The entire electricity distribution grid — designed for one-way power flows from central generation toward consumers — is poorly suited to meet the four key needs of our future for following reasons:
- demands linked to integration of large amounts of decentralised power generation
- the rise of electric vehicles (EVs) and electrified heating
- weather- and security-driven resiliency
- security from increasing cyber threats
If we continue to reconstruct and expand the grid using the model from the past 50 years, doubling down on an inflexible design which serves the past, not the future, we will not only throw away a valuable asset (the existing grid) but we will not be able to meet our flexibility needs.
Planning cycles are long (though getting shorter) but it is fundamentally impossible to accurately plan for any of the four key trends because they are not driven by the utility, they are driven by multiple outside forces that have their own motivations, often misaligned with utility goals. Utility response is typically to perform reactive design instead of proactive planning, resulting in long timelines even for projects that align with utility motives such as increased EV charging (more power sales).
The distribution grid has an average loading of around 50%. Effectively, we only get 50% of the value available from existing poles, wires, and substations because they are designed for peak loads which far exceed averages.
What is needed is a flexible, quickly-deployed (and redeployable) grid-expansion architecture that makes the best use of the existing distribution grid assets. A method to boost average grid utilisation to 60%, 70% or 80% would represent tremendous cost savings, if it can be done while maintaining or increasing reliability.
Battery energy storage, deployed at the grid edge, can answer all the key needs.
Increased grid-edge storage allows more decentralised generation to be installed since the batteries can store levelised energy flows in both directions.
- Many buildings and EV charging stations can be connected to existing grid resources if they average their load. Many more can be served by existing grids with nominal additional on-site generation. This allows a decoupling of grid improvements from decarbonisation and electrification efforts.
- Storage is a fundamental component of local resilience. The problem has been paying for the batteries when they are deployed without creating multiple benefits, without deferring some other cost.
- Local generation, local storage, and the ability for local control are key weapons against widespread cyber-attacks. Both because these new systems can incorporate controls that were not available when the distribution grid was constructed, and because smaller local systems will be easier and faster to restart after an attack does happen.
Battery energy storage is decreasing in price faster than solar panels did. Just as PV and wind have matured to be the least-cost new energy sources in most areas of the world, energy storage is on a similar (but faster) path of cost reduction.
At prices available today, deploying distributed storage can be less expensive than a traditional grid upgrade project. Since storage deployments can be phased, this allows rapid, flexible response.
Storage also has the advantage of not necessarily needing to understand, and control individual user loads. It can be effectively deployed both proactively and reactively, in connection with a load or simply as a system asset. In some areas, storage installations will result in a deferral of grid upgrades. In others, it may be possible to eliminate the traditional upgrade.
It is time for utilities and regulatory commissions to fully embrace the opportunities that modern distributed energy storage can create. We cannot afford to throw away the existing grid asset, nor can we slow down in the electrification of everything.
Jeff Wolfe is a serial cleantech entrepreneur and CEO of Veloce Energy, a technology company focusing on reducing costs for EV charging stations and increasing grid resilience. He founded PV installer groSolar in 1998, which was sold to EDF Renewables in 2016.