Duke Energy to invest $30m in two battery storage facilities
Duke Energy is to invest $30m into two of the biggest battery storage projects in North Carolina in a first for the regulated arm of the utility. The projects signal a culture shift in the region as battery prices continue to fall, indicating increased interest in battery storage among regulated utilities. “That fact that we’ve gone from Duke Energy using old coal-fired power plants in that region in the state, to a mix of gas turbines and energy storage I think is a good sign,” said Stephen Kalland, executive director at the North Carolina Clean Energy Technology Center.
Duke Energy is investing $30 million into the two biggest battery storage projects in North Carolina -- a first for the regulated arm of the Charlotte-based utility.

“We feel the technology has improved, the price has come down, and we think there are some niche applications where battery use makes sense for the regulated utility,” said Duke spokesperson Randy Wheeless. “In a regulated environment, you have to justify these projects to a commission, and usually least cost is an overriding factor there.”

The projects may indicate new interest in storage among regulated utilities, as battery prices continue to fall.

Both of Duke’s projects -- a 9-megawatt project in Asheville and a 4-megawatt project in Hot Springs -- will use lithium-ion technology. While lithium prices are currently spiking, battery prices are bottoming out.

“It’s all about the economics,” said Stephen Kalland, executive director at the North Carolina Clean Energy Technology Center.

Duke said the Asheville storage project will provide real-time grid support services and the Hot Springs project will improve reliability for the community. Down the line, a solar facility may be added in Hot Springs as well.

According to Wheeless, the utility sees battery storage as an economic way to alleviate grid stress in rapidly-growing areas, or improve delivery in remote areas.

Western North Carolina, dotted by the Appalachians, hosts many remote communities where providing service can be more challenging. For example, Duke operates a remote communications tower in Great Smoky Mountains National Park. It runs on a microgrid with solar and a zinc-air battery, a more cost-effective solution than running poles and wires up a mountain.

“Western North Carolina is an ideal spot to use this technology to serve remote areas, or where extra resources are needed to help the existing energy infrastructure,” said Robert Sipes, vice president of Duke’s Western Carolinas Modernization project, in a statement.

Utility-scale storage is growing at a rapid rate. But it's still rare for regulated utilities. According to Ravi Manghani, director of energy storage at GTM Research, only a few dozen regulated utilities have deployed grid-scale storage.

Regulated utilities, excluding public utilities, so far have deployed 35 megawatts of storage capacity. Duke's 9-megawatt storage system will be the largest rate-based project.

“In that sense, it puts Duke in the top ranks,” said Manghani.

However, the $30 million for storage is a relatively small portion of the $1.1 billion the company is devoting to the Western Carolina Modernization project.

“They do have to be commended for investing in these assets,” said Manghani. “But I think from a much broader perspective, it’s going to be just one of the many assets they’re going to invest in.”

Duke joins utilities like Tucson Electric Power, Arizona Public Service, and Southern California Edison that are making storage more central to their services. Duke already has a 36-megawatt storage facility, the Notrees Battery Storage Project, connected to a wind farm in West Texas. That project was developed by Duke's unregulated arm.

“A lot of regulated utilities don’t have them in their territory now, but have seen the promise of battery storage technology and may be looking at projects of their own,” said Wheeless. “Seeing Duke move forward will cause them to look and see how it may benefit them.”

It's also a sign of a real culture shift in the region.

“That fact that we’ve gone from Duke Energy using old coal-fired power plants in that region in the state, to a mix of gas turbines and energy storage I think is a good sign,” said Kalland. “And probably a harbinger of things to come, not just from Duke, but from other utilities.”

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