Moving Toward Hybrid Power Systems Creating value with utility scale energy storage ERCOT Renewable Technology Working Group April 2009

2 Pioneers: Over a decade of energy storage projects have set the stage

3 What does it mean to be “hybrid”? Hybrid Lessons Better performance can be achieved through faster response and increased power capacity. More efficient use of combustion engine can be delivered through steady throttling. Ancillary functions of the vehicle, such as braking, can be delivered by using energy storage to recycle energy. Energy storage can be integrated into the electric grid to deliver a similar set of benefits. The result will be a Hybrid Power System.

4 Drivers: RPS goals creating a need for capacity and ancillary services.

5 Different Services Would Require Different Type of Storage Device Battery Options: –Li-ion: quick charge/discharge, more efficient –Flow (Zinc-Bromide): longer charge/discharge, smaller MW units, more expensive Potential Service Options: –Ancillary Services markets  Regulation  Responsive Reserve  VAR support  Black Start –Internal plant usage (auxiliary load, demand mitigation) –Transmission constraints (intermittent renewable sources) –Price arbitrage

6 Li-ion Energy Storage for Ancillary Services System Characteristics: Self-contained 2MW modules with 15 min of run-time Scalable by paralleling containers 90% round-trip efficiency Faster response than any existing plant units IEEE power quality standards 7-10 yr life Less than 12 months to deploy Portable

7 Flow Energy Storage for Ancillary Services and Constrained System Characteristics: Self-contained 0.5MW modules with ~5 hours of run-time Scalable by paralleling containers 70% round-trip efficiency Faster response than any existing plant units IEEE power quality standards 20 yr life Less than 12 months to deploy Portable

8 Near-term Value in U.S.: ISO Ancillary Services Markets Regulation is a near zero-energy service compensating for minute-to-minute fluctuations in total system load and uncontrolled generation.

9 Proof of Solution System: AES has built and interconnected a 2 MW grid-scale battery energy storage system using Lithium Ion batteries. This system was validated by KEMA Consulting for Ancillary Services applications. The scope included safety, performance, and application testing Operational 2 x 1MW system installed at IPL substation. Meets IEEE 519, 1547 Power factor of 0.96 Less than 1-sec response time to any dispatch level Over 90% round-trip efficient in regulation test

10 Four second dispatch area control error (ACE) signal on 1MW system (4 hr test) shows manageable thermals due to high system efficiency.

11 Advanced batteries provide “instant” response to +1MW to -1MW swing.

12 An AES commissioned dynamic simulation study of NYISO, PJM, and CAISO shows significant system benefits from energy storage systems with 15 min of storage capability. Conclusions: “…What is extremely interesting is that the effectiveness of the storage device increases if the AGC is adapted to take advantage of a fast-acting device that also needs to be "repaid" to restore its energy levels in a finite period of time. The improvement in ACE itself is not the major benefit but the ability to achieve regulation services using storage devices with lower energy-to-power ratios (shorter duration periods) may be very important. The reduced capital cost implied by the lower energy-to-power ratio translates into lower overall costs for regulation services from the storage device.” “Storage devices responding to the filtered ACE signal are more effective than conventional generation at providing AGC regulation, in terms of system ACE performance, when used as described in this paper. This strongly implies that a lesser MW amount of regulation procured from storage and utilized as the primary resource for responding to ACE can be used as compared with the volume of regulation procured today from conventional resources.” “Depending on the relative extent of storage used for regulation, the use of storage also results in decreased regulation signals to conventional units, which provides benefits in terms of incremental maintenance and possibly reduced adverse emissions effects.”

13 Commercial Project Example: Spinning Reserve Replacement in Chile 12MW for 20 minutes system comprised of 8 containers of Advanced Lithium-ion storage Increases energy sales from existing power plant by 4% by sell additional 12MW Received local system operator approval based on transient system study

14 Commercial Project Example: Spinning Reserve Replacement in Chile 50 Spinning Reserve events per year

15 Commercial Project Example: Spinning Reserve Replacement in Chile Improved frequency response versus power plant. Plant with 8MW Reserve and 12MW Storage Plant with 20MW Reserve Simulated loss of 332MW of generation.

16 Renewable Integration Opportunity: Wind Projects Problem:Curtailments due to transmission constraints are limiting delivery to customer under PPA Duty Profile:At least a 20MW system with 4-5 hrs of charge and discharge capability per day Technical Solution: Premium Power ZincFlow Flow Battery 40 x 2.8MWh 1000kW/500kW units

17

18 Internal architecture Comms BOX Ops Center Internet Relay DNP

19 Interconnection Scheme The project consists of a modular system, easily serviceable, and sectionalized into inverter sections supplying a common battery string. Grid protection meets utility requirements The system is connected to the operations center Grid Step-up Transformer Disconnect / Switchgear Isolation Transformers Inverters Batteries Internal Load

20 Inverters are “off-the-shelf” and proven. Trusted PCS Suppliers: Parker 1 MW Inverter System ABB American Superconductor Parker Hannifin S&C Siemens

21 System benefits from a storage enabled grid: “Better and Cheaper Today” – Increasing capability of existing generating units by delivering ancillary services from dedicated energy storage units. – Same cost for better quality service – “faster response to variations” – Better use of existing assets – “steady throttling of plants” “Enable the Future” – Faster response to support varying nature of new supply. – Lower emissions – “recycled energy”