Like every electric utility in Colorado, your local electric cooperative is managing a lot of change right now. State policies are phasing out the old workhorse of electrical generation — coal-fired power plants — and rapidly expanding wind and solar power, which have many benefits but only produce electricity when the wind blows or the sun shines. And what used to be a one-way flow of electrons from power plants to consumers is increasingly a two-way street as residential solar grows dramatically.
Fortunately, co-ops are innovating with new technologies that manage the changing electricity system: hardware and software to visualize and control what’s happening on their grids, smart inverters that adapt solar output to local grid conditions, and — the biggest game changer — batteries and other devices to store energy.
Holy Cross Energy, for example, pairs solar power with battery storage to “throttle up and down the output from our solar-plus-storage resources just as a utility would turn up or down the output of a conventional power plant,” said Bryan Hannegan, president and CEO of the Glenwood Springs-based electric cooperative.
In addition to making solar output more reliable, energy storage enables co-ops to reduce electricity consumption during periods of high demand. “Our distributed storage capacity allows us to move a large part of the electric heating load on our system to the inexpensive off-peak period,” said Jack Snell, energy services manager for San Isabel Electric Association, an electric co-op based in Pueblo West.
These features won’t sound very important until one understands how they allow electric co-ops to reduce costs and potentially avoid raising rates.
Because of physical laws, electricity generation must always match consumption. If supply runs short of demand, grid operators might have to take radical measures such as disconnecting sections of the grid to avoid damaging system infrastructure and electric appliances.
Therefore, Colorado’s electric grid is built to supply the maximum electricity demand that could occur at any time — such as on a frigid winter morning. A share of the cost of building and operating the power plants, high-voltage power lines, substations, transformers, poles, and wires needed to meet that maximum — or peak — demand is passed on to your co-op. This demand charge is the co-op’s share of the total system capacity that wholesale power suppliers have to build and maintain to serve the combined set of peak demands on their system, explained Hannegan.
Wholesale power suppliers base demand charges on how much electricity a utility uses during the one hour each month when regional electric demand peaks. With energy storage, utilities can stock up on or store electricity when demand is low and there’s excess capacity, then dispatch that stored electricity to offset their usage during peak periods when demand charges are set.
Colorado’s electric co-ops have installed hundreds of megawatt-hours of battery electric storage systems — and they have hundreds more MWh in development. Some co-ops are investing in their own large batteries that are usually paired with solar, tapping into smaller batteries owned by their consumer-members — again, typically paired with solar — or both.
Holy Cross Energy is bringing online 55 MWh of co-op owned battery storage paired with solar power plants while contracting with growing numbers of consumer-members who install solar and battery systems and agree to let the co-op charge and discharge their batteries at necessary times. “These members help us by contributing power when needed, consuming power when there’s excess solar or wind power, and shifting demand from one part of the day when electricity is expensive to another part of the day when it’s not,” Hannegan explained.
It’s important to mention that utilities can store electricity without batteries. San Isabel Electric Association uses heat stored in ceramic brick structures built into home heaters. About 1,500 SIEA consumer-members have installed electric thermal storage heaters from Steffes, and, collectively, they shift about 10 MW of electric load away from peak demand periods when that costly demand charge is calculated.
The key to making this work is a time-of-use billing system that gives electric thermal storage heater users a sharply discounted rate for heating up those bricks during off-peak periods. SIEA sells the ETS units, installs, and services them; the co-op even provides a lifetime warranty for a one-time fee. “This inspires confidence,” said Snell.
“They know that the co-op is never going to exit this market, that we’ll always be here for them.”
About the Author
Jim Hight is a writer, research analyst, and consultant based in Buena Vista where he is a grateful member of Sangre de Cristo Electric Association.
