By Dave Williams – Atlanta Business Chronicle
Georgia Power Co., which prides itself on a diverse portfolio of energy generation sources, is about to add another.
The latest 20-year energy production plan the Atlanta-based utility has submitted to the state Public Service Commission (PSC) calls for the addition of 50 megawatts of power generated through battery storage.
“This is an emerging technology,” said Liz Coyle, executive director of Georgia Watch, a statewide consumer advocacy group based in Atlanta. “I think it’s important to do it well.”
Battery storage is the new wrinkle in an otherwise familiar array of energy generation sources Georgia Power is proposing in its 2019 Integrated Resource Plan (IRP), which the utility files every three years outlining the mix of power sources it will rely on to generate electricity for the next two decades.
The PSC began hearings on the IRP last month and is scheduled to vote on the plan in July.
The 2019 IRP keeps Georgia Power moving away from coal as its dominant source of electrical generation toward greater reliance on natural gas and, to a far lesser extent, renewable energy.
As recently as 2005, 52% of the company’s energy mix was being produced by coal plants, with only 27% coming from gas. Under the 2019 IRP, Georgia Power’s reliance on coal is down to 25%, while gas carries the largest load at 45%.
Renewable power makes up only 3% of the Georgia Power pie chart, not nearly enough according to the environmental, consumer and solar industry groups that have filed testimony with the PSC as intervenors in the IRP review.
“It’s great that they’re proposing to develop another 1,000 megawatts of solar,” said Bobby Baker, a lawyer representing the Southern Alliance for Clean Energy and a former PSC member. “But there’s a lot more potential out there. … Renewables are dominating development of new electrical generation sources.”
While Georgia Power’s initial foray into battery storage will be limited, other utilities in other states are going all in on the new technology. California is the U.S. leader, with 4,200 megawatts in energy storage from 220 operational projects, according to the Center for Sustainable Systems at the University of Michigan.
Florida Power & Light Co. (FPL) announced a plan in March to build the world’s largest solar-powered battery system in Manatee County, south of Tampa, which will replace two aging natural gas plants. At 409 megawatts, it will be four times the capacity of the largest battery system in operation when it begins serving customers in late 2021.
“This is a monumental milestone in realizing the full benefits of solar power,” said Eric Silagy, FPL’s president and CEO. “Even as we aggressively execute on our plan to install 30 million solar panels by 2030, we never lose sight of finding innovative ways to bring our customers the benefits of solar energy.”
Indeed, combining solar projects with battery storage appears to hold the greatest potential in adapting storage technology to power generation.
Baker said adding energy storage capability to solar projects eliminates the greatest drawback that has plagued solar technology: the intermittent nature of solar power.
“It can give 24-7 capability solar doesn’t have at this time,” he said. “In 10 years, every solar project will have a storage component.”
“The addition of energy storage to a solar project would make the solar output much more predictable and less variable,” Arne Olson, senior partner at San Francisco-based Energy and Environmental Economics Inc., wrote in testimony filed with the PSC on behalf of the Georgia Large Scale Solar Association.
The current economic climate favors moving forward with battery storage sooner rather than later, Olson wrote. The cost of energy storage technology has been declining for several years and is projected to continue falling.
However, a federal tax credit now available to help utilities finance storage projects is being phased out during the next three years from the current 30%.
Brad Carver, a partner in the Atlanta office of Hall Booth Smith, P.C. representing the Georgia Large Scale Solar Association, said the tax credit won’t be there in 2022 when Georgia Power next updates its IRP.
“There’s a federal opportunity there that, if we don’t take it, other states will,” he said.
Carver said the same sense of urgency holds true for solar projects, which also are eligible for the tax credit. That’s why the group he’s representing is asking the PSC to require Georgia Power to add 3,500 megawatts of solar power to its portfolio rather than the 1,000 megawatts the utility is proposing.
Other intervenors are seeking an additional commitment to solar energy from the commission ranging from 3,000 megawatts to as high as 4,800.
After crunching the numbers, the Georgia Large Scale Solar Association concluded Georgia Power could add the 3,500 megawatts of solar energy the group is requesting and still stay below what the utility would have to spend to generate comparable capacity from other sources.
Olson noted the cost of large-scale solar projects has fallen 88 percent during the last decade.
“Large-scale solar power plants provide identical value as coal power to the Georgia Power portfolio in terms of exposure to variable natural gas prices,” he wrote.
Although the intervenors are calling for Georgia Power to take a more aggressive approach toward battery storage technology than the 50 megawatts the company proposes, they support the utility’s initial plunge as an important step toward stepping up its commitment in the 2022 IRP.
“We want them to get some experience with it,” Carver said. “That will help them evaluate it down the road.”
Copyright © 2019 Atlanta Business Chronicle
Source: Atlanta Business Chronicle