California utility chooses 195MW battery storage deal instead of gas

Southern California Edison has signed a raft of battery-based energy storage contracts for 195MW to meet local capacity requirements, in a major flip from its original plan to build a new 262MW natural gas-peaker plant.

Contracts for seven battery-based energy storage resources totalling 195 MW – including a 100 MW/400 MWh system in Oxnard to be developed by Strata Solar – were signed by Southern California Edison (SCE) last week. The seven contracts now await approval by the California Public Utilities Commission before they can be locked in stone.

The seven contracts are built around the 100MW project to be developed by Strata and will be supported by the six smaller projects which range in size from 10MW to 40MW. The 100MW energy storage project is expected to be completed and brought online by December 2020 and will tie for the world’s largest lithium-ion battery.

“Unlike other solicitations to increase the generation capacity of the overall electric system, this solicitation specifically sought to meet local needs in the Moorpark area and address electrical energy storage needs related to restricted natural gas operations at Southern California Gas Company’s Aliso Canyon Natural Gas Field,” said Colin Cushnie, SCE vice president of Energy Procurement & Management. “SCE targeted clean energy resources through an accelerated competitive bidding to meet this identified need before summer 2021. The solicitation results also support SCE’s clean energy vision for California.

What’s most interesting about the results of this solicitation is that SCE had originally planned to proceed with a 262MW natural gas-peaker plant to be developed by independent power producer NRG – a project which was removed before the final round of siting approval.

The move followed significant work by local activists who rallied against the development of an unnecessary fossil fuel project, and after the issues at the Aliso Canyon facilities.

“The big takeaway is the power of community opposition,” said Earthjustice attorney Matt Vespa, who intervened in the case on behalf of the Sierra Club, speaking to GTM. “Puente was viewed as a done deal.

“It was going to be on the beach, and now we have clean energy investment in that community instead of a gas plant.”

The original “request for offers” dates back to early 2013, originally designed to procure between 215 MW and 290 MW of electrical capacity in the Moorpark sub-area of the Big Creek/Ventura local reliability area to meet the region’s long-term requirements by 2021.

The original solicitation resulted in SCE signing a contract for the 262 MW Puente natural gas-fired generation.

However, when the Aliso Canyon gas leak left large parts of Southern California under-resourced for local capacity, California fast-tracked battery procurement to fill the gap – bringing new projects up and running within 6 months.

Unsurprisingly, as awareness of the capabilities of battery storage became better understood, support for the Puente project dwindled and, spurred on by California’s legislation requiring a zero-carbon grid by 2045, battery storage became increasingly attractive to California’s legislators and SCE.

“This solicitation specifically sought to meet local needs in the Moorpark area and address electrical energy storage needs related to restricted natural gas operations at Southern California Gas Company’s Aliso Canyon Natural Gas Field,” said Colin Cushnie, SCE vice president of Energy Procurement & Management.

“SCE targeted clean energy resources through an accelerated competitive bidding to meet this identified need before summer 2021. The solicitation results also support SCE’s clean energy vision for California.”