According to an upcoming paper by Sandia National Laboratories, which along
with the Clean Energy
Group/Clean Energy States
Alliance (CEG/CESA), provided technical assistance to
the Sterling energy storage
project, the biggest energy
cost savings potential from
the batteries comes from
reducing Sterling’s electricity demand during a single
annual peak demand hour
for the New England region.
This regional peak demand
hour generally occurs in July
or August, and each utility in
New England is assessed an
annual fee for capacity services based on its individual demand during that one
hour; and as utilities in the
region are painfully aware,
the cost of capacity has risen
precipitously, and is expected
to continue rising.
Green Mountain Power
(GMP), using a similar battery
and solar microgrid in Rutland, Vermont, demonstrated
the value of capacity charge
savings during the 2016
regional peak, on August 12.
In one hour that day, GMP
saved $200,000 in capacity
fees by discharging its bat-
teries (supplemented with PV
generation) to offset electrici-
ty purchases. Sterling Munic-
ipal Light Department will
attempt to do the same in 2017 and each year thereafter. This
will beneft the town’s ratepayers, but it also benefts the entire
New England region by reducing regional peak demand during
the hottest days of summer.
A second source of signifcant cost savings for SMLD can be
achieved by using the batteries to reduce utility transmission
charges. These charges are assessed based on a single peak
demand hour each month. As with the annual peak, if a utility reduces its demand during the monthly regional peak, it
reduces its share of transmission costs for the entire month.
In December 2016, SMLD successfully discharged its batteries
during the monthly peak, saving its ratepayers $17,000 for one
hour. That’s a signifcant savings for a municipal utility with an
annual budget of 8. 2 million. SMLD repeated this performance
in February and March and, with the batteries now fully operational, SMLD hopes to continue to hit monthly peaks on a regular basis. Hitting peaks in 10 months out of 12 would mean
transmission cost savings of $170,000 annually.
In addition, SMLD will use its batteries to engage in arbitrage—
that is, charging the batteries from solar or from the grid
Sterling’s battery storage unit can provide up to 12 days of emergency
backup power to the Sterling police station and dispatch center, a
community facility providing first responder services. Credit: Maria Blais
Costello/Clean Energy Group.