Dive Brief:

• Arizona Public Service has issued a request for proposals seeking offers to equip its existing solar plants with battery storage.

• The RFP calls for up to 106 MW of energy storage to be added to its solar plants, part of APS' AZ Solar program.

• The RFP is part of APS' plan to add up to 500 MW of energy storage to its system over the next 15 years.

Dive Insight:

APS says the resources it is soliciting represent one of the largest battery storage projects in the country. The utility says it plans to use the batteries at the solar plants to soak up overproduction of solar energy during the middle of the day and re-distribute it at peak hours.

APS has a significant duck curve problem, spokeswoman Annie DeGraw told Utility Dive. APS' new rate structures took effect in May and include super off-peak rates designed to encourage customers to use power from 10 a.m. to 3 p.m. when there is a lot of cheap solar energy on the system. But "our duck curve problem is way bigger than demand management and resource management" alone can handle, DeGraw said. Batteries are one more way to help manage the problem, she said.

The RFP will also help APS meet the target in its integrated resource plan (IRP): installing 500 MW of energy storage by 2032. APS expects to have 6 MW of batteries installed by year end. The IRP, meanwhile, is "on hold," said DeGraw, but APS is still moving forward with some of the goals of the plan.

In March, the Arizona Corporation Commission (ACC) refused to acknowledge the IRPs filed by APS and Tucson Electric Power. The ACC said the plans put too much reliance on gas-fired generation. The ACC also passed an amendment that requires commission approval for any new gas plant of 150 MW or larger until Jan. 1, 2019. APS' IRP called for about 5,500 MW of new gas plants.

"APS continues to actively consider opportunities to enhance its renewable energy portfolio, both to ensure its compliance with [the state's Renewable Energy Standard] and to meet the needs of its customer base," DeGraw said.

Arizona's Renewable Energy Standard calls for the state's utilities to meet 15% of retail electric sales with renewable resources by 2025. One of the key programs APS uses for solar resources is its AZ Sun Program under which third parties design and build solar plants that APS owns and puts in its ratebase. APS currently has about 210 MW of solar online through the program.

Any of the AZ Sun plants would qualify for pairing with storage under the new RFP, DeGraw said. It is not yet known how many or which plants will be chosen to host the storage facilities, she added.

"At this point, we don't have plans to add more solar plants," DeGraw said, adding that APS, like a lot of other utilities, is looking at "solar 2.0" and trying to find new technologies that "can help round out solar and make it more 24/7." Among those technologies are smart inverters, pre-cooling and grid connected hot water heaters.