With the approval from CPOC, the utility will deploy over 2.0 GWh of energy storage capacity using battery systems from Tesla and other companies that will replace three natural gas-powered plants being retired.
In January, according to Bloomberg, the CPUC ordered PG&E, the state’s largest utility to find a way to replace the three Calpine Corp. gas plants – suggesting they think about replaced with storage batteries.
PG&E’s plan is in line with Governor Jerry Brown’s legislation that was signed in September requiring the state to get all of its power from carbon-free sources by 2045. The state already has a commitment to obtain 50 percent of its electricity from wind, solar and geothermal power by 2030.
Commissioner Liane Randolph called Thursday’s 4-1 vote “only one step in the broader challenge we face in managing the state’s fossil fuel fleet.” What makes PG&E’s move significant is that this is the first time a utility and its regulators have sought to directly replace multiple major power plants with battery storage.
World’s largest battery system
Three plants owned by Calpine Corp are to be replaced – the 580 MW Metcalf plant and the Feather River and Yuba City generators, both with 48 MW. One other PG&E storage project, actually involves two smaller projects, a 75 MW / 300 MWh facility from Hummingbird Energy Solutions and a 10 MW / 40 MWh facility from battery provider mNOC.
All the projects are expected to be completed and online by the end of 2020. The Tesla project is the only one that PG&E is buying outright. This means that Tesla will charge PG&E for the engineering, procurement, and construction (EPC), while PG&E will buy the energy capacity from the other projects.
The other developers will continue to own their projects. While the cost of the Tesla project has not been disclosed, PG&E will be allowed to recover the costs from ratepayers. But analysts are already projecting the costs will be less expensive than the gas plants they will replace.
“Storage at this scale is likely now cheaper than the total cost to run the gas plants,” Alex Eller, senior energy research analyst at Navigant, told Utility Dive when the solicitation was announced.
The two biggest projects, including the Vistra project, built by subsidiary Dynegy, and the Tesla project will be the world’s largest battery. When Tesla completed its giant Powerpack project in Australia, that one became the largest battery in the world, but these new ones are several times larger.
Dynegy is going to deploy a 300 MW / 1,200 MWh project on PG&E’s grid while the Tesla project will be a 182.5 MW / 730 MWh, which could eventually go up to 1.1 GWh.
