Reliability – Market
In this proceeding, the AUC approved the application from FortisAlberta Inc. (“Fortis”) to construct and operate a battery energy storage system (the “System”) in Waterton Lakes National Park.
Discussion
The System proposed by Fortis would have a capacity of 1.6 megawatts (“MW”) / 5.2 megawatt-hours (“MWh”). It would be located on the Parks Canada operations compound in Waterton Lakes National Park.
Fortis stated that the proposed System would provide backup to Waterton in the event of a contingency to the existing single distribution feeder. The System would be trickle charged by the distribution feeder under normal conditions. The System would provide electricity only when the local distribution system is islanded from the Alberta Interconnected Electric System (“AIES”).
Fortis estimated that the energy storage system would cost $4,230,000, a portion of which would be externally funded by Alberta Innovates, Emissions Reductions Alberta and Natural Resources Canada. Forits evaluated a wires alternative and estimated the costs of the alternative to be $7,913,000.
The Alberta Electric System Operator (“AESO”) raised concerns regarding the general issue of regulated entities owning energy storage systems. In the AESO’s view it was preferable for energy storage facilities to be owned by unregulated entities that could compete in the market while also providing reliability services to the transmission and distribution system.
AUC Findings
The AUC determined that the issue of regulated entities owning energy storage facilities was broad and complex and beyond the scope if this proceeding. As noted by the AESO, the AUC accepted that the effects of this single System on the markets would be insignificant. The AUC noted that the decision on this application, without resolving the broader issue, was not intended to establish a precedent for similar proposals, or to provide any direction or opinion regarding the broader issues.
The AUC was satisfied that the system would be a minor alteration to Fortis’ electric distribution system and that the requirements of Section 11 of the Hydro and Electric Energy Regulation had been met.
The AUC imposed the following as conditions of the approval of the System:
(a) The System was not to export electric energy to the Alberta Interconnected Electric System;
(b) Fortis was required to obtain AUC approval before making substantive changes to the energy storage system or substantially varying the design specification of the System from what had been stated in this application or what had been approved; and
(c) Fortis was required to obtain AUC approval before making changes to how the System would be used or operated from what was applied for in this proceeding or approved by the AUC.
