Overpowering the Power Outages: Battery Plans Becoming Popular

  • Peter and Donna Hollinger pay for their two Tesla Powerwall batteries with net metering credits earned through sending electricity out into the grid from the 8 kW solar array on their South Strafford, Vt., home, Friday, May 4, 2018. Power outages from storms, including Tropical Storm Irene, motivated the couple to sign up for the Green Mountain Power program that lets customers lease a Tesla Powerwall battery for 10 years at $15 a month. (Valley News - James M. Patterson) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. Valley News — James M. Patterson

  • Jonathan Streeter, of Norwich, Vt., is one of Green Mountain Power's earliest customers to sign on to a program that places Tesla Powerwall batteries in homes for $15 a month to provide electricity during outages and to feed power back into the grid at high usage times. Streeter was photographed with the two batteries installed in his garage in Norwich, Vt., Wednesday, May 2, 2018. (Valley News - James M. Patterson) Copyright Valley News. May not be reprinted or used online without permission. Send requests to permission@vnews.com. Valley News — James M. Patterson

  • From left, a composite of screen captures from the Tesla Powerwall app show; the battery backup history on Jonathan Streeter's phone, a sunny day of solar electricity production followed by evening use of Peter Hollinger's Powerwall batteries, and after Friday night's storm The power grid was down at Streeter's Norwich home, but his solar array kept the power on while charging his battery. (Courtesy Jonathan Streeter and Peter Hollinger)

Valley News Staff Writer
Published: 5/5/2018 11:33:27 PM
Modified: 5/7/2018 9:58:43 AM

Norwich — On Halloween, when a windstorm knocked Linda Gray’s power out for 36 hours, she eyed the pair of large Tesla batteries sitting in her basement with a mixture of frustration and satisfaction.

The batteries, part of a backup energy pilot program offered by Green Mountain Power, were not yet fully installed, so Gray’s immediate future would include melted ice cream, a lack of water, a downed internet connection and, eventually, a $100 bill from the plumber to prime the pumps underpinning the piping in her Norwich home.

That was frustrating.

But within a few days, Gray knew, she would experience the deep satisfaction of watching technicians from a Tesla contractor fully wire the Powerwall batteries into her home’s energy system, marking a solution to short-term power outages. The units measure about 2.5 feet by about 3.5 feet, are 5 inches thick and can either be installed on the floor or mounted on the wall like a flat-screen TV.

A couple of months later, during Super Bowl weekend, Gray got an email from a neighbor letting her know that power had been restored to the neighborhood after a two-hour outage.

“Oh, it was off?” Gray wrote back. “I didn’t know that.”

Though Gray and other early adopters are touting the benefits of the emerging residential battery industry, it remains to be seen whether the technology will prove hardy enough for customers weathering power outages, provide substantive storage for solar power, and ease a $100 million headache for the utility.

That $100 million figure is the low end of what Josh Castonguay, GMP’s chief innovation officer, estimates the company spends each year buying electricity for its customers from out-of-state suppliers during peak usage hours.

“It’s pretty substantial,” Castonguay said. “That’s us paying for a share of all the power plants in New England. Those are some of the uncontrollable costs that our customers bear.”

But Castonguay is betting that, with the battery systems, those costs can, in fact, be controlled.

The basic idea is pretty simple. When GMP has a surplus of energy, it will load the batteries up with low-cost electricity.

Then, when prices spike due to heightened demand, such as hot summer days when air conditioners are running nonstop, GMP plans to tap into all of the energy squirreled away in the batteries, thereby reducing its need to buy high-priced electricity from the market.

Castonguay said the projected savings from what is known as “distributed power” is part of what’s allowed GMP to offer the units so cheaply. To purchase and install a Powerwall, a consumer might expect to spend between $7,000 and $9,000.

In GMP’s program, customers pay much less — they can either spend $1,500 up front, or $15 a month for a 10-year battery-leasing agreement, which works out to $1,800.

Under the agreement, GMP can end the pilot within the first 18 months, and the customer can pay $450 at any time to have GMP remove the Powerwall.

For the last several months, the company has been rolling out a pilot program that it hopes will spread 2,000 Powerwalls among its 265,000 customers. As of two weeks ago, 247 units had been installed, and Castonguay said about 750 more are in the pipeline. The company is accepting inquiries on its website.

Jonathan Streeter, a retired middle school social studies teacher, said his home on Chapel Hill Road in Norwich is subject to frequent outages.

“If the power’s going to go down, it’s going to go down here,” Streeter said.

Streeter said the lengthy and strongly worded contract he received from Tesla gave him pause, but that he’s glad he made the gamble and signed up for two Powerwalls, at a total cost of $30 a month.

“I’m really pleased,” he said.

When a storm threatened two weeks ago, Streeter said, he got a notice from GMP that the company would refrain from drawing the power out of his batteries so that it would be there for him if he needed it.

“So far, everything they said they would do, they’ve done. It’s reassuring to see their end of the bargain is working out,” he said.

Castonguay said there’s wild variation in how long of an outage a fully charged Powerwall can smooth over, mostly because different homes use much different amounts of electricity. The company initially told customers they could count on four to six hours, “but what we’ve seen is way longer,” Castonguay said, though he cautioned that running high-energy systems like hot tubs and electric stoves would have a significant impact. The average power outage lasts for two hours, he said, and no pilot program users have run out of power yet, including one home that had a power outage that lasted 36 hours. On its website, the company now says the average home can be kept running for eight to 12 hours with a single Powerwall.

The Lithium-Ion Solution

Even as companies like GMP, and consumers like Gray and Streeter, move forward, the state’s top decision-makers have been trying to figure out just what role, if any, home storage should play in Vermont’s energy landscape, which is heavily shaped by a state goal to achieve 90 percent renewable energy by 2050.

The most comprehensive analysis to date came in November from the Vermont Department of Public Service, which noted in a report to state legislators that, for better or worse, storage batteries are building momentum.

“Similar to the early days of renewable technology, energy storage systems are finding their way into the mainstream utility plans and portfolios as well as those of private facilities, such as large industrial energy users, healthcare facilities, and even residences,” the report’s authors wrote. “As costs for storage come down, there is increasing interest in demonstrating the potential of storage and gaining familiarity with the value propositions for these systems.”

That interest is palpable. Tesla also has lined up other Vermont partners, including solar companies like SunCommon and Grassroots Solar, as well as developing relationships in other states. In New Hampshire, Liberty Utilities has proposed a pilot program in Lebanon.

Steve Davis owns Vermod, a Wilder-based firm that builds super-efficient, net-zero homes targeted toward low-income homeowners. The company is partnering with GMP to access some of the Powerwalls, he said.

“We’re going to be moving as quick as we can when there’s more (Powerwalls) available,” he said. “Our goal is to have one in every single home, while staying in the affordability market.”

Ashley Andreas, a homeownership adviser with Vermod, said a residential battery from another firm, Sonnen, is installed in Vermod’s model homes, including one that will be on display in Thetford during Thetford 2050, an energy product showcase event planned for July.

The batteries are one more innovative feature that helps to sell cost-conscious and environmentally responsible prospects on a Vermod home.

“It’s definitely the future,” Andreas said. “People who come through can see what they look like, how they work, and what the capacity is. We’re hoping that’s going to catch on.”

Lebanon Plan Debated

Green Mountain Power isn’t the only area utility partnering with Tesla on Powerwalls.

In the Granite State, Liberty Utilities has been pursuing permission to float a pilot program of its own in which 1,000 pilot program customers would pay less — $10 a month, or $1,000 upfront — for a Powerwall battery.

Last week, the New Hampshire Public Utilities Commission received conflicting testimony from stakeholders who differ on whether Liberty’s program should be approved.

The state Office of the Consumer Advocate gave the Liberty proposal a glowing review, calling it “among the most promising in the country,” and saying that it was more consumer-friendly than the GMP plan “because the customer is not only receiving a form of backup power service like in the Green Mountain Power program, but they are also realizing bill savings from” a different proposed rate structure that would allow customers to be more sensitive to price swings created by supply and demand.

Meanwhile, the Public Utilities Commission staff panned the proposal as not being in the public interest. In submissions to the PUC, staff testified that “the proposed program is too expensive and not cost-effective, and that Liberty has not adequately planned and prepared to conduct a pilot of such scale and scope” without running into significant added expenses that ultimately could be passed on to ratepayers.

Testifying on behalf of Lebanon, Councilor Clifton Below, a former PUC commissioner, said the city is “supportive and enthusiastic” about the proposal’s concept, but recommended a long list of changes designed to expand the program and create more savings for customers.

More comments likely will be filed as the PUC’s deliberations continue, with a decision hoped for by the end of June.

Limits of Power

Meanwhile, in Vermont, even as the Department of Public Service was touting the potential of battery storage, it also warned against committing the state’s resources to the home battery bandwagon. It said in its report that storage is just “one tool of many,” and is not yet cost-effective in many cases. It advises that regulators should “proceed with some amount of caution” until more is known.

“The Department recommends an approach that acknowledges the potential benefits of storage technologies without going ‘all in’ before better information is available,” wrote the report’s authors.

But some people say the batteries provide so many benefits that going all in might be warranted.

“I think this is the way ahead, broadly speaking. It just feels like this is where we’re really going to be able to make renewables work, even when the sun’s not shining,” said Conrad Reining, who expects to install a Powerwall in his family’s East Thetford cape home early this week.

A green energy enthusiast, Reining, who works at Dartmouth College, makes a hobby out of counting watts. He said the battery system is a natural progression for a process that has included weatherizing his home, erecting a super-insulated barn, and installing 4 kilowatts of solar panels that supply about 70 percent of his energy needs.

The batteries might allow him to improve on that figure by boosting his storage of solar-generated power which the Reining family can tap later, rather than consuming electricity from the grid.

“The zombie apocalypse comes along, right?” Reining said. “I could conceivably, if we were really frugal, power the whole place indefinitely with my solar panels and the batteries.”

Reining said communities have an interest in seeing more residential batteries within their borders.

“We’re going to have more storms because of climate change. We’re going to have more outages. But if we’ve hardened up the grid by having more of these,” he said, such systems could make a big difference in making a community more resilient.

“There’s a lot of pluses here,” he said.

The state analysts acknowledged in their report that right now, residential batteries do solve a variety of problems: they increase the resilience of communities to extreme weather events associated with climate change, they are a product of great interest to companies like Tesla that have large research and development budgets, they serve as an on-demand energy source that makes it easier for utilities to keep the grid running at the proper frequency, they add functionality to solar panels, and they help to reduce the high costs of meeting peak demand.

The report finds that these and a host of other benefits all have their own associated value streams. Battery storage becomes cost effective when the benefits can be stacked on top of each other, with government, different industry sectors and private citizens all willing to make an investment.

But the energy landscape is shifting, which means those benefits are unlikely to remain constant, so the long-term viability of any one product is difficult to predict.

If the cost of batteries continues to go down, and efficiencies continue to improve, the Powerwalls sooncould be surpassed by another product.

To accommodate alternative battery brands, GMP also v offering a different “bring your own device” program in which homeowners can purchase and install their own battery, and receive electricity bill credits, ranging from $15 to $54, from GMP.

In the November report, the Department of Public Service recommended that utilities explore solutions that allow for more companies to get involved by offering nonproprietary options. It cited GMP’s program as an example of this flexibility being brought into the marketplace.

“Stakeholders beyond utilities … are also eager to innovate and thrive in the storage arena, and (we) would encourage initiatives that create opportunities for all sectors,” the report’s authors wrote.

Though the future is uncertain, consumers like Gray, who years ago with her late husband, Tom, helped run the American Wind Energy Association, say there’s no sense waiting for the dust to settle.

“They say the technology is going to change, but wait a minute,” Gray said. “You could wait forever for something to get perfected, and in the meantime, you’re not taking advantage of it.”

Peter Hollinger, of Strafford, said he monitors the battery’s power reports using an app on his phone that allows him to view a list of outages.

In early April, the battery powered his home through a 4½-hour outage and a six-hour outage. When he looks at the report on the screen of his phone, he can see that he’s also experienced briefer outages that he didn’t notice — five minutes, or, in one case, nine seconds.

Hollinger hasn’t paid an electric bill since installing solar panels on his home in 2016, and a net-metering program was leaving him with unused credits at the end of the year. Now, those credits are applied to his monthly battery costs, which leaves him with no out-of-pocket costs at all.

“It’s really a no-brainer if you have solar,” Hollinger said.

Matt Hongoltz-Hetling can be reached at mhonghet@vnews.com or 603-727-3211.

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