Welcome back. We talked more about storage. We talked about a simplified example that illustrated how batteries both next to the power plant and next to the end-users can cause one to rethink power plants electricity systems entirely. Let's talk a little more detail, in this case, we'll talk about utility-scale batteries. That means big ones. Ones that are large, multi megawatts, hundreds of megawatts even, but probably, typically, 50-100 megawatts, something like that. What can they do? Well, we talked about example where they can act as a power plant and avoid the need for building a new power plant and act essentially like a transmission line, avoid the need to make the transmission line larger. But there's lots of other things they can do shown in this graphic here. For example, here are just some examples, for renewable generators let's imagine a scenario where you have a large wind farm. At times, there may not be transmission capacity to get your goods to market, to get your power, your electricity, to the city where it's needed because there's just not enough transmission line. But if you had a battery at your wind turbine farm for example, or at your solar PV installation, you could store it and sell it later. You can do arbitrage. Maybe in the market you serve as the renewable developer, renewable generator, there's peak electricity demand in the late afternoon, but maybe you have a solar system and the sun is to low then, but you could store the electricity and sell it later when the prices are higher. The other one that's shown here is renewable capacity firming. This is another example of how batteries can smooth the use of renewables. Let's imagine a scenario where you own a wind farm and you sell the electricity. The challenge you have is it's hard for you to guarantee your availability of your power at all times. Let's say you have your wind farm and you know sometimes the wind blows stronger and sometimes it blows weaker. You might have good forecasts that you'll have no wind, that's going to happen, but it's still going to happen. When you do a contract with say, a utility or an end-user, the contract would have to say, well, I can't guarantee it's always going to be there all the time. But if you have storage, you can or come close to guarantee. You can say, "Hey, I have my turbines and if the wind isn't blowing I have batteries which I'll charge a lot of peak times so I can essentially guarantee or be very confident that I can provide the electricity when it's needed. That's called firming, renewable capacity firming. You can see how the availability of a battery can help ensure or improve the market value of renewable generation. Because it makes it easier to say, yeah, it'll be there when you need it. System operation. We won't talk too much detail about, but there are ways electricity systems can use batteries to regulate and improve power quality. For example, frequency regulation. A power system has to operate an exact frequency all the time. But let's imagine a scenario where there's a lot of solar on the system and there's a large storm coming in and the solar starts to drop off. Well, that's a big change and of course, the system has to maintain frequency all the time. Maybe the batteries can act as an assist to ensure the system works well. We talked about the investment deferral, opportunity that batteries provide. In the prior example, we talked about, "We have to build a new power plant. Maybe we don't, we'll just add a battery." We talked about that example where it appeared that we had to expand the transmission line. But then you put a battery at the essentially downstream end of the transmission system and all of a sudden, you don't have to do that. These are examples of how batteries can really change the fundamental economics and operation of electricity systems. Here's a more detailed example. Going back to the duck curve, we talked about this is the classic duck curve from California system, and here's an example of how batteries can help that. Let's imagine the old system without Storage when you have this steep ramp. The ramp means we have to get a bunch of power plants up and operating quickly and that can be hard. As we talked about, that's one of the challenges that the duck curve represents. Maybe you have a bunch of steam plants that were designed to do that. Economically, it's hard for these power plants to all turn on really quickly and then turn off really quickly. Economically or financially that might not be a good model for them because they're not actually selling a lot of electricity. As we talked about the duck curve shows the challenges that a large amount of solar PV imposes on electricity system. Let's imagine you don't have batteries though. This shows storage. What we do here, shown by the blue line, is that in the middle of the day, here it's shown at about 2:00, 3:00, 4:00 PM, there's a lot of solar on the system. Instead of running that to serve the end-users, we use that solar to charge the batteries. The blue shows the battery charging. The batteries are charging and notice because of the battery charging essentially, net demand is smoother. The batteries are charging, the batteries at this point are helping to meet the demand by bringing the peak down because the batteries are providing the peak and in this example, they bring the peak way down. This is just a simplified example, but it shows how this would work. The result of the batteries with storage is that ramping is not as steep because the batteries are providing some of the electricity to decline way up this line and the peak is much lower because batteries are providing the peak. That's an example of how batteries can address the duck curve. Another way to think about batteries is what's called behind-the-meter batteries.
