July 2, 2020 Read More →

Arizona utility APS to rely on battery storage, solar to enable 2031 exit from coal generation

S&P Global Market Intelligence ($):

After a temporary pause in its purchase of battery storage systems following an April 2019 explosion at one of its early projects, Arizona Public Service Co. plans to add at least 2,500 MW of energy storage capacity in the next decade and as much as 10,550 MW by 2035.

The initial fleet will include 750 MW of stand-alone storage and solar-plus-storage plants by the end of 2024 followed by an additional 1,750 MW by 2030. That capacity “will provide the backbone of replacement capacity and energy as we look to exit coal completely by 2031,” the Pinnacle West Capital Corp. utility subsidiary said in its 2020 Integrated Resource Plan filed June 26.

The plan is a blueprint for how Arizona Public Service, or APS, intends to plug resource gaps as roughly 1,400 MW of coal capacity retire and another 1,600 MW of natural gas contracts expire over the next 10 years and to position itself to deliver 100% carbon-free electricity by midcentury.

“Our plan overall is premised on the ability to safely and economically deploy large amounts of energy storage so that we can provide as much of the needed capacity as possible through a combination of renewable resources and storage,” APS said in its resource plan. While the utility has installed only 7.2 MW of storage since 2017, it said, “[W]e believe it is likely feasible and reasonable to reflect in our plans.”

Through 2024, Arizona’s largest utility proposes to add 962 MW of large-scale renewable generation, 750 MW of energy storage, 575 MW of demand-side management, 408 MW of distributed energy, 193 MW of demand response, 6 MW of microgrid capacity and no new gas. After that, three pathways to 2035 pivot largely on different mixes of renewable energy, energy storage and new gas generation plants that will be capable of running partially on hydrogen and which could eventually be converted to run on all carbon-free hydrogen.

A so-called bridge portfolio would reach 79% zero-carbon power by 2035, fueled by additions of 6,450 MW of renewable energy, 4,850 MW of energy storage and 1,859 MW of new gas plants or purchases from existing merchant gas plants. A more aggressive “accelerate portfolio” is designed to hit 91% carbon-free electricity by 2035, relying on 10,375 MW of new renewable energy, 10,550 MW of additional energy storage and no new gas purchases. A middle path, called the “shift” portfolio and reaching 84% clean energy by 2035, would include 7,950 MW of new renewables, 6,500 MW of energy storage and 1,135 MW of hydrogen-capable gas turbines.

[Garrett Hering]

More ($): Arizona Public Service sees energy storage as ‘backbone’ of coal exit

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