Dive Brief:
- Indianapolis Power & Light (IPL) is considering constructing a $25 million battery-based energy storage system (BESS), but is currently weighing tax incentives as to where it will construct the facility.
- The utility would prefer to construct the storage project at its Harding Street generating facility, a coal plant slated to be converted to use gas next year.
- The storage system could be under construction this summer and in operation next year, the Indianapolis Business Journal reported.
Dive Insight:
Details are on the plan are still few, but the Indianapolis Business Journal reports IPL is weighing two options for its planned battery storage system, and the location may come down to real estate tax breaks. The company anticipates a $25 million price tag on the project, with $500,000 going to real estate cost.
IPL officials prefer the Harding Street location, located in Marion County, but are also looking at Morgan County. Marion County is home to Indianapolis proper, while Morgan County is to the Southeast of the city.
The utility filed its integrated resource plan in October of last year, pointing out that "ongoing cost reductions and technology improvements ... continue to improve opportunities for battery based
energy storage systems."
In its plan, IPL described a battery storage project and said it is in the late stages of considering options, including "up to a 20 MW BESS within Indianapolis and MISO regional transmission area which would likely be located within the IPL 138 kV grid. The immediate benefit that the BESS would provide to
customers is fast-response frequency regulation for the grid."
IPL told the Business Journal that the grid currently sends automatic generation control signals to traditional power plants to either increase or decrease their output to keep the system in balance.
"Although this is an adequate way to provide frequency regulation, it is inferior to fast-response batteries which can instantaneously add or remove power to the grid," the utility explained. "Although frequency regulation of a BESS project is the immediate commercial benefit to IPL customers, IPL will also explore and pilot studies on other applications." Those could include ramping, peak shaving, and renewables integration focused on solar.
