Nov 24 2009

PG&E's Energy Storage Project Gets a Green Light

Posted by: Jonathan Marshall

Good news for California clean energy: the U.S. Department of Energy today awarded PG&E $25 million to fund initial work on a significant energy storage project to support the utility's increased use of renewable wind and solar power.

The grant to PG&E was one of 16 awards, totaling $185 million, to "help fund utility-scale energy storage projects that will enhance the reliability and efficiency of the grid, while reducing the need for new electricity plants," according to DOE.

"Improved energy storage technologies will allow for expanded integration of renewable energy resources like wind and photovoltaic systems," it added.

Energy storage is a critical part of next-generation utility "smart grids" that the Obama administration is strongly backing with R&D and infrastructure grants.

Storage will contribute to grid efficiency, reliability and sustainability by smoothing out the fluctuations in power output from wind and solar plants. It will also reduce the need to build costly new fossil-fueled generation by absorbing excess wind generation during periods of low demand and releasing that energy at times of peak demand.

By one estimate, California will need four gigawatts of storage to meet its goal of achieving 33 percent renewable power by 2020.

The funded projects include advanced battery systems, flywheels and--PG&E's current focus--compressed air energy storage (CAES). Experts at the Electric Power Research Institute in Palo Alto say that CAES is the most cost-effective form of mass energy storage.

PG&E's $356 million compressed air energy storage project in Kern County will use night-time energy, when wind power is most abundant, to pump air into a porous rock formation deep underground. The compressed air will then be released to drive turbine generators as needed. The project will be big enough to deliver 300 megawatts of power--about as much as a mid-sized power plants--for up to 10 hours.

PG&E hopes to win approval before the end of the year from the California Public Utilities Commission and California Energy Commission for additional funds to match the DOE grant. The total should be enough to cover site planning, technology selection and project design. The utility will then put the project up for bid, with the expectation of it going operational by the end of 2014.

Supporters of the project include the Independent Energy Producers Association (IEPA), a California trade association representing many renewable energy developers, and the manager of the state's electric grid, the California Independent System Operator (CAISO).

"Energy storage promises to be a game changer for integrating renewable energy into California's resource mix," said Jan Smutney-Jones, executive director of IEPA. "This project will commercially prove-out compressed air storage leading the way for future projects."

"Large-scale energy storage technologies with multiple hour charge and discharge capabilities, such as compressed air storage, offer the potential to significantly help manage high penetration levels of variable renewable resources," said CAISO's director of system operations, Debi Le Vine.

PG&E is also considering a major expansion of its pumped hydro storage capacity, but that is expected to be a 10-year process, said Hal La Flash, PG&E's director of emerging clean technologies. Meanwhile, "We have thousands of megawatts of renewables coming on line so we also need storage technologies like CAES that can go into operation sooner."

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