The industry already recognizes the need to upgrade the grid; energy storage just happens to be the common thread to all upgrade plans.
Large Scale Energy Storage
Craig Wilkins | ViZn Energy Systems
Utilities seem to be having serious revenue issues all over the world, what are some of the biggest trends you are seeing?
We are seeing a trend of moving away from central generation towards a more distributed model aimed at localized generation for local consumption. Hurricane Sandy and Fukishima really accelerated this trend by exposing the weaknesses inherent to our traditional generation model. While the trend was initiated to solve reliability and redundancy issues, the ongoing cost reductions of renewable generation have helped move this along.
Additionally, there are several markets where these regional micro-grids are already being aggressively pursued. Areas with high penetration of renewables such as Germany and Hawaii are looking to deploy regional micro-grids to manage that energy for their own use and reduce the interaction with the utility and transmission carriers. While people are speculating on the death spiral of utilities, I believe utilities are seeing this trend and beginning to establish strategies around this emerging distributed model.
The key to distributed models is energy storage, so this trend is now putting a spotlight on next-generation batteries.
How could large-scale energy storage potentially solve some of the current grid issues?
It’s going to play a significant role in solving the problems presented our outdated and inefficient grid infrastructure. The industry already recognizes the need to upgrade the grid; energy storage just happens to be the common thread to all upgrade plans. Since it de-couples power generation and consumption, energy provides a more efficient delivery system. This means we can improve utilization rates and the efficiency of the existing infrastructure while supporting the integration of increased renewable generation. The smart grid is also going to need reliability, redundancy and flexibility – all of which energy storage provides.
What are the key elements to making energy storage cost effective?
Everyone agrees that there is value in energy storage, but most struggle to figure out how the battery will make money in today’s market. While most people focus on the cost of energy storage, the real key is balancing that cost against the value of services the battery provides. In order to make money, a battery needs to be able to support high-valued power services while maintaining an adequate level of capacity to provide those services over an extended period of time. So the bare minimum for a successful battery is something that can cycle multiple times per day under rigorous duty cycles.
Most batteries have not been designed to meet these punishing requirements. They won’t be financially viable. On the other hand, we designed our battery around the demands of micro-grids, so that it can provide unparalleled performance, safety and reliability in these high-use applications. A battery only makes money if it is being put through the paces. ViZn’s battery will be the workhorse for micro-grids and other utility applications.
How can energy storage companies like ViZn make the most out of recent incentives in California and solar grid problems in Hawaii?
Incentives provide the platform for accelerating our deployments, but a company cannot build a business on government subsidies and grants. Eventually the battery will have to be financially viable in the market without these incentives. We are currently bidding on several projects in California, Hawaii and Germany which are providing significant incentives, but our focus will continue to be driving down costs and supporting high-valued services so the battery economics stand on their own.
Several companies have attempted to provide large-scale storage batteries, why have they not been successful? Why do you think ViZn will be able to provide a successful solution?
Incumbent technologies are great for consumer electronics, electric vehicles and backup power. The grid is a wholly different operating environment and requires batteries to be electrochemically and mechanically scalable, safe and cost effective. Current technologies such as lithium and lead acid fail to adequately meet these 3 requirements. Therefore the industry is turning to innovative solutions such as flow batteries, which are more suitable to grid-scale applications. The conservative nature of the utility industry also hinders the deployment of promising, but unproven technologies. ViZn’s technology has undergone 8 years of DOE-funded research so the experiment phase is behind us. We have developed a commercial-grade product over 4 years instituting a combination of engineering and economics to provide a solution that hits the mark on performance, cost and safety.
Can you outline a typical ViZn installation and talk about the process, timing, major players and their roles?
Storage integration at a micro-grid is typically comprised of an ecosystem that includes distribution, controls, generation and of course, storage. While the incorporation of renewable generation at micro-grids is becoming more pervasive, the addition of storage is relatively new. As are some of the benefits like a reduced cost in energy, a reduction in backup generation needs, the unique ability to level the distribution and load variations common to renewable integration. This independence of generation from demand is a new and enabling part of a modern micro-grid. And storage is the mechanism that makes it all happen.
The infrastructure of an intelligent energy storage system includes several key components:
1) The Battery: ViZn’s unique approach to storage is to invest in technology that can use the entire state of charge without creating a hazard through toxicity or fire risk. Most flow battery technology fits these criteria nicely, with the exception that most flow batteries also use expensive metals and acids as the storage medium. ViZn forged a new path by using common elements like Zinc and Iron to reduce cost, and eliminate the acidic environment. This changed ViZn’s battery environment to a potassium hydroxide medium which is both more environmentally friendly and cost effective. The question was could this technology be realized in a skeptical industry that is used to metals such as lead, bromine, vanadium and lithium? Our recent Electrical Energy Storage Award win at Intersolar Europe, and our units already out in the field, suggest that it can.
2) Software and Inverters: To make the battery storage system work, you need software that can control and anticipate demand fluctuations, the battery state, and changes to the upstream and downstream requirements. ViZn is pleased to work with several companies that integrate the logic required for a renewable integration with the demand signals. With their software, it becomes easy to seamlessly integrate the battery subsystems. In addition to the controls, the inverter that is typically deployed for a wind or solar microgrid needs to be upgraded to achieve bi-directional distribution and storage. The unique nature of a flow battery’s large-format cell design typically requires an input/output of lower voltages than is usually produced on a grid. Integrating a properly sized bi-directional inverter is ultimately the key to fully utilizing the battery’s capabilities.
3) Technical Integration: While ViZn provides the storage engineering expertise, a successful integration project will also require developers with the appropriate PPA’s to coordinate their vision with competent EPC’s with construction and engineering expertise.
Properly integrated, a typical microgrid with a demand of 28,000 kWh/day from wind and diesel generation can cost over $51M to deploy and typically generates 9,585,260 kWh/yr of excess energy that is curtailed due to lack of demand at the time of generation. Overhead can then add up to $26M in O&M and fuel costs if microgrids up their safety infrastructure.
However, adding a 2MW/6MWh battery can reduce the over generation needed for contingencies, while also better utilizing renewable energy on hand. This reduces the microgrid’s over generation to 2,100,000 kWh/yr. This alone can save 25% of the costs experienced by a non-storage microgrid installation. The result is an energy ecosystem that is more dependable, more stable, and more affordable. It’s safer too.
What safety challenges loom largest in the next 10 years, and how can ViZn’s batteries help microgrids solve them?
Most of the safety concerns over batteries either involve the toxicity of the chemistry or the inability of the technology to control the heat generated during operation. Thermal runaway events (fires) have been seen with lithium, lead acid and sodium sulfur batteries. When you are dealing with a battery the size of a Walmart, you need to put safety first. ViZn’s battery utilizes food grade materials in our electrolyte solution and poses no environmental or fire hazards. We have also designed a superior thermal management system which dissipates heat away from the battery stacks. This allows the battery to support heavy-duty cycles without the concern of thermal runaway.
What does the microgrid market need to become, from an energy storage perspective, before the general populace starts feeling the positive effects?
To be generally accepted and widely deployed, micro-grids will have to provide energy at the same cost and the same level of reliability we have today. Five years ago, most would have never believed this would happen. With the reduced cost of renewables, inverters and the advent of reliable storage, this will become a reality much sooner than most suspected. We intend to be a significant part of that equation.
We noticed ViZn is mainly targeting the US and European markets, when do you see ViZn expanding its presence world-wide?
ViZn is currently working on projects in every part of the world. Developing areas such as Africa, South America and the Middle East are all perfect targets due to the need to build infrastructure from the ground up. Developed countries such as Europe, Japan, and the United States need storage to upgrade existing infrastructure. ViZn is committed to serving all regions.
Craig has 25 years of proven sales and executive management experience with a variety of start-ups in the financial and technology sectors. Mr. Wilkins is currently the President of ViZn Energy, a privately held storage technology company. Previously, Craig was the founder and President/CEO of Acceptance Capital Mortgage Corporation (ACMC), a nationwide mortgage broker with 100 offices in 30 states. In 1996, Craig was a founder and principal owner in NetWireless, the largest distributor for Nextel Communications, which grew to $40M in revenue in less than 3 years before being sold. When NetWireless sold to Bearcom, Craig managed the combined corporate account teams for the company. Prior to his work at NetWireless, Craig was the Director of Sales for CSI Financial, the second largest purchaser of hospital receivables in the United States. Craig has a BA in Finance from University of Montana and completed his graduate studies in Economics.
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