• Total Project Cost estimated at $2.5 to $2.7 Million (based on bids received by other municipal utilities)

SELCO Minutes 053018

• M. Hale recommended that the Commission vote to authorize the General Manager to sign MMWEC’s Pooled Loan documents for the 2.5MW gas peaker generator.  The project is estimated to cose $2.8M and is being funded by a combination of available cash and the issuance of debt, in the amount of $2.2M, through MMWEC’s pooled financing program.

Examples of other MLPs installing Natural Gas Peaker Plants:

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SHREWSBURY ENERGY STORAGE VIDEOS

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RECOMMENDED ENERGY STORAGE VIDEOS

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SHREWSBURY ENERGY STORAGE IN THE NEWS

10/12/17 – SELCO Commission Minutes – Oct 12th, 2017

7. Review and Consider Approval of Gas Peaker Unit

Bryan Moss, a Shrewsbury resident, requested an opportunity to address the Commission.  Although he stated that he is in full support of the concept of peak shaving, he would like the Commission to discuss other energy options.

Included in Mr. Moss’s presentation was a time line of climate change, the financial impact of climate change. catastrophic climate change, climate mitigation adaption, financial risks, fossil fuel risks, carbon free renewables i.e. solar energy, battery storage, and a 30% tax credit. He invited the Commission to ask questions.

Mr. Moss reported that UMass has recently divested themselves of all fossil fuels – oil,
natural gas, and coal quoting a UMass representative as saying “these investments are not viable for the future.”

In closing, Mr. Moss requested that the Commission delay their vote authorizing the
installation of a gas peaker plant until all discovery information can be righted on; economic viability of energy storage or vote to proceed with the gas peaker plant solution agnostic so the RFP is open to both natural gas and energy storage companies to bid allowing more competition. He quoted the Sterling Electric General Manager, “Battery storage, in the next ten to fifteen years, is going to be an almost mandatory thing to have; it’s an absolute no brainer to put this type of system in place now to protect yourself from the rising cost of capacity.”

Mr. Moss thanked the Commission for the opportunity to present his views.

M. Hale recommended that the Commission vote to authorize the expenditure of funds for the purpose of installing a 2.5 MW natural gas fired generator for the purpose of improving reliability and reducing transmission and capacity payments.

He said that SELCO has been investigating different energy alternatives to control capacity including solar, battery storage, and natural gas peaker units since 2012. Most customers, residential and commercial, are not interested in voluntary load shedding/peak shaving programs. Sterling received a substantial subsidy for their battery storage project which has worked very well.

The Commission reviewed a financial analysis that was prepared comparing battery storage and natural gas peaker of which the economic results clearly pointed to investing in the natural gas peaker.

M. Hale stated that, at this time, he recommends proceeding with a 2.5MW gas peaker and delay the second 2.5MW investment for a few years. He added that the proposed natural gas peaker unit is expected to run an average of twenty hours per month.

Following further discussion,

A motion:

Accept the recommendations of tile General Manager to provide for a gas peaking plant on terms set forth.

Motion made by M. Refolo and seconded by A. Trippi.

Following a brief discussion, the motion was approved unanimously.

R. Holland requested that it be noted in the minutes that SELCO will continue to also
actively pursue battery storage options.

The Commission thanked Mr. Moss for his presentation.

09/06/17 – Shrewsbury town meeting OK gas line extensions, solar deal

SHREWSBURY – After less debate than expected, town meeting members overwhelminghly approved the extension of gas service lines to residents near Centech Boulevard.

Bryan R. Moss, Precinct 8 town meeting member, who is opposed to fossil fuels, acknowledged that SELCO’s efforts would save the town money. But he said he opposed the article because the town needs to look more toward renewable fuels.

“We need to do something different than business as usual,” he said.

Benjamin Tartaglia, a town meeting member from Precinct 6, said the measure, which he referred to as “the Shrewsbury pipeline,” encourages the use of more gas. He said the gas extension might aid the controversial $3.2 billion Access Northeast natural gas pipeline that would have gone through Shrewsbury and several surrounding Central Massachusetts communties. The proposal has been put on hold because of a lack of funding.

“I’m concerned in the future it will be used as another reason to put the large gas pipelinie through town,” he said. “Is there any way this smaller pipeline would impact our other gas uses in town that would encourage us to have to vote for a larger pipeline through town?”

Mr. Hale said it would not. He said the extension is not a pipeline.

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ENERGY STORAGE IN THE NEWS

08/01/19 – UMass attaches largest label to Dartmouth battery storage system

10/25/18 – Braintree adds electricity storage

09/09/18 – Tesla Energy is quietly setting its sights on peaker plants

12/07/17 – UMass Amherst Receives $1.1 Million Grant for Large Battery Project to be Built with Tesla

11/08/17 – A big 48 MWh Tesla Powerpack system will power the island of Nantucket

10/04/17 – ENGIE North America Announces Largest Utility-Scale Energy Storage Installation in Massachusetts

3 MW/6 MWh energy storage system to be installed at Mt. Tom Solar, adjacent to former coal plant; benefits include lower utility capacity costs/demand charges, reduced stress on electric grid, and optimization of solar energy

HOLYOKE, Mass.–(BUSINESS WIRE)–ENGIE North America and Holyoke Gas & Electric (HG&E) today announced plans for the largest utility-scale energy storage installation in Massachusetts. Green Charge, an ENGIE NA subsidiary, will operate the three-megawatt energy storage system at Mt. Tom Solar, which began operation in January of this year adjacent to the former Mt. Tom Power Station. The system will be used to optimize intermittent solar energy and reduce utility capacity costs for HG&E, the system’s customer, while reducing stress on the HG&E distribution system. This project will contribute to rate stabilization for HG&E customers over the next 20 years. In addition, customers will benefit from improved power quality and reliability. Green Charge expects to complete installation by April 2018, in time for the peak summer months when capacity costs are highest.

10/04/17 – California rejects gas peaker plant, seeks clean energy alternatives

The California Public Utilities Commission rejected a refurbishment of the Southern California Edison’s Ellwood Peaker Plant, paving the way for a solar+storage solution instead.

Critics of Southern California Edison’s (SCE) Ellwood Peaker Plant are hailing the California Public Utilities Commission’s (CPUC) decision to reject unanimously a taxpayer-funded refurbishment of the plant, saying it affords the utility an opportunity to put more solar+storage into operation.

The CPUC also indicated that they would like to re-evaluate its approval of another gas peaker plant that has yet to be built.

“At this time, absent very compelling circumstances, we should be directing all of our investments in infrastructure and energy to clean energy resources,” said Clifford Rechtschaffen, one of the commissioners. “The proposed refurbishment is not a good use of ratepayer dollars.”

08/01/17 – Tesla batteries could serve as back up for Massachusetts wind farm/

04/14/17 – Small Community Saves Big with Energy Storage

The little town of Sterling, MA is getting a lot of attention these days. Not only has the Sterling Municipal Light Department (SMLD) won awards for its new solar+storage microgrid, the town is getting visitors from Germany, Japan, Norway and many other countries. The visitors come to see an innocuous-looking metal box at the utility’s electrical substation; the box houses 2 megawatts of lithium-ion batteries, capable of nearly four hours of continuous maximum discharge. The batteries, along with a 3 MW solar array, can be islanded in case of a power outage and will support the town’s police station and emergency dispatch center for at least two weeks – more with solar recharging – meaning Sterling’s first responders will be able to help people in need if a natural disaster knocks out the regional grid. But these resilient power benefits, however important, are not the reason for all the attention.

Sterling is in the spotlight because its municipal utility can use the new battery system to control rising power costs. This benefits the town’s ratepayers, but it also benefits the entire New England region; and it means the $2.7 million battery system will pay itself off in about two years, with grant funding from Massachusetts Department of Energy Resources (DOER) and U.S. Department of Energy Office of Electricity (DOE-OE). But even without the grants, the system would still achieve a payback period of fewer than 7 years… pretty good considering that the batteries come with a 10-year performance warranty and are expected to continue to function significantly longer than that.

According to an upcoming paper by Sandia National Laboratory, which 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. 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 by discharging its batteries to offset electricity purchases from the New England grid operator. Sterling Municipal Light Department will attempt to do the same in 2017 and each year thereafter.

A second source of significant 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 that month. In December 2016, SMLD successfully discharged its batteries during the monthly peak, saving its ratepayers $17,000 for one hour. That’s a significant savings for a municipal utility with an annual budget of $8.2 million. SMLD repeated this performance in March and, with the batteries now fully operational, SMLD hopes to continue to hit monthly peaks on a regular basis.

In addition to these savings, SMLD will use its batteries to engage in arbitrage—that is, discharging the batteries for self-consumption when grid power is priced the highest; and for frequency regulation—a grid-balancing service that batteries can provide, and be paid for.

With all these cost savings and revenues, SMLD conservatively estimates the economic benefits from the batteries are worth $400,000/year to utility’s ratepayers. Of course, that doesn’t include some of the most significant unpaid benefits of the system, such as integrating the large amount of solar PV on Sterling’s system, reducing emissions from fossil fueled power plants, and providing backup power in case of a natural disaster that knocks out the regional grid. It’s no wonder Sterling’s success is being closely watched by many other municipal utilities and electric coops in New England, several of which are actively working to build their own battery systems.

So, what does all this mean for the regional grid? For 100 years, the electric grids have been based on big, centrally-located fossil fueled and nuclear generating plants, sending one-way flows of electricity down transmission lines to distribution utilities, who in turn supplied power to their customers. In New England and many other regions, the whole system is regulated by the Independent System Operator (ISO), which makes sure that electricity supply exactly meets demand in real time. That means that every day, the ISO is signaling expensive and highly polluting gas ‘peaker’ plants to ramp their generation up and down, following a fluctuating load.

That’s all about to change. If a small municipal utility like Sterling can save big money by relying on its own batteries rather than expensive peaker plants, other utilities can do the same. And when enough utilities install batteries, it will change the face of the grid. It will mean more renewables can be deployed, without the intermittency that can cause demand spikes; more grid services can be provided by distributed resources, increasing competition and opening markets; and more municipalities can take control of their energy purchases and costs. It will also mean more energy resiliency in local communities, where solar+storage can provide critical backup power during emergencies. That’s a new electricity business model that lowers costs, is good for the environment, and potentially saves lives.

06/30/17 – Baker-Polito Administration Sets 200 Megawatt-Hour Energy Storage Target

Commits up to $10 Million of Additional Funding and to Examining Inclusion of Additional Energy Storage Technologies in Commonwealth’s Portfolio Standard

“Energy storage has the ability to unlock the full potential of clean, renewable energy resources, while reducing ratepayer costs and emissions.  Today’s target will continue Massachusetts’ leadership in developing and adopting innovative clean energy technologies and policies that ensure we have a clean, affordable, and resilient energy future.”
–Lieutenant Governor Karyn Polito

“State of Charge showed that energy storage has the potential to be a game changer for Massachusetts, with hundreds of millions of dollars of ratepayer and system benefits.  The 200MWh target, developed with the feedback of a wide range of stakeholders, will build upon the Baker-Polito Administration’s commitment to growing the deployment of energy storage throughout the Commonwealth.”
–Secretary of Energy and Environmental Affairs Matthew Beaton

As you are aware, on December 27, 2016, the Depaiiment of Energy Resources (DOER)
determined that it is prudent for the Commonwealth to set targets for electric distribution companies (EDCs) to procure energy storage systems, pursuant to An Act Relative to Energy Diversity, Chapter 188 of the Acts of 2016 (The Act) signed into law by Governor Baker August 8, 2016. Section 15(b) of the Act fmiher states that, “the department shall adopt the procurement targets, if determined to be appropriate under subsection (a), by July 1, 2017”.

That report, State of Charge, was released on September 16, 2016 and determined that energy storage has the potential to be a game changer for Massachusetts, with hundreds of millions of dollars in benefits for ratepayers.

The Act requires that, “[ n ]ot later than January 1, 2020, each electric company entity shall submit a report to the department of energy resources demonstrating that it has complied with the energy storage system procurement targets and policies adopted by the department…” DOER is requesting that the electric distribution companies submit annual reports beginning January 1, 2018 to inform state policy on the cost effectiveness and viability of energy storage in a variety of ownership models and use cases. To ensure the state can best leverage any findings and lessons learned from this target, DOER expects to be informed of how many MW and MWh each EDC procured, the types of energy storage procured, the cost-effectiveness of the various energy storage projects undertaken, wholesale market opportunities identified and monetized, how market barriers to the adoption of energy storage were addressed and resolved, and recommendations, if any, for energy storage programs and policies going forward. After review of the submitted reports, DOER will determine if an additional energy storage target for electric distribution companies will benefit ratepayers.

06/14/17 – Baker-Polito Administration Announces Over $4.6 Million in Grants for Peak Demand Reduction Projects

“Today’s grants will ensure that the Commonwealth remains at the forefront of energy innovation by utilizing emerging technologies to reduce peak energy usage.  From residential customers to municipal governments, these grants have the potential to have a serious impact for Massachusetts’ innovation economy and ratepayers.”
–Lieutenant Governor Karyn Polito

“Reducing peak demand usage is a critical component of achieving our Global Warming Solutions Act emission reduction goals and making energy more affordable for all ratepayers.  The business models tested by these grants will build upon the advancements we have come to expect from our Massachusetts’ companies for the benefit all ratepayers.”
–Secretary of Energy and Environmental Affairs Matthew Beaton