Baker tries to kickstart energy storage business

THE BAKER ADMINISTRATION on Thursday handed out $20 million in energy storage grants, an attempt to kickstart an industry that holds promise in reducing peak electricity demand and increasing the reliability of intermittent forms of renewable energy such as wind and solar.

Most of the projects revolve around storing electricity when it is cheap (off-peak) or readily available (during daylight hours for solar or when the wind is blowing), and then using the stored energy when electricity is expensive (at peak periods) or when renewable energy is not available.

The 26 grants, ranging in size from $221,000 to $1.25 million, triggered an additional $32 million in spending by the applicants and helped fund projects at the new General Electric headquarters in Boston, the Wynn Resorts hotel and casino going up in Everett, Boston Medical Center, and the UMass campuses in Boston and Amherst. Of the 26 projects, 22 rely on lithium ion batteries; the other four use different technology or processes.

The Reading Municipal Light Department’s project is the biggest in terms of energy capacity. With the help of a $1 million state grant, the department plans to use a lithium ion battery to store up to 10,000 kilowatt hours of electricity for use at peak demand times. On the opposite end of the spectrum, Sunrun Inc. of Cambridge received a grant of $560,576 to help finance the installation of lithium ion batteries in individual homes to provide backup for solar power.

The Martha’s Vineyard Transit Authority, with a $545,000 grant, plans to use a lithium ion battery in conjunction with solar power arrays to charge its electric buses and avoid the cost of powering them up during high-cost, peak-demand times.

Robert DeSalvio, the president of Wynn Boston Harbor, said his resort will be the first in the country to integrate batteries into its power management strategy. Wynn officials said on-site solar panels plus two cogeneration units that will run on natural gas will be used to charge the Tesla battery, which is the size of a hotel room, and allow the hotel to reduce its need for energy from the grid during peak-demand times.

Stephen Pike, president of the Massachusetts Clean Energy Center, said the state initially planned to award $10 million in grants but upped the amount to $20 million when high-quality applications began pouring in. Pike said 69 applications were submitted in all. The money for the grant program is coming from payments collected from retail electricity suppliers under a state renewable energy initiative.

Pike said the grant program will test 14 different business models for energy storage and help policymakers decide whether new laws are needed to spur greater development of the industry. He said he hopes the grant program will encourage the energy storage industry to think of Massachusetts as the place to be.

Judith Judson, the commissioner of the Department of Energy Resources, said the state has 7 megawatt hours of energy storage capacity currently and hopes to have 200 megwatt hours by 2020. She called the technology a game changer in terms of reducing the cost of energy and encouraging the development of renewable forms of power.

“Now we can store solar energy for use at night. Now we can store wind energy for when the wind isn’t blowing,” she said.

The region’s power grid operates on the principle that the lowest-cost energy is utilized first. As demand rises, more expensive forms of energy are tapped. At peak-demand periods, the cost is the greatest. Judson said the top 10 percent of demand accounts for 40 percent of the cost.

“Storage can change that. It can disrupt that equation,” Judson said, noting that storage can make it possible to store electricity when it is readily available and use it when electr it’s scarce.