The smallest county in southern California, Orange County is the state’s third-most populous—and the second most densely populated, with slightly more than 3 million people squeezed into less than 950 mostly suburban square-miles.
With an average annual temperature of 68°F, Orange County can be hot. Because of the heat, air conditioning use has created so much demand for power that Southern California Edison (SCE) was faced with the possibility of having to build a substation just to provide enough electricity to keep residents cool.
“They only needed it because Orange County used too much electricity at mid-day,” states Mike Hopkins, Ice Energy CEO. “Air conditioning is the biggest problem.”
To avoid the cost of building new infrastructure, SCE came up with an innovative solution.
Ice Energy, a provider of distributed ice battery storage solutions, in partnership with NRG Energy Inc., an energy services company based in Houston that offered financing for the capital costs on the project, joined together in a contract with SCE to deliver 25.6 MW of power by installing Ice Bear 30 systems on qualifying commercial and industrial buildings.
“This will solve grid problems and eliminate the need for a new substation and power plant,” insists Hopkins. It will also reduce CO2 emissions by up to 200,000 tons, due to decreasing the need to run air conditioners and the power plant. Moving some of the demand to off-peak also lowers costs.
The Ice Bear 30 has been available for 8 years to customers with commercial and industrial air conditioning package units, which Hopkins says have “the most intensive use of electricity.” They work like an air conditioner, with a compressor to freeze tanks of water and a heat exchanger, and they are physically connected to the air conditioner. “They’re connected electronically. They cool without electricity, so the customers can turn off the air conditioner during peak hours and save electricity.”
They work by letting the ice melt. A low-wattage pump then pumps the cooled water through the heat exchanger to the air conditioner fan. Each Ice Bear is connected to two 5-ton AC units and can provide 3 to 4 hours of cooling.
The system requires less than 5% of the electricity used by an air conditioner, according to Hopkins. Some of the savings comes from freezing water “whenever it makes the most sense,” explains Hopkins, and then storing the ice and using it, again, whenever it makes the most sense, in order to eliminate the need for electricity to create cooling.
After freezing water when demand for power is low, Ice Bears use the energy stored in ice to cool buildings during peak hours without using power-intensive conventional AC compressors, Hopkins elaborates. Air conditioning units that are equipped with Ice Bears consume up to 95% less electricity during peak hours, reducing air conditioning bills by up to 40%.
Approximately 1,800 Ice Energy behind-the-meter ice batteries, constituting the world’s largest deployment, will be distributed on a first-come, first-served basis to qualified commercial and industrial customers. The chosen customers must have package AC units on their buildings and will be selected according to which part of the grid they reside in.
The Ice Bears are being provided free of charge. “SoCal Edison decides where [to place the units] and provides them to customers for free,” says Hopkins. The utility company will maintain the units and control them for the 20 years of the contract. “The utility decides when to make ice and when to melt it to eliminate load.”
Installed by an air conditioning service company using HVAC parts, Hopkins says that the Ice Bears are easy to install and maintain because they use the same equipment and are the same size as an AC unit.
Once installed, the units will provide a total of up to 25.6 MW of peak storage capacity to SCE under a 20-year Power Purchase Agreement (PPA), one of the largest procurements ever undertaken by an American utility.
Every few years, utility companies go to the public regulator with plans to meet new needs and ask permission to buy power. “In 2013, the utilities wanted to procure 1,300 MW in new capacity,” recalls Hopkins. “Due to the law, they had to revise their plan; that’s why part of the procurement is an energy strategy.”
In April 2015, the California Public Utilities refined policies and program details in regard to approving utilities’ applications. In addition to the use of renewables, this rulemaking also considers recommendations from the California Energy Storage Roadmap that set policy regarding the procurement of viable and cost-effective energy storage systems and targets.
Ice Bears will be deployed on a scheduled basis over the four years of the contract, starting in June, to approximately 600 buildings. “We’ll deploy 2 MW per calendar quarter,” reveals Hopkins. “In 12 months, we expect to be fully subscribed.”
The primary goal of the project is to avoid the need for new traditional infrastructure, Hopkins notes, and also to “enable renewable development and get away from fossil fuels and improve the environment.”
But, he adds, it’s a cost-based solution. Behind-the-meter ice battery storage for HVAC systems provides the lowest cost of energy storage currently available. Because of the low cost, SCE not only ordered enough units to procure the minimum amount of storage, the utility bought five times that number.
Ice Bears are clean, cost-effective, and capable of delivering peak capacity to the grid while reducing cooling costs for businesses. In addition to lowering customers’ electric bills, use of the Ice Bears will generate an extension of the life of their HVAC systems. Another benefit expected over the 20-year PPA is the reduction of CO2 emissions by up to 200,000 tons.
Ice Energy’s goals are to deliver on-time and on-budget and to ensure the Ice Bears work correctly. Ice Bears are field-proven and reliable. There are 1,000 in operation, most of which were purchased by utility companies and provided free where there are grid problems, Hopkins points out.
The biggest challenge so far has been waiting. The project is just beginning, despite the contract having been signed in early 2015. Hopkins says it took one year for the California Utility Commission to review and approve the contract, the largest one in the world for an ice-based energy storage solution. “The benefit of that delay is that we had a lot of time to plan.”
Beyond Orange County
As a leading energy storage provider for the grid, Ice Energy has extensive experience delivering behind-the-meter ice battery storage for HVAC systems in commercial and industrial applications. But now they are expanding by introducing two new residential systems this year that completely replace the air conditioner and by venturing into commercial refrigeration. “We are using this technology to provide energy storage for refrigeration and cooling,” says Hopkins. “Glycol brings the freezing point lower, making it useful for display cases in retail stores.”
The other part of this project addresses SCE customers not participating in this procurement program by allowing them to take advantage of rebate programs, such as the Self-Generation Incentive Program, to upgrade their air conditioning units and install Ice Bears with little or no upfront investment. “Customers with older AC units get new ones at a fraction of the cost,” advises Hopkins, “so they can be more efficient.”