Technologies and strategies to integrate storage in power plants18/09/2017 Giacomo Petretto

Enel today 1

Global diversified operator

21. As of 30th June 20172. Presence with operating assets

= Enel presence 2

Enel Group•Capacity: 82.9 GW •Networks: 1.9 mn km•End users: 63.6 mn

North and Central America• Capacity: 2.8 GW

Latin America• Capacity: 19.3 GW • Networks: 0.32 mn km

• End users: 18.0 mn

Iberia• Capacity: 22.7 GW • Networks: 0.32 mn km

• End users: 12.4 mn

Europe and North Africa• Capacity: 9.7 GW • Networks: 0.09 mn km

• End users: 2.8 mn

Italy • Capacity: 27.7 GW • Networks: 1.14 mn km

• End users: 30.4 mn

Sub-Saharan Africa - Asia• Capacity: 0.7 GW

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Introduction

Regulatory trends worldwide reflects greaterattention to energy storage market

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� Regulations are specifically defining energy storage activity , accounting for its peculiarities and to establish a level playing field with other sources

� In-depth analyses and revision of network charges and final consumption leviesTo reflect the actual value and costs of flexibility sources for the network and avoid discrimination against storage (e.g. no netting for self consumers; addressing double payment issues)

� Establishing new system services and revising the design of the existing onesNew fast frequency regulation services to cope with power systems’ reducing inertia (e.g. UK’s EFR; PJM’s Reg-D), and new rules to ensure the widest set of flexibility sources can access ancillary services markets

� Clarifying the frameworks on the stacking of different revenue sourcesTo pull flexibility sources to the market, responding to investors’ call for enhanced certainty of their business models (e.g. modification of UK capacity market rules to clarify its compatibility with the EFR)

� Enhancing clarity on the role of aggregatorsResponding to the need to tap flexibility also from distributed resources, striking the right balance between facilitating independent aggregation and preempting free-riding behaviors

Framework

• Over the last decade, the energy storage system (ESS) has become one of the important components for enhancing power systemperformance and grid reliability

• The ESS can be used to mitigate the voltage unbalance of the electrical networks, frequency control, uninterruptible power supply(UPS), spinning reserves, peak demand shaving, reduce operating costs and so on

• A widespread application of BESS is driven by CAPEX decrease and system performance improvements: BESS does represent nowa remunerative investment for many applications

• Enel GTG intends to develop ESS applications along three main business models: on-plant on network , in isolated system andstand alone

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• Enel GTG has already installed BESS in isolated system(Ventotene and Gran Canaria) and is targeting BESSinstallation:

• On plant in the existing market : Enel coal plant inLitoral (Spain), Civitavecchia (Italy), Ventanilla (Perù);

• Isolated System : Isole Minori (Italy), Canary Island(Spain)

• Stand alone in new market : Californian tenders in US,Tynemouth (UK)

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Energy storage technologies

Lithium ion batteries have been the technology of choice for utility-scale project to date ….

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A lithium-ion battery is a type of rechargeable battery in which lithiumions move from the negative electrode to the positive electrode duringdischarge and back when charging. The organic electrolyte, which allowsfor ionic movement, and the two electrodes are the constituentcomponents of a lithium-ion battery cell.

• High energy density• Variety of types available: There are several types of lithium ion cell

available. This advantage of lithium ion batteries can mean that the right technology can be used for the particular application needed.

• High C-rate • Relatively low self-discharge • Low maintenance requirements

• Limited storage capacity• Limited lifetime, reduction of capacity over time due to

charge/discharge cycles • Need of cooling, which is the most significant part of auxiliary power

needed• Transportation restrictions, especially by air.

14%

17%

23%6%1%

2%

16%

2%

19%� Samsung � NGK � Toshiba� LG Chem � Saft � Tesla� BYD � A123 � Other

Tot Commissioned

capacity @2015: 1,7 GW

The continued decrease in battery price is due to a number of factors, most importantly: technology improvements, manufacturing scale and competition between the major battery manufacturers. Ref. Bloomberg 2016

73% fall in Li-ion pack cost from 2010 to 2016 ($/kWh).

Technology description

Advantages

Disadvantages

Ref. Bloomberg 2015

R&I continue with the goal of improving key perform ance metrics for energy storage systems….

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Key performance Metrics

Cost • Low material and manufacturing cost

• Low integration cost• Low recycling and disposal cost

Reliability • Durable, long life components• Operable under wide range of

conditions• Well defined failure characteristic

and expected life

Efficiency • High coulombic efficiency with low polarization

• Low self-discharge losses• Minimal parasitic loads from

cooling and other functions

Control • Well defined user cases• Effective and well-established

control algorithms

Examples of Start Up and Companies with New Storage Technologies

Innovation is monitoring new technologies to unders tand their advantages, disadvantages and potential a pplicability in business development

Vionx Energy Vanadium Flow Battery

Amber KineticsFlywheel system Vizn

Zinc-Iron Flow Battery

RedFlowZinc-Bromide Flow Battery

UETVanadium Flow Battery

Primus PowerZinc-Bromide Flow Battery

Flow Battery hold significant promise for storage needs in the future and may offer an alternative to lithium tecnology

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Flow batteries are a rechargeable battery using two liquid electrolytes,one positively charged and one negative as the energy carriers. Theelectrolytes are separated using an ion-selective membrane, which undercharging and discharging conditions allows selected ions to pass andcomplete chemical reactions. The electrolyte is stored in separate tanksand is pumped into the battery when required.

• Flexible layout: the energy capacity is a function of the electrolyte volume (amount of liquid electrolyte) and the power a function of the surface area of the electrodes

• Long cycle life : there are no solid –to-solid phase transactions• Low Maintenance requirements• Full state of charge operating range

• Low energy density• Low DC roundtrip efficiency (i.e. around 80% FB vs 97% Li-ion).• Still high investment cost: suitable only for large-scale applications• Charge/discharge asymmetrical profiles• Possible gas emission (H2) during overcharge or overdischarge• Less developed than Li-ion technologies

Future costs of turnkey system*Technology description

Advantages

Disadvantages

*Ref. Bloomberg 2017

Also Amber Kinetics FES could be a valid alternative to lithium ion batteries due to their expected performances

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A flywheel is an energy storage system based on the kinetic energy.During the charging process a motor is used to accelerate a big rotatingmass (flywheel). The energy is stored as the rotational kinetic energy ofthe flywheel. The disc has to remain spinning until energy is requested.During discharging the kinetic energy is extracted by a generator drivenby the inertia of the flywheel resulting in a deceleration of the rotatingmass

• No degradation of capacity over time• Long cycle life • Low Maintenance requirements• Full state of charge operating range• Safe and sustainable solution:

• Future costs curve not comparable to the battery one’s• Requires vaster spaces per MWh• Slower response time than BESS: not adapt to FFR• Lower efficiency than BESS• Only one supplier worldwide

A flywheel capable of four hours’ energy storage duration that could be a validalternative to lithium ion batteries due to their expected performances in termsof cycling , auxiliaries consumption and capacity fade .

Technology description

Advantages

Disadvantages

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Strategies to integrate storage in power plant

Key storage use cases and pursuits

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Litoral PP - Spain

Coal fired PP- ItalyOn-plant on network

El Hierro island - Spain

Small Islands - ItalyIsolated system

Efficiency increase is achieved by keeping generator always at max power or switched off, while storage follows the load and provide regulation.

Spinning reserve power plant may sell spinning reserve, while storage will provide frequency regulation.

Ramp improvement storage provides power and energy to support power plant performance.

Imbalance compensation charging/discharging storage and keeping the required generation profile. Case is attractive when imbalance prices are very high.

Application PerimeterFrequency regulation (primary, secondary, tertiary) service of charging/discharging storage stand alone or jointly with a power plant following frequency of TSO signal

On-plant on network

On-plant on network

On-plant on network

Project under evaluation

Litoral PP - Spain

Coal fired PP- Italy

Coal fired PP- Italy

Coal fired PP- Italy

How to identify storage business case

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Applications and services Multiple services business case

Storage systems generate greater value if used to supply multiple services and applications , particularly if they are enabled by flexible frameworks

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Global Thermal Generation Energy Storage plants

• Creating a dispatchable peaking resource in the island grid to achieve apeak- load reduction on a distribution feeder;

• Demonstrating that substation storage can simultaneously mitigatevoltage-level fluctuations as well as enable load shifting;

• Assess storage technology capabilities to integrate CT fleet in the islandsfor peaking services

• Stand-alone storage in La Aldea de San Nicolas, near to existingdesalination plant �1MW/3MWh lithium ion battery integrated in thegrid substation

Gran Canaria Project

Enel BESS on islands

• Validated system on peak shaving and load levelling operational modes

• Voltage and Reactive contribution to dips

• Capability to participate in primary and secondary regulation

• Efficiency around 84%, with an aproximate 75% of monthly operationaleffciency

Target

Solution

Achieved results

La Palma Project

• Integrate fast response storage technologies in a diesel powerstation to respond to generation failures (failure of one engine) thatmay cause load shedding events (due to slow dynamics) andbalckouts

• Storage integrated in Los Guinchoes Diesel power station �

4MW/5 sec supercapacitor integrated with power plant able totake or provide 4MW with a ramp-up time of approximately 200ms

• Load shedding significantly reduced (see figure).

• No black-out incurred since December 2013

Enel BESS on islands

Target

Solution

Achieved results

Ventotene BESS Project

Integration of 300kW/600kWh storage system with diesel powerstation to:• Supply 24hrs/day 7 days/week energy to the all off-grid island• Guarantee a more efficient operation of diesel engins (up to 20%

fuel savings )• Maintain reliability , prevent outages, increase power quality• Minimize O&M costs and increase lifetime of conventional assets

• Population: Winter ~150 / Summer ~1500• Electricity generated by 4 x 480kW diesel engines• Distributed PV plant 90kW• Cost of fuel = 3X vs mainland

Enel BESS on islands

• average fuel saving of around 14.7%• operating engines hours saving of about 55.5%• high efficiency range engines operation for 79% of the time• storage able to support individually the island network and

overall loads for 25% of the time .• storage able to guarantee grid stability for 90% of operating time

24%

76%

storage stand alone

storage + diesel

44%

56%

h effettiveh risparmiate

Load following service Engine operating hoursBackground

Solution and Target

Achieved results

El Hierro BESS Project

Battery system (1MW/3MWh) reallocation from GRANCANARIA to EL HIERRO (Llanos Blancos PP) to:

• Increase the stabilization of the Island Frequency

• Optimize operation and reduce stress on diesel units besides improving electrical supply quality

• Provide black start capabilities to Llanos Blancos and reduce potential black outs

Following commissioning of the hydro-wind plant of Goronadel Viento in El Hierro island, the primary regulation has beengreatly affected by the variability of the wind resource atcertain times, producing incidents in the frequency of theisland and making this system more unstable.

Enel BESS on islands

Background

Solution and Target

Hydro-wind plant of Gorona del Viento

Li-Ion BESS 1MW/3MWh

Litoral BESS Project

20MW/11.7MWh Li-ion battery (COD June 2018) to improve Endesa´s overall fleet performance and efficiency in providing Secondary Regulation service.

The BESS will provide secondary part of the Frequency services normally provided by thermal plants allowing to:

� optimize the production of thermal plants (extended power range )

� increase the overall fleet flexibility in ramp up/down response (less penalties)

� reduce O&M plant costs and increase lifetime of the PP (the fast responsecapability of a BESS reduces fluctuations requirements in boilrs and steamturbines of PP)

• The secondary regulation service is provided by each agent using its available fleet, i.e. the service is not provided by each single power plant but by the entire fleet as a whole.

• Litoral (1.1GW coal fired power plant) usually offers 40MW of secondary band reserve. To provide this service, the power plant needs to be working in the 285-490 MW range.

Enel BESS on plant on network

Background

Solution and Target

Litoral restrictions to provide secondary band servi ce

Extended power range of Litoral PP

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Thank you