Home News Mexico Gets Its First Grid-Scale Battery—at a Car Factory

Mexico Gets Its First Grid-Scale Battery—at a Car Factory

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Mexico energy police have been developing a power storage strategy to balance from the country’s current surge in solar power plants. What is apparently the very first and biggest battery to come online, though, does something else completely.

The 12-megawatt/12-megawatt-hour device changed on in October to deliver strength and power quality in a 130-megawatt microgrid serving an automotive factory campus in Monterrey. The system manages spinning reserve, voltage support and frequency for the completely self-contained electrical system.

Seven Wartsila gasoline engines function as workhorses of the microgrid. Developer Arroyo Energy decided that, if one of those engines tripped, it could trigger a density or reliability problem. To protect against that tumultuous scenario, the company hired storage developer Plus Power to fast-track shipping of a battery, which can react in milliseconds.

&ldquoWe needed something that could respond extremely quickly, as though it were another engine, in case one moved offline,” said Matt Ginzberg, principal at Arroyo. “If we blow it, then the whole production campus goes . ”

An outage would have significant costs for the industrial client, who Ginzberg declined to name.

“If you’re halfway through painting a vehicle and the electricity goes away, now what? Or you’re halfway through a weld along with the electricity goes away, now what? ” said Brandon Keefe, co-founder of Plus Power.

This is the very first business operation for the boutique large storage development outfit, which also includes Robert Rudd, previously Tesla’s utility revenue manager for electricity storage, and Alex Fraenkel, who assembled the storage system in NextEra Energy Resources. Keefe formerly developed utility-scale storage partnership with Enel in Sovereign Energy Storage.

They procured batteries out of Powin Energy and inverters from SMA, and built a custom control to interface with the generators.

Since the project doesn’t link to the national grid, the developers could bypass some of these interconnection steps a grid-tied system could need. Nonetheless, the development cycle highlighted how quickly battery technologies can enter service in contrast to more conventional grid equipment. 

“I didn’t even know exactly what a battery was April of this year, and in October I had a working battery,” Ginzberg said. “It became apparent how competitive the pricing has become and what a factor storage will play going forward. In a word, I have been indoctrinated.”

The battery chiefly plays an insurance policy role, letting the motors to run at higher rates and with higher efficiency. However, it activates daily to deliver electricity quality, Ginzberg mentioned.

Behind-the-meter applications aren’t the storage use case most prominently discussed for Mexico. That might be a kind of solar energy integration, such as in the distant Baja Peninsula, where a planned storage tank could be a much less costly way to consume new solar generation than thousands of kilometers of transmission line.

Mexico's renewables build-out is underway, and there happen to be areas where storage can play a valuable role on the transmission and distribution grid, said analyst Manan Parikh, who covers Latin American clean energy markets in Wood Mackenzie. The challenge is that there isn't nevertheless a clear mechanism for developing and paying for such storage jobs.

“Commercial and industrial is probably where the real opportunity is right now,” he said. “That's where the money is.”

Industrial clients can move more quickly to purchase storage for their very own electrical reliability, in addition to possible cost savings. Tariffs have climbed substantially for large industrials in the past couple of years, Parikh mentioned, spurring some to create their own energy. 

These conditions could result in a healthy C&I storage in contrast to this U.S, where it’s a tough sell in all but a couple of markets.

“With the change of the tariffs in Mexico, the economics will likely be more important to more people,”” Keefe said. “I believe you will understand that a C&I marketplace coming very quickly. ”

One project doesn’t create a trend, and Arroyo itself is a atypical buyer of storage. It's private equity firm focused on energy investments in the Americas, with all at-home commodities experience to add value to the resources it invests in.

Private equity capital supplies a workaround to the project financing hurdles that frequently block storage prices, especially in new markets. But market activity suggests that there aren't lots of buyers using that sort of money that are comfy with electricity storage in this stage in time.

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