By Rob Smith / ecoRI News staff

November 21, 2024

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PASCOAG, R.I. — When it comes to renewable energy, an out-of-the-way industrial park in the state’s northwest corner seems an unlikely place to catch a glimpse of future technology. Yet, dozens of drivers travel down South Main Street every day without knowing a quiet beachhead has been established on Davis Drive.

Modest in size and scope, occupying only 1,600 square feet sandwiched between nondescript industrial buildings and parking lots, is the state’s first — and to date, only — renewable energy storage facility. Compared to Rhode Island’s high-profile ground-mounted solar arrays and offshore wind turbines, it’s tiny. To most passersby, it probably doesn’t look like much, similar to any other piece of industrial equipment dotting the landscape of the state’s vanishing manufacturing businesses.

Commissioned by the Pascoag Utility District, and owned and operated by Wakefield, Mass.-based Agilitas Energy, a renewable energy developer that specializes in energy storage, the battery array draws and stores 3 megawatts (MW) of power that the district can use during peak load times.

The impetus for the state’s first battery array came down to practicality. The utility district, then-general manager Mike Kirkwood told ecoRI News in 2022, generated little of its own power within the town of Burrillville. The district relied on purchase agreements with power stations outside the district’s jurisdiction.

Battery storage made a lot of sense to give the district power grid a boost during peak times. “For us it became a really good, cost-effective solution,” Kirkwood said.

The battery storage facility on Davis Drive has been operational since June 2022, and in the 2½ years since, it remains the only utility-scale battery storage project of its kind in Rhode Island. Other projects have been proposed, most recently by the Quonset Development Corp., which operates a special business district at the Port of Davisville in North Kingstown. It is seeking permitting for a 200-plus MW battery storage facility on Callahan Road, and has suggested moving the town’s fire station to make room for it.

“I see storage as an investment that helps us balance our electrical grid and manage our energy costs,” said Kat Burnham, senior principal at Advanced Energy United, an energy trade association. “It helps us — the only way we’re able to invest and integrate more local energy resources here in Rhode Island is by investing prudently in the system and storage.”

Compared to other important natural resources, the United States is pretty bad at stockpiling electricity for future use. Other resources considered necessary for society to function, whether it’s crude oil and petroleum products or the salt stockpiled by New England towns to coat winter roads against snow and ice, are stored in great quantities on a regular basis, but surplus electricity is more often wasted and fed into the ground than put into storage for later.

In concept, the process is similar to charging a smartphone. At utility-scale battery projects, a lithium-ion battery, the same kind used in electric vehicles, smartphones, and other electronics, draws power from the electrical grid, with the goal of discharging it at a later date. Ideally, a battery storage facility will draw power from the electrical grid during off-peak hours, such as the middle of the night or the wee hours of the morning when people are less likely to use electricity. It can bolster the electric grid during peak demand times and ensure that residents get every last drop they can out of renewables, where generation capabilities ebb and flow with the wind and the sun.

“Storage doesn’t fit in a tidy box as a net producer or consumer of electricity,” Burnham said. “It can do both, and the way it’s recognized on the system doesn’t match what we have in practice today.”

It’s an industry that has seen a lot of growth over the past five years. By July of this year the United States had cumulatively some 20 gigawatts of utility-scale battery power capacity, with 25% of that total coming online in the first seven months of this year. A January projection from the federal Energy Information Administration estimated total installed capacity will double by the end of 2025.

“We need to get the policy mechanism right, so storage developers will see Rhode Island as fertile ground to build the projects that are going to be part of the clean energy transition, electrifying our buildings and the vehicles,” said Natalie Treat, director of public policy for The Alliance for Climate Transition (ACT).

Energy storage policy in Rhode Island is in its infancy. The storage facility built for the Pascoag Utility District received a $1.4 million loan from the Rhode Island Infrastructure Bank’s Efficient Buildings Fund, which finances renewable energy projects for municipalities and agencies, and a separate $250,000 grant from the state Office of Energy Resources (OER).

Energy storage has four different state programs from which to draw funds for procurement. Two of them, ConnectedSolutions and the System Reliability Procurement, are run by Rhode Island Energy. There’s also the Renewable Energy Fund, administered by Rhode Island Commerce and used to award grants to renewable energy projects. The fourth program is run by ISO New England, the nonprofit that operates the regional electric grid, and comes in the form of market tariffs — think of a payment contract rather than a tax on international trade.

These programs have led to a bit of energy storage, but little of it is at scale. The state’s Clean Energy Portfolio, maintained by OER, lists 1,066 connected residential energy storage projects, with another nine in the commercial sector. The bulk of these are attached to existing solar panels or arrays. Combined, it has a total storage capacity of about 9 MW.

State lawmakers are slowly getting on board. At the end of the legislative session in 2022, the Senate passed a resolution requesting the Public Utilities Commission, the regulator in charge of much of the oversight for electricity and other utilities, produce a study examining the cost and benefits for renewable energy storage resources in Rhode Island.

The final report, issued by the PUC on Oct. 18, 2023, noted energy storage in Rhode Island carried numerous benefits, including reducing the market price of electricity, improving the quality and performance of electric power, relieving the electrical grid of peak conditions via peak shaving, and providing a backup power source during grid outages. But those benefits only remain beneficial so long as the technology remains inexpensive enough to be deployed.

“For a storage resource to be net beneficial, the value of its benefits must exceed its costs,” according to the report. “There are alternative resources available in the market today that, in some instances, can deliver the same benefits as storage for a lower cost; there are also likely instances in which storage is the best alternative in terms of both cost and net benefits.”

But while the report was positive on battery storage’s role in the state’s renewable energy transition, it downplayed Rhode Island’s need for storage in accomplishing the near-term goals of the Act on Climate and Renewable Energy Standard, state laws that set specific goals for carbon emission reductions and renewable energy procurement targets, respectively.

“While storage is not likely needed in the near term to meet the RES and Act on Climate mandates,” reads the commission’s report, “the PUC expects storage likely will be needed some time after 2030 to balance new supplies of renewable energy generation with load and to avoid renewable energy curtailment.”

Lawmakers picked up the baton for energy storage this year when they passed the Energy Storage Systems Act, legislation setting out benchmarks and goals for energy storage adoption in Rhode Island.

The bill, sponsored in the Senate by Sen. Dawn Euer, D-Newport, and in the House by Rep. Arthur Handy, D-Cranston, mandates the state install 90 MW of energy storage by the end of 2026, 195 MW by the end of 2028, and 600 MW of energy storage by the end of 2033.

“Moving to renewable electricity means we are going to need the structures — both physical and regulatory — to store energy,” Euer said in a statement upon the bill’s passage in June. “This bill sets concrete goals and action plans to build a resilient grid that can accommodate the green energy transition that is happening now.”

The new law directs the PUC to come up with a tariff framework for energy storage projects connecting to the electrical grid, as well as another tariff for interconnection, and the Rhode Island Infrastructure Bank and OER to draw up programs to distribute funding for storage projects. The PUC has until May 1 to complete its tariff policy for storage, and would have to conduct a market survey of storage technologies at least once every three years.

Burnham said she’s optimistic about the new law, and future deployment of energy storage in Rhode Island, but noted that it’s up to policymakers to ensure the new programs are executed.

“Investments are an important thing,” she said. “Storage costs have come down significantly, which is really encouraging, and we know that it can offer cost savings to rate payers into the system, but we need to invest in getting this industry going.”

Progress on rolling out the law has been slow. The PUC opened two sub-dockets on energy storage tariffs at the beginning of September, but has done little else since then, and there’s less than six months left before their work is due. The legislation did include $100,000 to hire consultants to work on the tariff framework.

“We need tariffs that are going to allow developers to charge and discharge and trust that they will be seen as a resource, that’s the basic thing,” said Treat, of the Alliance for Climate Transition. “Utilities are used to seeing anything new on the grid as a burden, something that is going to cost money, and it’s a slow evolution to get utilities on board.”

Neighboring Massachusetts already has a suite of programs and incentives to encourage renewable energy developers to construct storage. In 2018, the state set an ambitious goal for energy storage: 1,000 MW of storage capacity by the end of 2025.

As of this year, only 569 MW of storage capacity have been installed, but data estimates from the Massachusetts Department of Energy Resources show some 8,800 MW is in development.

Rhode Island could copy a number of the Bay State’s programs to induce energy storage, according to Treat. For instance, Massachusetts has a Clean Peak Energy Standard which incentivizes technology that supplies electricity or reduces peak demand periods for electricity.

“States should be talking to each other and sharing notes,” Treat said. “The more regionalization that can happen, as we’re seeing on wind procurement, can be a cost savings for state’s too.”

Despite Massachusetts’ actions on energy storage, said Treat, the state is still hamstrung by the same renewable energy growing pains as the rest of New England: bottlenecks form during the permitting or siting processes, and at the points of interconnection with the electrical grid. The counter to this, said Treat, is transparency with infrastructure and with data.

“Having transparency from the utility company, Rhode Island Energy, is important,” Treat said. “What does the grid look like? Where is their availability on the grid, where is their need for storage? Having more data sharing will be really helpful as well.”

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