three “pillars” of sustainability • Improved quality of life • United Nation’s World Summit 2005 • Jobs created • “Green collars” • Energy security • Renewable energy integration • Renewable energy infrastructure growth • Reduced GHG emissions • Jobs created • Energy independence • Fossil fuels energy facility • construction avoided • Green economy growth “Sustainable development requires the reconciliation of environmental, social and economic demands - the “three pillars” of sustainability.”United Nation’s World Summit 2005

18. PGE SG Challenges & Opportunities • Technical challenge of intentional islanding • Transparent pricing for power and ancillary services >>Ratecase risk • Develop smart tools such as market and forward pricing • Expand GenOnsys to incorporate new distributed resources • Demand Response via 3rd parties, with smart meter analytics • Look for SG opportunities when considering T&D investment • Support EV cars through pricing program, ratepayers should not pay for capital

19. Acknowledgements to our Technical Advisors at PGE • Mark Osborn, Manager Distributed Resources • Conrad Eustis, Director Retail Technology

20. Discussion Questions • Do think public policy should support use of the city right-of-way for the distribution system battery storage? E.g. a battery-inverter storage system that is 8 feet long, 4 feet deep, and five feet high ever half-mile. • Market interest in Power reliability: • For a commercial or industrial high reliability zone? E.g. a square mile where a high reliability micro grid is created for the property owners/tenants. How should the incremental cost be recovered? • For residential customers an optional home back-up system? The system backs up the home in the event of a grid outage. The utility owns and maintains the systems and uses it to support renewables integration. The customer would pay about $10 a month for the back-up service. • The lack of a transparent and liquid market for power services in the Pacific Northwest makes the introduction of certain resources very difficult. Do you think the region should create (as most US regions already have) an independent system operator that manages a transparent market mechanism? What entities should drive the creation process? • What key issues have we missed on our analysis?