The chief executive officer of Northeastern Rural Electric Membership Corp. says a recently-launched battery storage program will help the co-op offset its transmission costs. The program, launched in conjunction with North Carolina-based FlexGen, is expected to save consumers more than $35 million over the next 20 years, according to the co-op.
Eric Jung says NREMC’s transmission costs have been increasing about 14% annually over the last six years. “Little did we know when we got to the end of this that the project would already be positive for us; the output from the batteries would more than offset the additional cost of installing the batteries.”
Jung says the program will involve five battery storage sites adjacent to the co-op’s existing substations. He says the idea is to discharge the batteries at peak times when transmission costs are at their highest, which reduces costs for consumers.
“We’ve tried several smaller programs – water heater switches, thermostat programs – all of which are very effective, but scaling them out to a utility-scale level has been difficult,” said Jung. “For instance, the thermostat program, you’d need thousands of people participating in a program like that to have the equivalent effect of one battery storage project.”
The co-op says the 108-megawatt system would be the largest on record for Indiana and the surrounding states, according to date from Bloomberg New Energy Finance. Jung says the addition of FlexGen to the project followed a lengthy search for a partner.
“Obviously, we’re new to this and we needed someone that would help us with handling the maintenance moving forward, and that would be alongside us to help operate the system moving forward. FlexGen offered the perfect package in that regard.”
NREMC has a 20-year contract with FlexGen, which guarantees the output from the systems and stipulates that FlexGen will handle all of the maintenance costs.
The first two battery sites are expected to be complete by June with two more becoming operational in 2022 and the fifth going online in 2023. Jung says, if the market is favorable, the fifth site might be expedited for completion in 2022 as well.
In addition to bringing down transmission costs, the battery storage sites also bring an added benefit in the event of a power outage. NREMC says the new system would be able to deliver enough on-demand energy to supply three hours of emergency power to 3,200 homes.
Jung adds the co-op has broader long-term goals with the project.
“Several years down the road, we’re hoping to eventually incorporate some renewables along with the storage, so that the storage is then charged not by grid power, as it will be today, but by renewables.”
The sites will be located at the co-op’s substations in Allen and Whitley counties.
Jung says the idea is to discharge the batteries at peak times when transmission costs are at their highest, which reduces costs for consumers.