How EPCs can command the growing energy storage market

By Dhruv Patel, senior VP of renewable energy and storage, McCarthy Building Companies

Last year was a standout for energy storage. U.S. installations of advanced energy storage — almost entirely lithium-ion battery systems — exceeded the 1-GW mark in 2020, and the national Energy Storage Association (ESA) anticipates adding 100 GW of new storage resources to the mix by 2030.

Experts foresee storage being an important aspect of virtually every utility-scale solar project going forward. And if they’re not installing storage today, more solar project owners want to at least have a storage-ready system for easy installation later. The solar and storage industries are already synergetic, and their dual success going forward will depend on EPCs contributing their expertise to both areas equally.

Supply-chain constraints

LS Power’s 250-MW Gateway Energy Storage Project located in San Diego County, California, was built by McCarthy Building Companies and was the largest operational battery storage facility in the world at the time it was fully energized in 2020.

This unprecedented demand for storage has led to supply chain constraints. This is partly being caused by the electric vehicle (EV) market taking up an enormous amount of battery supply — EVs use lithium-ion batteries, which are also the most common battery type used in solar + storage projects. As new technologies are developed and as supply chain issues escalate, more utility-scale project owners will likely be forced to consider non-lithium options.

Mitigating potential risks associated with the use of new technology is one way that an integrated EPC firm can assist in evaluating and prequalifying new technologies prior to using them. Conducting extensive due diligence on new technology with the engagement of a third party provides project owners with more analysis and clarity on how projects will function.

Early engagement and committing to partners at each level within the supply chain is the best way to combat constraints as lead times increase throughout the entire chain. Additionally, early engagement allows the EPC to identify other opportunities that can ease supply chain constraints. For example, prefabrication of various elements of a storage project can help manage supplier issues, enhance schedules and provide price certainty on a project.

Challenges make room for innovation

By identifying opportunities for prefabricating elements of a storage project, such as duct banks and conduit stub ups, EPCs are helping to reduce the impact of supply chain constraints, scheduling and provide price certainty.

Advancements in technology are happening quickly in the storage sector. Through collaborations with partners during a storage project’s design phase, teams can focus on innovation to fully enhance facility performance and efficiency.

Two areas of innovation that McCarthy’s renewable energy and storage team recently assisted with are centered around remote commissioning and reactive power strategy.

Remote commissioning: In partnership with a third-party integrator, McCarthy developed virtual technology that allows for remote commissioning of storage projects. This innovation results in an expedited commissioning process, optimized overall schedule and cost savings.

Reactive power strategy: By taking a critical look at the use-case of the battery, solar system and substation separately, engineers developed a reactive power strategy. Teams evaluate and adjust equipment throughout the design process to incorporate solutions that better address power capacity and interconnection requirements of the utility. This results in cost savings by minimizing the number of inverters and capacitor banks needed in the substation, which also yields schedule benefits.

Through an EPC’s extensive knowledge of solar projects’ interactions with utilities and the grid, energy storage projects can be optimized to work at peak performance.

A case for storage-ready projects

An aerial view of the Gateway Energy Storage project

Dependable renewable power sources are crucial as utilities across the country pursue carbon-neutral goals. Knowledgeable EPC firms help developers and utilities with their overall power strategy, taking both solar and storage into account.

Ideally, integrating energy storage with a solar PV system should be considered from the beginning of a project’s lifecycle, but adding storage at any stage in development and construction is possible. With current supply chain issues, a long-term approach — building storage-ready sites — may be the best option for solar developers to minimize future costs. Integrated EPCs can provide technical modeling to deploy energy storage systems in combination with the solar facility to optimize the use of key components now and in the future. Storage-ready projects are much more marketable to utilities that are increasingly looking for the grid-stability and reliability benefits that storage offers.

EPCs have gained the experience and expertise and have the relationships with developers, independent power producers, utilities and permitting authorities to successfully navigate the complex challenges of storage integration and installation. The key to success for any solar + storage project is working with an experienced EPC team that can guide the site owner to the best possible outcome using innovative solutions and advanced technologies.

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