First Solar Made Good on Its Promise to Beat Out Gas Peakers With Solar and Batteries

 Arizona Public Service will add a 50-megawatt battery system to its fleet for storing solar energy to use during evening peak hours.

The regulated utility revealed Monday that it had signed a 15-year power-purchase agreement with First Solar for the dispatchable solar power. The storage system will be paired with a new 65-megawatt solar plant in western Maricopa County and should be up and running in 2021.

This represents a significant escalation of storage activity for APS, which has developed storage systems at the single-digit-megawatt scale. Fifty megawatts would overpower any battery system in the U.S. today, although Fluence is slated bring a 100-megawatt system online in 2021.

The joint system suggests a new paradigm for solar-rich markets: the solar peak power plant.

“When you look at the desert Southwest, you’re already seeing the growing pains of having so much solar on the system and having to curtail,” said Brad Albert, APS vice president of resource management. “This [project] is a necessary evolution of how we deploy solar energy and take advantage of what we have in abundance in the Southwest.”

The hours that really matter
APS didn’t set out looking for storage, per se.

This project emerged from a request for proposal that started a year ago. It was open to any technology, but the bids had to deliver power between 3 p.m. and 8 p.m. in the summertime.

Those are the peak hours that drive much of the new capacity investments APS will have to make in coming decades, even as the abundance of midday solar power grows.

Bids included conventional renewables, standalone batteries and natural-gas peaking plants, but First Solar’s hybrid solar-storage proposal won out.

The solar plant will charge up the battery during the day and deliver power during the first few hours of the peak window, until the sun sets. That also allows the whole project to qualify for the federal Investment Tax Credit.

Then the battery will kick in and discharge stored power through the rest of the window. It will come with 135 megawatt-hours, providing a bit less than 3 hours' worth of duration at the full 50-megawatt capacity level.

“For anything outside those hours of 3 p.m. to 8 p.m., APS is not buying that,” Albert said. First Solar technically has free rein to play with other revenue streams in the off-hours, provided it can ensure capacity to deliver its obligation when the rush hour starts.

Albert declined to disclose pricing details, but it’s clear from the timing component that this is a structural advance for solar and storage PPAs.

“We have not seen any like that,” Albert confirmed.

Source: Arizona Public Service
Date: Feb 14, 2018