October 21, 2011

Alberta’s wind power producers face energy storage challenge

By Dave Cooper, Edmonton Journal, www.vancouversun.com 20 October 2011

Alberta’s wind power producers hope to more than double their output over the next few years, but a new economic and technical report suggests there are major challenges ahead.

The key to making green energy profitable is the ability to store the energy – most likely by using excess electricity to run large air compressors that fill underground caverns with pressurized air. The pressure would then be released on demand to turn a turbine that produces electricity.

Provincial wholesale power prices fluctuate every 10 minutes. The new study, released this week, examined generation from several wind farms and power prices during that period.

It found wind farms could have increased their revenue by up to 43 per cent if they had been able to store power and add it to the market as demand – and prices – increased. When prices were lower, they could recharge their storage.

“This study is the first public one on energy storage, but we need it to start the debate here,” said Andy Reynolds, program leader for clean energy at Alberta Innovates Technology Futures.

His group obtained support from Enbridge, Enmax, Shell, Capital Power and the Alberta Electrical System Operator, along with the energy and environmental solution arm of Alberta Innovates. Those groups, together with wind generators and others, will meet in Calgary on Friday to discuss the report and suggest a next step.

Reynolds says other countries have some experience with power storage – the U.S. had the first salt cavern storage system in Alabama 20 years ago with a site that can store 100 megawatts of power, and provide it to the power grid over 26 hours.

Other planned projects are much larger – up to 1,000 MW of storage at one site. This will be a boon to green power, which needs the wind to blow and the sun to shine.

Alberta has salt caverns that are used to store natural gas, and plenty of potential sites for more. The province also has plenty of wind.

But its open market for electricity means the lowest-cost power from coal always gets used first. Without power purchase agreements, or PPAs, or the ability to guarantee that the wind will blow when the demand rises, wind power producers generally get the lowest prices when their output is added to the grid.

(The old PPAs for coal plants are being phased out.)

This makes stand-alone, unsubsidized wind projects uneconomic. (The newest project, owned by Capital Power, is being built because it gets a subsidy through a PPA with a California utility under that state’s green credit program, even though the power will be sold into the Alberta grid.)

But energy storage could change the game. “In Canada you are mostly likely to see these power storage projects in provinces which will sign a PPA and guarantee a certain price for the power,” said Reynolds.

But since Alberta’s marketplace differs from others, the province’s small independent power producers asked for help in determining how they might become “dispatchable” – or have the ability to send power into the grid as required.

Reynolds says the 10-month project has succeeded in building relationships, and while there are many more questions to be answered, the “kernel of the capacity to answer them” now exists.

Work is needed on energy storage in communities and industrial parks, and as a way to relieve congestion at “inter-tie” locations, where wires from B.C., Saskatchewan and Montana enter the province.

The province is committed to reducing greenhouse gas emissions by 37 megatonnes annually by 2050, and wind and solar energy will play a big role. But the storage issue must be resolved, said Reynolds.

URL to article:  https://www.wind-watch.org/news/2011/10/21/albertas-wind-power-producers-face-energy-storage-challenge/