DEP, N.C. regulatory staff call for approval of microgrid pilot

Duke Energy Progress and the North Carolina Utilities Commission Public Staff on March 22 filed a joint proposed order calling for the commission to issue to DEP a certificate of public convenience and necessity for the solar generation-related components of the Hot Springs Microgrid Solar and Battery Storage Facility (Hot Springs Microgrid).

The Hot Springs Microgrid is approved as a pilot, subject to certain reporting requirements, a study of frequency regulation, the imposition of a cap on the above-the-line capital costs of the project, and other conditions proposed by public staff, agreed to by DEP, and set forth in the joint proposed order, according to the filing.

As noted in the joint proposed order, DEP in October 2018 filed a verified application for a certificate of public convenience and necessity to build the generation components of the Hot Springs Microgrid on DEP-leased property in Madison County, N.C. The company also requested appropriate approval from the commission for its decision to build and own the battery storage components of the Hot Springs Microgrid as consistent with the company’s commitment and a March 2016 commission order.

The joint proposed order further noted that the Hot Springs Microgrid consists of an approximately 3-MW direct current (DC)/ 2-MW alternating current (AC) solar photovoltaic (PV) electric generator and an approximately 4-MW lithium-based battery storage facility to be built on one parcel totaling about 15 acres in Madison County, N.C.

In addition to providing energy to the DEP system, the Hot Springs Microgrid should be capable of disconnecting – islanding – from the grid to improve reliability for DEP customers connected to the Hot Springs 22.86-kV feeder, which runs for about 10 miles from the Marshall substation along the French Broad River and through the Great Smoky Mountains. While grid-tied, the Hot Springs Microgrid should be capable of providing such services as frequency, voltage, and ramping support to the electric grid, as well as capacity during system peaks, the joint proposed order added.

The Hot Springs Microgrid would consist of PV panels affixed to ground mount 20 degree fixed-tilt racking, solar inverters, a microgrid controller, and a battery energy storage system (BESS). A lithium-based BESS would be connected and sized so the Hot Springs Microgrid can provide backup power to customer loads during certain outage events, the joint proposed order added.

The Hot Springs Microgrid is a non-wires alternative that should improve reliability for customers in the Town of Hot Springs who are connected to the Hot Springs 22.86-kV distribution feeder, the joint proposed order said.

The company’s confidential construction cost estimate for the Hot Springs Microgrid is reasonable, according to the joint proposed order, which also noted that though it is not clear that the Hot Springs Microgrid is the most cost-effective way to address reliability and service quality issues at Hot Springs, the overall public convenience and necessity would be served by granting the certificate for the solar facility and approving the Hot Springs Microgrid as a pilot project.

The system benefits from the Hot Springs Microgrid are material, but difficult to estimate accurately without real world experience in DEP’s service. The joint proposed order added that DEP would gain valuable experience by operating the Hot Springs Microgrid, and the actual operational data gained from experience, data collection, and analysis would be beneficial in future cost benefit analyses of projects with energy storage.

Among other things, the joint proposed order noted that the anticipated useful life of the Hot Springs Microgrid is expected to be 25 years with anticipated replacement battery cells after year 10, depending on the degradation curves. According to DEP, if commission approval were to be obtained, the limited notice to proceed is expected to be issued in March, with site mobilization to begin in September, and final commissioning in January 2020.

About Corina Rivera-Linares 2807 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 13 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics and education for weekly newspapers and national magazines. She can be reached at corinar@pennwell.com.