Stored Potential

October 10, 2017

By Scott Rackey & Dr. Raed Bkayrat, First Solar

The combination of solar photovoltaic (PV) with storage, or PVS, is no longer a pipe dream for utilities and developers seeking low-cost solar energy without the difficulty of designing around resource intermittency. Battery prices have dropped so much in recent years that integrators in mature markets are now able to offer PVS systems as a “wrapped” product. These systems provide a guaranteed availability around a specific dispatch profile, offering utility services that were historically only available from thermal generators.

undefinedHere in the Middle East there is already growing recognition of the potential for storage. The Dubai Electricity and Water Authority (DEWA), for example, is tendering a pumped-storage facility that will utilise photovoltaic solar to pump water into a reservoir in the Hatta Mountains, releasing it to generate electricity whenever needed. DEWA has also announced the results of a Concentrated Solar Power (CSP) tender with an eye on longer-term storage.

What has not made headlines, however, is the fact that the Water Authority of Jordan (WAJ) also issued a tender, earlier this year, for a PV power plant with an optional storage component. WAJ wants a 50-megawatt (MW) utility-scale PV power plant to offset its electricity consumption and factored in the possibility of having an additional 25MW of storage. Significantly, First Solar’s bid for a 75MWfacility with four hours of battery storage came in at under $100 per megawatt-hour.

This demonstrates that, in addition to superior flexibility, PVS can now provide a levelised cost of electricity (LCOE) advantage over newly-built fossil peaker plants in regions with good irradiance. Set against a considerable drop in the price of both PV systems and batteries, PVS has evolved well beyond mere load-shifting to encompass a full suite of services that complement existing fleet assets. Although large-scale deployment is still in the early stages, integrated PVS solutions are capable of providing benefits to developers and utilities similar, if not superior to, those provided by traditional gas peakers.

PVS offers a cost effective way to capture the benefits of the midday sun while avoiding the use of costly simple cycle gas peaking plants to provide ramp and evening capacity. Given the current price trajectory of PVS, policy makers and system planners need to anticipate the widespread adoption of this integrated technology as they consider and implement strategies to ensure system reliability.

Even without integrated storage, PV systems can already provide a suite of grid services including spinning reserves, frequency regulation, voltage support, ramp control and firming.  Solid-state PV systems can provide these services instantaneously, much more efficiently than conventional gas peaker plants, which take minutes to change output and must operate within a limited band of output power. In the absence of storage, these reliability services typically require curtailment of the PV plant to create the headroom for control.

When storage is integrated with a PV system, however, the facility can optimise existing PV system capabilities by capturing energy that would otherwise be lost to curtailment or clipping. Moreover, PVS offers the additional benefits of energy shifting, black start, and energy arbitrage, providing improved resource adequacy while deferring requisite utility upgrades. Driven by the combination of aging thermal plants, expensive peakers and increased renewables penetration, PVS is now fully capable of providing an economically flexible alternative to address utility Integrated Resource Planning requirements and broader system reliability concerns.

Ultimately, optimal deployment of PVS will depend on a utility’s specific fleet composition and growth needs. From a markets perspective, the rate of PVS adoption will be a strong function of how dispatchable PV is compensated for energy, capacity, and ancillary services. Competing on an all-source basis to complement existing fleet capacity is in everyone’s best interest. It is essential for all stakeholders to more fully understand the implications of PVS for portfolio and system planning.

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