February 11, 2020 – Homer Electric Association, Inc. (HEA) continues to move forward with the purchase and installation of the Battery Energy Storage System (BESS). HEA’s design contractor, Power Engineers, has started working on site layout and design for the BESS that will be located at the Soldotna Generation Plant located at the corner of the Sterling Highway and Boundary Road.
The BESS will increase grid stability, electric power reliability and system efficiency for its members. The BESS will be capable of storing 93 Megawatt hours (MWh) of electrical power that can be delivered to the grid at a rate of 46.5 Megawatts (MWs) per hour. The BESS will allow HEA to meet its reliability requirements without having to burn additional fuel. It costs HEA approximately $24,000 a day to supply required reserves when islanded, or not being connected, to the rest of the Railbelt grid. In 2019, HEA was islanded for 176 days (approximately 5.8 months) due to transmission line maintenance and the Swan Lake Fire event. The addition of the BESS will result in greater system efficiencies, lower greenhouse gas production, and reduced power outages.
The BESS also provides a great side benefit of opening the door to renewable intermittent energy projects that would have otherwise stretched current thermal generation assets. The BESS project is expected to be in service in the Fall of 2021.
The cost for this project is estimated at $38 million. The BESS will be paid for with debt financing and patronage capital. The financial impact, both costs and savings, will most likely not be seen in the rates until 2022. The specific impact will vary based on several factors including fuel prices, frequency/duration of islanding events, and sales of spinning reserves when not islanded.
HEA is actively pursuing funding sources, grants and legislative funding through programs like the Capital Project Submission and Information System (CAPSIS) to aid in funding this project for our members. For additional information contact Bruce Shelley at (907) 283-2324.