DOE gives $17.1 million energy storage grant

But utilities and the government are increasingly recognizing that energy storage systems are crucial to integrating intermittent renewable energy projects into the smart grid.

Hence the United States Department of EnergyÂ’s finalization of a $17.1 million grant to utility AES to build a 20 megawatt lithium ion battery storage system using A123 SystemsÂ’ technology.

The battery packs will be installed at an AES facility in Johnson City, N.Y., and used to smooth out fluctuations in the power grid. Rather than burn fossil fuels to balance supply and demand, renewable energy from wind, solar or other renewable sources can be stored in the battery systems and released when needed.

That could reduce carbon emissions from so-called frequency regulation by 70 percent, according to the Energy Department.

“The AES project helps reduce carbon emissions and strengthens our energy infrastructure by allowing for more renewable energy sources like solar and wind to contribute to the electrical grid,” Energy Secretary Steven Chu said in a statement. “Bringing more efficiency and reliability to the grid will help cut costs for consumers and power a cleaner energy future.”

California enacted a law this year mandating that regulators determine the amount of energy storage the stateÂ’s three big investor-owned utilities should be required to maintain.

Utility PG&E, for example, is planning a pilot project to tap electricity generated during peak wind farm production to pump compressed air into an underground reservoir. When demand spikes, the reservoir would release the air to run electricity-generating turbines, which are capable of producing 300 megawatts of power.

The utility has also proposed building a “pumped hydro” storage system, which would transfer water from one reservoir to another reservoir at a higher elevation during times of peak renewable energy production. Water in the upper reservoir would then be sent back downhill to power a turbine when electricity demand begins to rise.

In September, the California Energy Commission funded a pilot project proposed by Tesla Motors and SolarCity, a Silicon Valley photovoltaic panel installer, to store electricity generated by residential rooftop solar systems in lithium ion car batteries for use during peak demand. The Sacramento Utility District is undertaking a similar project.