In-Home Storage: The Virtual Power Plant

Rapid Growth

Solar and wind are considered the most popular renewable resources across the world, but due to their intermittent and unpredictable nature, utilities are still relying on natural gas and coal. However, when renewable technologies are combined with energy storage they smooth out load fluctuations and have the potential to significantly impact the generation mix.
Total energy storage deployment has increased dramatically in the past few years because of low-carbon, clean energy policies, and is anticipated to grow even more in the near-term. By 2022, GTM Research expects the U.S. energy storage market to reach 2.5 GW annually, with residential opportunities contributing around 800 MW.


Source: GTM Research

How Does It Work?

Energy storage works as a three-step process that consists of extracting power from the grid, solar panels, or wind turbines, storing it (charging phase) during the off-peak period when power prices are lower, and returning it (discharging period) at a later stage during the on-peak period when the prices are much higher.


For electric vehicles (EV), most of the charging happens at night and during weekends, when the prices are comparatively lower, and vehicles are not used that much. As EVs continue to enter the mainstream market, they would increase the off-peak prices and contribute to load shifting.
Energy storage devices and EVs can complement each other or they may be competitive. But energy storage is the key element for EV charging during on-peak hours.

Different Market Players

Residential energy storage has been a holy grail for companies like Tesla, Panasonic, LG, Sunverge Energy, and Orison with lithium ion (Li-ion) batteries as the leading technology type. Now with plug-in electric and hybrid vehicles on the rise, automobile companies Tesla, Nissan, Mercedes Benz, BMW, Renault and Audi have also joined the residential market to integrate EV charging stations, battery storage and rooftop solar that in essence has a residence operating as a virtual power plant.
Beginning in December of last year, Arizona Public Service Company deployed Sunverge Energy’s energy storage hardware coupled with advanced, intelligent energy management systems that predict future load requirements and solar generation. Additionally, Tesla is enjoying significant market share, shown recently by Vermont-based Green Mountain Power’s launch of a comprehensive solution to reduce customer electricity bills using Tesla’s cutting edge Powerwall 2 and GridLogic software.
A few other utility companies, especially in Florida and California, are also exploring residential energy storage programs, as shown in the figure below.


Source: Hawaii PUC; General Assembly of Maryland

So, what are some other current thoughts about the pros and cons of in-home energy storage?

  • Energy storage reduces load fluctuations by providing localized ramping services for PV and ensuring constant, combined output (PV plus storage).
  • Improves demand response and reduces the peak demand.
  • Extra savings for customers through net metering systems and end-user bill management.
  • Reduces reliance on the grid; the customer can generate and store the energy during severe outages also.
  • Disposal of Li-ion batteries is not easy, and they are difficult to recycle
  • Automakers, like Nissan and BMW, are implementing second-life batteries, thereby reducing the durability and reliability of the product.


Concluding Thoughts

Clearly, a wider acceptance of energy storage resources would be a game changer in the U.S. power sector. Utilities, consumers, and automakers are profiting from this exponential growth of energy storage. With an increasing number of companies using artificial intelligence and machine learning algorithms for energy management systems, the synergy with energy storage creates a perfect, smart, personal power plant which has tremendous potential to change the landscape of the energy industry.

Filed under: Clean Power Plan, Hydro Power, Power Grid, Power Market Insights, Power Storage, Renewable Portfolio Standards, Renewable Power, Solar Power, UncategorizedTagged with: , , , , , , , , , , , , , , , , ,

Nuclear Retirements – The Unknown Future of Nuclear Power in the United States

Nuclear Plants Nearing Retirement

The U.S. currently has over 2 GW of nuclear capacity scheduled to be retired within the next four years.  The three planned closures are the 678 MW Pilgrim Nuclear Power Station, the 610 MW Oyster Creek Generating Station, and the 852 MW James A. Fitzpatrick Power Station.  The operators of these plants determined that while they had received extensions to their initial licenses, remaining operational was not economically viable.


Figure 1: U.S. Nuclear Capacity Source

As of August 2016, announced retirements looking even further into the future total above 7 GW with a few others being politically tenuous it further compounds the uncertainty within the nuclear fleet. Included in this 7 GW is the Fort Calhoun plant in Nebraska that was shut down by Omaha Public Power this year on October 24. However, this is just the tip of the iceberg when you consider the remaining plants and their need for future license extensions.

The Arduous Licensing Process

Nuclear plants are initially licensed for up to forty years by the U.S. Nuclear Regulatory Commission (NRC).  The operator may then apply for an additional twenty-year renewal; following that they can apply for a further extension of twenty more years.  All extensions are initiated by the operator and must be started sufficiently ahead of the expiration of their current license for the NRC to evaluate the safety and environmental impacts of an extension.  When operators apply more than five years prior to expiration, they can usually continue to operate while under this review.  If they don’t apply until within five years of the expiration, they may be forced to stop operating until they are approved.  The renewal process contains multiple cumbersome steps as shown in the diagram below.


Figure 2: License Renewal Process Source


Current Operating Nuclear Plants

The U.S. has 100 operating nuclear power plants; 45, or nearly half, have already operated through their forty-year operating license and are on their initial twenty-year extension.  Two of these are approaching the need to apply for their second extension: Peach Bottom in Pennsylvania and Surry in Virginia.


Figure 3: Active Nuclear Reactors  Source

To look at it another way, 81 plants have received their first renewal, an aging fleet in its own right.   But this means up to 30 GW of nuclear power has an unknown fate based on a not-yet-granted second license extension alone.  To date, no renewal applications have been permanently rejected but several plants have needed to make extensive improvements to gain approval.


Figure 4: Licensed Nuclear Plants Source

According to a recent Moody’s report, today’s low gas environment is making it difficult for some smaller nuclear units to survive competitively in the power market.  The future of gas will likely play a key role in the future of nuclear viability, as even without costly improvements some nuclear generators are struggling to stay afloat.

Nuclear Plants Coming Online

Interestingly, there are still a number of newly constructed plants currently in the process of becoming licensed that will bring over 5,000 MW online by 2020; these include plants in Tennessee, North Carolina and Georgia.  Additionally, there are up to six more applications for a combined 10 new reactors currently under review by the NRC.  A few companies are also looking into new designs that are smaller in scale, under 500 MW as opposed to +1,000 MW, that are more modular in design.  This new technology would give them the flexibility to be placed on more urban sites as needed to accommodate grid needs.

The Future Role of Nuclear Power

While a few sites are in the process of retiring their reactors, nuclear power is likely to be a part of the energy solution going forward for some time.  The minutiae of the policies may change, but one thing is certain: nuclear power will play a significant role in meeting U.S. electricity needs while curbing carbon pollution.  The U.S. Department of Energy reports the level of nuclear power generation for the country has been at 20 percent, the question is what hurdles will nuclear owners and operators have to overcome to maintain that level?

Filed under: Clean Power Plan, Nuclear Power, Renewable Portfolio StandardsTagged with: , , , ,

Using AURORAxmp to Meet Renewable Portfolio Standards (RPS)

According to the National Renewable Energy Laboratory (NREL), a renewable portfolio standard (RPS) is a “regulatory mandate to increase production of energy from renewable sources such as wind, solar, biomass and other alternatives to fossil and nuclear electric generation.” In 1983, Iowa became the first US state to adopt a renewable portfolio standard. In the last two decades, over half of the states in the country have adopted some form of RPS. Below is a chart displaying renewable capacity additions by state between 2000 and 2015:


Source: Lawrence Berkeley National Laboratory

Though RPS can be enforced in several ways, the mandates typically require utilities to provide some level of electric supply with renewable energy. The federal government, and sometimes state & local governments, provides financial incentives, often in the form of tax credits or rebates, to encourage investment in renewable energy. According to the Lawrence Berkeley National Laboratory, 60% of renewable electricity generation and 57% of renewable capacity builds since 2000 are tied to RPS mandates. The ultimate goal of these policies is to migrate away from fossil fuel generation in an attempt to reduce carbon and other various emissions.

AURORAxmp provides the flexibility to model various state RPS mandates and can be used to measure the impact of RPS standards on system cost, zonal prices, and emission reductions. The built-in constraint logic is used to easily specify the minimum amount of electric generation needed to meet any specified fleet of resources. Multiple parameters apply the constraint geographically as well; for example, RPS constraints can be applied on a local, state, and national level, and the model will solve all of them in the same run.

RPS constraints can also be defined in the form of renewable capacity rather than electric generation. For example, the Clean Power Plan (CPP), proposed by the EPA last year, contains several intricate details that specify how conventional fuel generators will be required to operate, both individually and as a group. Any capacity or generation constraints can be used in conjunction with a variety of other defined limits, such as emission rates, restrictions on fuel usage, and limitations on capacity factors. Additionally, these constraints are fluidly incorporated into various types of studies, such as long-term capacity expansion, risk, and scenario analysis. Below is a chart created using AURORAxmp to estimate the total system cost of different programs:


Generation attributed to RPS is expected to double by 2030 in the United States. As we look into the future, it is evident that the integration of renewable energy will continue to be a major point of interest in power markets. AURORAxmp offers an easy, reliable, and robust tool to analyze the impact of additional renewable generation on resources, the environment, and the electric grid.

Filed under: Renewable Portfolio StandardsTagged with: , , ,