Sandia is a multi-program laboratory operated by Sandia Corporation, a Lockheed Martin Company, for the United States Department of Energy’s National Nuclear Security Administration under contract DE-AC04-94AL SAND P Hawaii Energy Storage Seminar: American Electric Power Energy Storage Capital Deferral and Reliability John D. Boyes Sandia National Laboratories Energy Storage and Distributed Resources June 16, 2010

American Electric Power (AEP) Installed 4 Distributed Energy Storage Systems (DESS) Defer substation upgrades of overloaded substations Improve reliability through dynamic islanding Plans for integrating renewables

Benefits of Distributed Energy Storage Systems (DESS) Among the benefits that AEP believes will be realized from this effort presently and the future includes: Deferral of capital expenditures Increased electric service reliability by providing backup power. Increased penetration of renewable sources of energy. Ability to meet increased growth rate of customer load demand. Ability to deliver better power quality in the information technology age. Reduce stress on an aged electric grid The success of the Charleston WV project lead AEP to deploy more Energy Storage

Improving Reliability Energy storage could allow “islanding” in the event of a grid fault Energy storage system could provide VARS Procedures for islanding with energy storage needed to be developed Software and control systems needed to be developed

Adaptive Dynamic Islanding Select customer loads to be served by island Large number is individual disconnects Advanced Metering Infrastructure Utility must set priorities (hospitals, police and fire) Develop ways to fairly implement new tariffs and selection process Currently not cost effective Station Energized (on island) Disconnected (off island)

Discrete Dynamic Islanding Island predefined sections of the grid Dependent on Fault location Load SOC of storage Communication and control of intelligent switches or reclosers Remotely activated or automatic Station Zone 2 Zone 1

DYNAMIC ISLANDING SCHEME AdaptiveDiscrete Disconnect DevicesRemote Meter DisconnectsReclosers & Switches Site-Specific DesignMinimalExtensive Phase BalancingEasyLimited Capacity MatchContinuousDiscrete OperationControlled restoration (no cold start) under all circumstances. Optimizing ReliabilityEasierChallenging Cost (disconnect devices)Cost offset by remote meter reading & other distribution automation benefits Additional costs for balancing and more isolation points Comparison of Discrete and Adaptive Dynamic Islanding

2MW, 14.4 MWh NAS Battery Installation in Citizens Station, Ohio The station was chosen to defer capital that will be needed to build a new substation and support a weak transmission system. There are 261 customers who are in the portion of the circuit The addition of the battery will produce a domino effect helping other stations during overload conditions as well as increasing the throughput of these stations. Citizens Station, Ohio

2MW, 14.4 MWh NAS BATTERY Installation in E. Busco Station, Indiana Primarily chosen to defer capital that will be needed to build a new substation. Use of islanding to improve the reliability of the electrical circuit. There are 548 customers within the section that can be on the island. E. Busco Station, Indiana

BALLS GAP STATION (WEST VIRGINIA) Defer capital that would have been needed to build a new substation. Use of islanding to improve the reliability of the electrical circuit. There are approximately 700 customers on the section of the grid 2MW, 14.4 MWh NAS Battery Installation in Balls Gap Station, West Virginia

References Installation of the First Distributed Energy Storage (DESS) at American Electric Power (AEP), Ali Nourai, SAND First Application of Large Scale Batteries for Multi-Hour Backup Power of Distribution Circuits at American Electric Power (AEP), Ali Nourai, Chukwuemeka Oka, SAND2010-xxxx, in review, will be published at: Technical Reports (SNL)