Managing Energy Storage Systems

Storage Asset Management: Optimizing BESS Operations | Solarplaza Webinar

Estimated read time: 1:20

Summary

This insightful Solarplaza webinar delves into the intricacies of Battery Energy Storage Systems (BESS) and their evolving role in renewable energy integration. Experts from industry-leading companies discuss the challenges and potentials of optimizing BESS operations, touching on crucial aspects such as warranty management, technological innovations, and operational coordination among various stakeholders. The conversation highlights the need for robust data management and standardized protocols to ensure efficient energy dispatch and long-term asset reliability.

Highlights

Lizette Baus introduces the solar and storage asset management webinar with an expert panel ready to discuss hot topics 🌞.
Panelists emphasize the importance of data management in optimizing Battery Energy Storage Systems (BESS) operations 📊.
Ken Kim discusses the integral role of OEMs in risk management and technology provision for BESS 🤓.
Stephanie Padgett highlights the dynamic nature of battery storage contracts due to evolving market needs ⚙️.
Steve Haniwalt advocates for standardized data approaches to improve BESS efficiency across different assets 🔄.

Key Takeaways

BESS technology is evolving alongside its business models, requiring flexible and future-proof contracts 🤝.
Warranty management for BESS is crucial due to complex interactions and the potential economic impacts 📜.
Standardization of data communication and management is needed to harmonize operations and maximize efficiency 🚀.
Collaboration among providers, OEMs, and service operators is essential for effective BESS maintenance and dispatch 💪.
Data-driven decisions and real-time feedback loops can significantly enhance BESS performance and market adaptability 🔄.

Overview

The Solarplaza webinar, focusing on storage asset management, brought together industry experts to explore the complexities of battery energy storage systems (BESS). The discussion started with an overview of Solarplaza's role in organizing such insightful events and quickly moved into the nitty-gritty of BESS operations and management. Lizette Baus set the stage by introducing panelists from leading companies who delved into their respective areas of expertise.

A central theme throughout the session was the pressing need for precise data collection and analysis to optimize BESS performance. Steve Haniwalt and other panelists underscored the importance of standardized communication protocols for data management, which would help mitigate risks associated with asset operations. Ken Kim brought to light how OEMs can contribute to reducing technological and operational risks by providing robust warranties and innovative solutions.

The discussion touched on the evolving nature of business models for BESS, with the industry gradually embracing more holistic and collaborative approaches. Stephanie Padgett and others highlighted the necessity of incorporating various stakeholders in decision-making processes to ensure effective asset management and flexibility. As the session concluded, it was evident that collaboration, data-driven strategies, and standardized protocols would be pivotal in advancing the BESS and renewable energy landscape.

Chapters

00:00 - 01:30: Introduction and Welcome The chapter introduces the event and the speaker, Lizette Baus, from Solar Plaza. It provides a warm welcome to the webinar on storage asset management and briefly introduces the expert panel. Lizette explains the role of Solar Plaza as a global conference organizer, highlighting their solar asset management events, specifically the eighth edition of Solar Asset Management North America.
01:30 - 08:00: Panelist Introductions In this chapter, the introduction is made for a panel discussion. It is noted that while events are currently being held virtually due to circumstances, there are plans for an in-person event at the end of October. The chapter emphasizes the availability of such virtual gatherings as an opportunity to engage, share ideas, and learn. The setting is for a session that will discuss a trending topic among four expert speakers, highlighting the complexity and the unresolved questions surrounding the topic.
08:00 - 14:30: Stephanie on BESS and Contractual Challenges The chapter titled 'Stephanie on BESS and Contractual Challenges' explores the thoughts shared on the topic of storage asset management. The session is recorded, allowing participants to catch up on missed parts if necessary. Participants are encouraged to engage by sharing their questions in the provided drop-down box. At the end of the discussion, the moderator will incorporate these questions to enrich the conversation. Emphasis is placed on time management due to the limited one-hour timeframe allocated for this pertinent topic.
14:30 - 22:00: Ken on OEM Role and Risks The chapter begins with an introduction by Michael Eiman, the managing director of Origin Services, who is moderating the session. The focus of the webinar is on storage technologies and their evolution, featuring several experts discussing both contractual and technical perspectives.
22:00 - 27:00: Steve on Data and Operational Complexity The chapter begins with Michael Lyman, the managing director for Origin Services, introducing himself as the moderator for the panel discussion. He briefly outlines the structure of the webinar, noting that the last 15 minutes will be dedicated to questions from the audience. Michael encourages participants to submit their questions, which he will present to the panel later. The chapter sets the stage for a discussion on data and operational complexity, with Stephanie being the first panelist expected to speak.
27:00 - 34:00: Stephanie and Steve on Integration and Business Models Stephanie Padgett, a seasoned professional with 20 years in the power industry, shares her experience. She has spent over a decade supporting traditional power plants with ABB and GE. Subsequently, she transitioned into the solar sector, leading First Solar's operations and maintenance (O&M) initiatives in the third-party O&M space.
34:00 - 41:00: Future of BESS and Technology Evolution The chapter explores the career progression of an individual from managing large utility scale solar projects to overseeing community solar initiatives. At Nautilus Solar, they lead the asset management and operations and maintenance team. Currently, they direct the distributed infrastructure and renewable strategy for NAES, a prominent power generation service provider. The chapter concludes with an introduction to NAES, describing it as an energy manager responsible for supporting over 50 gigawatts of energy generation.
41:00 - 54:00: Panel Discussion on Challenges and Opportunities The chapter titled 'Panel Discussion on Challenges and Opportunities' begins with various participants introducing themselves and their roles: a scheduling coordinator, a balancing authority, a remote control operator, an asset manager, a technical advisor, and an operations and maintenance (O&M) provider. Following these introductions, Steve Haniwalt, co-founder and executive vice president at Power Factors, continues the discussion, highlighting that Power Factors provides real-time asset management solutions. The panel discusses varying challenges and opportunities within the energy sector.
54:00 - 61:00: Q&A Session The chapter 'Q&A Session' features a discussion on performance management software for renewable power owners and operators worldwide. A participant named Mike, whose background includes 17 years in renewable power and a recent position at Sun Power, introduces himself. Ken Kim is another participant in the discussion. Their conversation focuses on their experiences and insights within the renewable energy sector.
61:00 - 62:00: Closing Remarks In the closing remarks, the Vice President of Technology and Equipment Procurement for Origins Energy discusses his career history. He highlights a decade of experience in energy storage and renewables. Before his current role at Origins Energy, he served as Chief Technology Officer at Brain Smith, a company that was acquired by Watzella in 2017. Additionally, he spent time working with Samsung SDI, noting his extensive background in the industry.

Storage Asset Management: Optimizing BESS Operations | Solarplaza Webinar Transcription

00:00 - 00:30 a very good day everyone my name is lizette baus on behalf of solar plaza i'd like to welcome everyone into the room for the webinar on storage asset management as you can see the expert panel is already lined up excited to get going but before we start i'd kindly like to remind you if you don't know solar plaza yet of what solar plaza does and why we're here today so solar plaza is a global conference organizer uh you might know us from our solar asset management events we're hosting the eighth edition of solar asset management north america
00:30 - 01:00 hopefully this year finally again in person at the end of october planned for 26 27th of october and in the run-up to that event we're hosting events like these virtually we still have the opportunity to engage uh share thoughts and also learn so we're very happy that you took the time today to join us for one of these events uh where we're going to discuss a hot topic hearing a lot about it there's also a lot of question marks too and things that are unknown so for that we have these four expert speakers that
01:00 - 01:30 are going to share their thoughts on the topic of storage asset management the session will be recorded so in case you have to drop out i have other urgent methods you'll be able to see it back later in the week and of course we encourage you to share all your questions to the panelists in the drop down box here and at the end of the conversation our moderator of today will take those questions into the conversation so for now that's it i want to get going straight away because we only have one hour uh to discuss such a hot topic with
01:30 - 02:00 so many questions so i'm giving the floor to michael eiman managing director of origin services who is today's moderator and who will guide us through the conversation so mike the floor is yours and enjoy everyone thanks lizette welcome everybody to this uh webinar panel today we're gonna we've got several experts in different areas both from an up from a contractual perspective to a technical perspective who are going to be talking about the ins and outs of sort of storage and how that's evolving as
02:00 - 02:30 lizette said i'm michael lyman i'm the managing director for origin services which is you know that one up there uh and so i'll be moderating today's panel and hopefully we'll be hearing some really insightful stuff from from our other folks here on the panel as a quick reminder the last 15 minutes of the webinar i'll be doing questions from from folks who are out there so i'm i'm looking right down here at my computer and so please go ahead and put your questions in and when we get to that point i'll be jumping over there and and letting the panel address those so starting off i'd like stephanie if
02:30 - 03:00 you'd like to introduce yourself please sure michael hello stephanie padgett welcome to my home um a little bit about myself i've been in the power industry for about 20 years i've supported traditional power plants for over 10 years working with both abb and ge i then got the opportunity to transition into solar where i led for solar's o m push into the third party o m space
03:00 - 03:30 i then moved from large utility scale solar to community solar by leading the asset management and the o m team at nautilus solar and i currently direct the distributed infrastructure and renewable strategy for nays the largest power generation service provider supporting over 50 gigawatts of generation but for those of you that are still asking who is nays um nays is an energy manager
03:30 - 04:00 a scheduling coordinator a balancing authority a remote control operator an asset manager a technical advisor and an o m provider thanks michael thank you stephanie steve you're next yeah thanks thank you mike uh hello everybody my name is steve haniwalt i am co-founder and executive vice president at power factors power factors provides a real-time asset
04:00 - 04:30 performance management software platform for renewable power owners and operators throughout the world and my background is energy my entire career the last 17 years in renewable power and formally with sun power as the global onm vp for five years thanks mike sure ken thanks michael hi everybody my name is ken kim and i'm the
04:30 - 05:00 the vp of technology and an equipment procurement for origins energy um i spent a good decade of my career in energy storage and the renewables prior to coming to georges i was with company called brain smith as a cto which was acquired by watzella back in 2017. and prior to that i was with samsung sdi
05:00 - 05:30 um i was three field strategy group uh that led the creation of energy storage business today at samsung sdi back in 2008. so um you know i'm a bit of an oddball out here today my perspective uh from the energy storage actually comes from more on the front end of actually delivering the system that will last the next 20 to 30 years uh where a lot of my colleagues here today are managing these on the backend so um you know i come from a little bit
05:30 - 06:00 of uh the you know throughout the supply chain from the battery to integrator to now being a developer so those are the topics that i'll be focused on today thanks ken you guys were all uh i don't think you're as complimentary to yourselves as you should have so before i kick off the questions let me tell you what i see on this panel right so ken kem was sought for a specific expertise deep expertise at a technical level and storage and is really
06:00 - 06:30 a deeply knowledgeable uh it's hard to find experts in an area that's emerging and so ken thank you for being on the panel steve you mentioned that you were the co-founder and evp but you didn't mention that it was your brainchild that you created that from the get-go and and that you're a technologist and a visionary in your own right and thank you so much for being here and stephanie when mace was looking to move into solar and they and they needed an expert they pulled you and i think they made a great choice so
06:30 - 07:00 i really appreciate all of you guys being on this panel today you're all deep experts and we're going to learn a lot but we're going to start with stephanie so stephanie you know when i think about battery energy storage it's it's an evolving uh technology and it's a but it's not just an evolving technology people think of that in terms of the batteries evolving but it's also an evolving business model and it's not just going to evolve on the front end but over the 30-year life of these projects that these things are attached to whether it's standalone whether it's with solar whether it's connected to some other form of power or
07:00 - 07:30 thermal generation those business models are going to evolve during the lifetime of those of those installations so from it really presents a specific contractual challenge to sort of contemplate that and understand and make sure that you're putting contracts together at the front end that both acknowledge that flexibility and also enable owners and operators and everybody to take really take advantage of that technology as as it as it evolves in the marketplace so
07:30 - 08:00 i think nace is ideally situated being across so many different types of power i mean tell me how do you approach this yeah yeah and it's very different too i would say battery storage is unique when you think about contracting and how we're going to be utilizing the asset and what we're going to need to service the asset um you know but before i jump into that can i can i just get a little personal for a second i just want to say hi uh to all my industries friends um i wish i could see you on the panel
08:00 - 08:30 or see you on this webex um but of course i can't uh it's been too long since i've seen you in person and i really hope to get to see you soon hopefully at solar plaza um you know we're in a very unique time today and i've always been so inspired by this group of professionals and today's opportunity to explore how our industry will continue to evolve really gets me excited there's so much happening in our industry and we've always referred to the solar coaster uh but
08:30 - 09:00 buckle up because it's about to get so crazy uh we've got the administration's focus on 100 clean energy by 2035. we have the american jobs plan consideration of the extension of the itc the proposal of an itc for battery storage the conversion of the itc to direct pay and last week ferc issued a policy clarifying that regional grid operators will incorporate a carbon price uh things are changing to make all this
09:00 - 09:30 happen we need all of us and more uh we're so lucky to be in the best industry and i think all of you for what you do as well okay so sorry about that back to the question um yeah and i'm gonna go down a rabbit hole because you know when i when i think of service and i think of going and presenting um you know i don't normally start uh with warranty management um but i guess that's changing too uh and so let me start with how did we get here
09:30 - 10:00 uh ferc ferc order 841 creates a clear framework for storage resources to operate in all wholesale electric markets and expands the universe of solutions that can compete to meet our electric system needs so thanks to ferc there's new market rules to foster and enhance a participation model for storage and this is evolving in real time so we're seeing the value of storage expand beyond ancillary services which is key when you're thinking about all of these
10:00 - 10:30 contracts so storage is now actively involved in day ahead in real time markets so careful data collection processing analysis in close coordination with the scheduling coordinator is critical to avoid voiding these battery system warranties and seriously compromising the economic life of the asset warranty administration and the preparation of warranty claims by the operator or the asset manager for storage is more complicated uh than
10:30 - 11:00 any other asset in the renewable space at least in my opinion um the management of this warranty operating envelope will impact the project's revenue opportunities we're going to want to use this storage system as dispatchable generation dispatchable load and as regulation resources and we want to do all of this at the same time but still maintain the
11:00 - 11:30 integrity of the equipment asset managers service providers will have to continuously evaluate the market to see if the operating strategy needs to be updated and how it will impact the warranties also layering all these warranties requires a third party perspective to manage and monitor the interconnectivity of these warranties along with the contracts um so that's you know that's what i really think about right now and understanding how we're going to manage
11:30 - 12:00 um these contracts but then you also want to think about what about the scope right like the scope has to be uh critical at least when you're looking at these you know how we're going to operate uh these these assets for the life right so what i'm seeing um is that oems want to take on scheduled preventative maintenance for the system so they want to contract with them directly and and what we'll learn very quickly is that most of that scope is being
12:00 - 12:30 subcontracted back to the service providers so these oems are not going to set up local labor support with a quick response the system will demand once we have significant deployment of storage it's just not sustainable just like the solar industry learned nays is working with oems to help support their site maintenance scope the o m provider and the oem are going to need to work hand in hand to support these systems efficiently and effectively
12:30 - 13:00 um and then the other part of the contract that i'm seeing is a lot more um a lot more need for substation services as part of the storage project so this means um you know more need for medium voltage high voltage transformer circuit breakers switch gears substation equipment to be maintained by your service provider um so does it make sense to have another party involved to support that scope or can you rely on your storage
13:00 - 13:30 o m provider um and then i'd say you know the o m challenge and we'll get into lots of other details but the o m challenge of these systems in the short term is the amount of participants that will be involved in site maintenance until we get more comfortable with the modern solar model which is utilizing your service provider for all scheduled maintenance activity and look to the oems for specific support my guess is this will happen much
13:30 - 14:00 quicker for storage than it did for solar because of the focus on meeting the nation's clean energy goals which requires accelerated growth so i'm excited to hear what everyone else has to say so it occurs to me that in order for the oems to be able to support that activity right you have to have enough financial incentive in the contracts right and ppa prices continuing to put pressure on it is going to continue to squeeze those contracts so you know ken from
14:00 - 14:30 your perspective what do the oems need to be providing as a package both in from a technology perspective so that they can connect out to data aggregation platforms but also from from a service and response time warranty as stephanie was talking about to sort of contemplate the fact that it's fine if you want to pull it all in house but when you have a response time and you're you're operating as a spinning reserve as a higher and higher percentage of the
14:30 - 15:00 grid how do you how do you actually do that and ensure that you can respond in a timely manner when you're you're dealing across you know big geographic regions so what do the oems need to give what do they need how do they need to come forward here in the marketplace yeah i think that um the risk of deploying an essa like this uh there are there are many that you can bucket into like technology risk and the market risk as financial risk there's regulation or you know regulatory risks
15:00 - 15:30 that the number of risks are sort of spread across this spectrum of the stakeholders and i think that really the key is putting the right ownership of those risk on the people who actually have control over that so when we look at all these other risks that are inherent in these projects and to some degree all of us are in the business of taking risk so we we create this um you know asset then we put this deploy this asset to to uh create revenue stream and based on
15:30 - 16:00 the return and the and the and the risk that that's inherent in that project that's how we get paid so we're really in the business of managing the risk of some degrees so when you look at what the oem brings the table is they are the ones that are responsible and has more direct control over the technology risks and and and and the the real the the difficulty as as at the moment is that because the industry's so
16:00 - 16:30 so young and and there's such a rapid growth within the industry when still things were not so mature there's a safety issues there's a degradation there's a you know failure of the equipment the availability time all of these you know come in play and you know have them responsible for a certain portion that they are in control and they can be uh responsible for it really is the key um
16:30 - 17:00 i think that the oems and also the way the battery degrades uh with the and how the battery is being used uh all those things really need to be uh understood much better now the tendency of the customer the reason that these solution becomes very expensive is when we really don't understand technology and when we think about how the market is evolving going forward and we want to future proof everything is you're going to get an expensive
17:00 - 17:30 system and yet um you know there are certain uh financial targets all these asset has submitted right so that balance uh you know is really the key and from uh contracting perspective every day that i what i struggle with is you know where do i find that balance between the risk um and um and the financial return what i mean by is that you know i have my personal belief is that anything that you know reasonable
17:30 - 18:00 request uh requirements can be met with a technology and a good design and even when somebody's aggressive and most of this aggressive can be addressed with technology changes or technology building you know you can over build things and you could have redundant systems for example but these all come at cost and so how do you optimize the system uh yet be able to deliver to the requirement and how do we make so that the customers
18:00 - 18:30 understand the technology and ask for the requirement that really matters on in their project so that that balance is very important um in my opinion do you think do you think the oems out there are ready because when you say risk i hear like it get translated in my brain into dollars that's how it comes through my filter right and so do you think the oems are really ready to step up and and to manage a lot of those risks like contractually
18:30 - 19:00 you know commit uh to do those on behalf of owners and operators and everybody else yeah so uh to the extent that they are responsible for uh they try to manage that risk and so the better battery your ways will come and give you an warranty for next you know 10 20 years whatever you want to buy from these guys uh with the capacity um [Music] requirements to to meet a certain level of capacity the battery with segregation um but they will put all kind of conditions to make
19:00 - 19:30 to protect themselves for example uh the c rate has to be certain rate and 08 is not a a so it's pretty well understood from the beginning of the project because you're pretty much kept by the the you know the power level of inverter right so we know that pretty much up front and what the maximum series is going to be uh but things are like like uh you know the the temperature you know the ambient temperature in which the batteries are operated uh the the average state of charge
19:30 - 20:00 that will risk the battery is resting or even the depth of discharge you know if you're going from 100 all the way down to zero percent it is a lot more punishing for the battery than trying to use the middle range you know around 50 soc and going up and down in that region so all of this has to be understood so what the battery companies will do is try to get as close as you can to the use cases that you have and characterize the duty cycle
20:00 - 20:30 to be able to put the warranty around you know each of the projects and so what's what what's kind of different from solar where solar you know this objective is put as much energy as you can to the grid uh is uh is this the energy story has many many different uh applications with the different objectives that all run kind of differently and you know how do you optimize and some some of the applications you might care about dollar for kilowatt
20:30 - 21:00 um some you may be downloadable to lower hour is more important and others maybe a dollar for cycle is more important so understanding the use cases and and marrying that to uh the way you weren't you know is kind of where where things are today but um there are a lot of uncertainties in the regulatory because the rules change so how do you future proof so if you want to do that then you have to build a system that you not only do aba but now
21:00 - 21:30 you have to be able to uh to assist build a system that can do a and b and again you know it equals to to the cost so again um so any decisions that you make in optimization and requirement is really trade up against your financial disease so almost everything that i do actually end up being financial decision at the end of the day it's how much risk is is good you know what is availability time how do you calculate that you calculate it in in annual basis or monthly basis all this has an implication to how you
21:30 - 22:00 design the systems and um and also in the back end how you use uh create a service contract to be able to get to 98 availability 99 so what does that look like for your spare parts program what does it look like you're stepping on site or in the region we have to respond quickly so all these things are really the trade-off is to the cost so really the key for for us is is to understand the customer needs and and try to come up with the right
22:00 - 22:30 balance the trade-off uh between their priorities and objectives and what the technology got actually delivered look it's it's a technology i mean renewables as a whole has a ton of promise right and the people on this panel and the people listening to this panel have the commitment to to deliver that promise right uh but it's i'm not sure everybody knows exactly what that is i mean when you think about all the ancillary services voltage regulation frequency regulation reactive
22:30 - 23:00 power you think of merchant markets where you know the value of that power at different times a day is going to have different meanings from a dollar perspective and from an operational perspective to the grids of the different isos and that how do you how do you really get enough data in real time out of those systems to meet all those different use cases because i look at the complexity that that that that sort of suggests that we need
23:00 - 23:30 to get to and we're nowhere near there so you know steve i know you know this is coming your way how do we how do we how do we get there from where we are because the battery systems particularly combined with solar have so much potential but integrating that data so that you can act on it in a real-time way to optimize that site and it's more than just the uptime right it's really about the right power at the right time to financially deliver on obligations for the owners and deliver on
23:30 - 24:00 obligations to the operators but but how is power factors attacking that how does it need to be done and what needs to happen because frankly today that part of it is the scariest part to me yeah i know i agree with you mike and i also agree with uh with ken and stephanie when you first start thinking about a battery you go wow this is really simple it's a little cell and then put these cells together and make a module then you make the modules into a rack but you know it's not the technical
24:00 - 24:30 complexity it's the operational complexity that we're talking about here that is the real challenge that makes us as stephanie properly said more complex than operating a solar power plant and as ken said you know you take the wind you take the sun you try and convert as much of that into productive energy and and you and you you got your product but that's not how a battery system works so like any other asset or energy asset the bess system needs real time
24:30 - 25:00 in historical operating data collected at high frequencies and high volumes you need to pull this data in you need to aggregate it you need to normalize it you need to cleanse it and then you need to really understand uh and characterize its current economic performance its current reliability and then you need to back cast that into your what if models so the asset managers and the scheduling coordinators they need to be constantly i'm talking about throughout the day day ahead week ahead
25:00 - 25:30 they need to be constantly feeding historical operating data back into their what-if tools so that they can fine-tune those input assumptions so the models are reflecting reality because when we start out with a new asset class it's a paper model it's a theoretical performance model it's a theoretical set of input assumptions to what are the operating characteristics the degradation rates
25:30 - 26:00 the uptime the performance so we're starting with a blank slate and data is our friend we need lots of data and we need it to be normalized now how do you normalize something when you don't have standards we don't have communication standards we don't have data standards we don't have reliability standards yet some of them are emerging some of them are being developed in europe and so on but right now if you were to look at oem availability guarantees there's as many
26:00 - 26:30 different definitions and calculations for system up time as there are oems in the market so we need to start developing some sort of standard so when we're talking about availability what are we talking at the cell level at the module at the system level average you know what's the time frame what are events are excusable and what are not excusable so there's a lot of questions we need to answer and frankly you know if you think about what is risk risk
26:30 - 27:00 is really uncertainty how do we address uncertainty with lots of good information so we as an asset performance management platform working with asset managers scheduling coordinators and operators are trying to pump that data back into the system to decrease risk by bringing more knowledge in reality to what these systems can really do
27:00 - 27:30 and be able to operate them in a very flexible way because as our other panelists have said it's not going to be just delivering one product likely over the life of the asset you're going to be shifting you're going to be stacking revenues maybe providing ancillary services here capacity contract there you know frequency control over here and to do that without really damaging the equipment which is not hard to do is
27:30 - 28:00 is not a simple thing to know and our operators need to be equipped with this information or else i have a fear um there's going to be a lot of operations outside of the warranty specification and envelope and there's going to be some warranty claims that are denied and uh people left holding the bag well denying warranty claims and leaving people holding the bag is not new by any stretch in this industry uh i would say somewhat cynically
28:00 - 28:30 but you know it occurs to me steve all that stuff you said is true but operationally when you talk about you know operationalizing that data it falls under different entities today you've got scheduling entities you've got you know operators that are that are monitoring the systems and actually running them or doing the maintenance on site like mace like gorgeous services uh you know and in order to you know effectively manage these
28:30 - 29:00 systems in real time do do those sort of operations need to come together and be in one location do there need to be one platform to do that because today they're they're completely really separate like the market activity doesn't operations activities and this kind of blurs the line and so between you and stephanie i'd kind of like to understand what needs to change there not just from a data perspective but from a structure perspective of the companies right well i'll start off and then pass it to stephanie so um there's two words that i think are
29:00 - 29:30 really important that you're touching on mike uh transparency and visibility and when you look at a bess system you have many players you have the oem who's warranting something a battery then you have the system integrator that's wrapping a warranty around the system in the battery then you have the epc that's wrapping a warranty around the system integrator and the battery and the plant and then you have an o m who's wrapping in guarantees around their services and
29:30 - 30:00 service response so you've got at least four different warranted items and there's going to be lots of fingers to be doing pointing here right so how does one do that unless one is looking at a common set of data with a common platform which again gets back to transparency and visibility so yes we are very big believer that we need to get some standardized communication protocols because in a battery you have a battery management
30:00 - 30:30 system you have an energy management management system you have the actual controller which is doing the economic dispatch the economic control and then you have the device level information that's lots and lots of data more data i would suggest that you would have in a comparable size wind or solar system by a factor of 10 massive quantities of data all of these different stakeholders must be reading from the same sheet of music or else we're going to do
30:30 - 31:00 unwarranted operating maybe not even consciously right the sc is over here in a trading room and they're saying do this do they really know what that physically means to the equipment out there in the field and are they exceeding depth of discharge and throughput and all these other things that the oem says thou shalt not do or are you going to seriously negatively impact the economic life of the assets so i really believe everyone needs a single
31:00 - 31:30 pane of glass looking into the system and seeing the same things so the right operational maintenance and economic dispatch can happen and oh by the way who are going to be the owners well they're owners who already have wind and solar plants primarily in hybrid situations so this is one of many asset classes that needs to be looked at holistically run from a portfolio
31:30 - 32:00 optimization basis not a plant-by-plan basis so yeah i agree with you mike i think that's the right approach that's what we're starting to do with our owners and operators and we see that as kind of the future of how we manage these assets yeah and steve you're really talking about how intertwined the system's actual operational profile is and how it will impact right the cost of the o m of the asset so you know i spent a lot
32:00 - 32:30 of time thinking about you know how do you contract around so much variability of the condition of the equipment you know your fixed fee scope is really going to have to be scrutinized um you know think about uh like we might include the the scope of these events related to this operator um scenario but if you decide to operate this way that's not included i mean we're gonna have to start to figure this out right i mean there's gonna be this this scope is gonna be very dynamic and
32:30 - 33:00 we need to be able to respond that way and then you know we keep talking about the risk but where is the risk of the repair time you know immediate repair of this equipment is so important and you know we're we've got to figure out where we're holding all of these spare parts who's responsible for them um you know it seems that these designs are going to be as modular as possible um but that means you need someone who's really close to the site or on the site
33:00 - 33:30 that can get that part in place and can get out there quickly and that's that's creates a lot of a lot of logistic problems as well what about the the business models themselves are the operators and the qscs or the scheduling entities do they need to sort of meld together can those continue to be separate in a world where you have a market-based dispatchable asset yeah like i mean from my perspective there has to be a lot of engagement
33:30 - 34:00 between those parties right um you know i don't know the answer today but i think we need to be all talking to each other to figure out what is the best way to um address this scope and to make sure that we are creating an optimal you know operational strategy for the assets um i definitely think you have to incorporate all of them right when when when ken is out there putting these contracts together like everyone the oem
34:00 - 34:30 the integrator um you know the developer the o m provider the operator the energy manager all of them need to be part of that conversation you know great i agree um one of the challenges with specific with the battery is that there's this innovation curve that they follow so they you know you got to look at their world map two three years down the line are you really going to have a same sales that you're doing today five six ten years from now
34:30 - 35:00 that you can replace or do you want them to replace with the same old cell uh you know five years down the line and so that this you know you know uh you know operability uh you know issues of being able to maintain this system for 20 years is not a trivial one there's technology horror and there's also a commercial uh barriers where it doesn't make sense for battery companies to stop all their line let's go back to 10 years ago so we can go in and augment these uh
35:00 - 35:30 batteries that were deployed 10 years ago so um you know it's just cost prohibitive and it just doesn't make sense right so now you've got a cell is much better much cheaper and and so how do we leverage that uh and instant design and how you design the the system so that you it could be um maintained over a long period of time but again you know trying to design a system that could withstand the um the time uh
35:30 - 36:00 you know of changes uh it comes at a cost up front upfront cost then and these are the stuff that we need to really understand um and if we had a very standardized battery for example they can plug in you know kind of like what you see in the led asset market in in the uh in the in the automotive industry it doesn't really matter where you buy the battery from as soon as you plug it in and um you know you know it missed your model you know carl's model number it doesn't work it doesn't matter
36:00 - 36:30 you buy from lg or samsung right so this kind of centralizes in the product and also um you know steven you mentioned about the development of the safety standards and the test standards and all these things are kind of evolving you know a good example would be like ua 9450 that would have recently uh you know finalized uh nfpa of 855 for the standard safety sectors the fire standards these are are just beginning to emerge
36:30 - 37:00 so we are moving into positive direction it just takes a little bit of time for industry of you know this magnitude to kind of to pick itself some yourself and get moving in the right direction so ken do you even think it makes sense though to to design systems for you know to be able to handle the variability in the evolving uh market and operational sort of strategies around these beyond 10 years because when i think about like the cost curves on batteries and
37:00 - 37:30 how quickly they're coming down if i'm an asset owner and i'm projecting out when i'm going to replace the system then i'm just going to rip the thing out in 10 years because the the what i'm going to replace it with is going to be a fraction of the cost of what i have today so forget about retooling plants and everything else you know why would i want to pay for variability in a system that's 15 years out when i know between eight and eleven years i'm going to be ripping it out and replacing it for the fraction for a fraction of the cost yeah and and that's a really good question michael and you know i think the answer depends on
37:30 - 38:00 your application so you've got you got these batteries now you know the these oems are willing to give you 10 even 20 year warranty based on what the consumption of the lifecycle of the battery is so they would actually track the throughput of the battery 10 years down the line uh you might still have 70 you know 80 of the capacity left you know you don't want to go and replace this thing because you know it's better it's cheaper you still have a lot of usage left in those batteries but how do you
38:00 - 38:30 how do you get to point where but then you know when it degrades uh you know there is a minimum amount of energy or power output that typically that these ppas are required so how do you stay above those minimum so you do that through the augmentation instead of replacing the whole thing because it's cheaper right so so that the balance has to be there so you do you see a future where sometimes you've got old systems and new systems operating side by side where the old system is now in a simplified operating
38:30 - 39:00 model and the new system has been brought in to sort of address the more complicated uh and evolved market and by the way this this thought occurred to me today so if this actually happens 10 years from now everybody that's out there you heard it here first but what do you think jen i mean do you think that that might happen because you're right 50 70 80 why why get rid of the batteries yeah so so you know one one trend that i'm going i'm beginning to see with a lot of the startup companies that are popping up today and things of
39:00 - 39:30 that nature is really kind of addressed that you know that issue uh you know one of the revisions that uh there's really you know kind of two well there's a lot of designs out there but you put that into two big buckets there's a centralized inverter that has blocks of inverter with lots of strings behind them then there's a string inverter with much smaller blocks that are um kind of working together in parallel to to create you know the power level that's required by the project so uh you know if you look at even a few years ago
39:30 - 40:00 uh you know everybody starts out thinking about streaming voter because has the advantages and oms but everybody almost almost always ends up with century border because of the cost of the project but you will be getting to see that equation change a little bit now with you know more entrance of the other uh product um uh oems that are offering this kind of a solution and i've actually even talked to one recent um uh starter company who wants to make uh you know every battery put put a a
40:00 - 40:30 in a boat on each of the battery on a very small scale and then have all the the current collector on the hd side so it's like almost like an ac battery right so you can just plug in and you could uh i mean that's that's a pretty it's going to be pretty expensive but you know expensive that is probably not going to work out but you know at some point you know it might make sense it's kind of like what you saw the evolution of the the micro inverters in the solar field in some segments it didn't make sense it started to make sense as they scale right so it'll be a long time before you get
40:30 - 41:00 there let's be clear about that but but the technologies are being developed so i'd like to one quick note to everybody out there i don't see any questions coming up yet we're coming on the period where we would answer questions so if you have any please put them in but go ahead steve i was just going to follow up on that i i see things the same way stephanie gave us the holy grail decarbonization of the electric grid how are we going to do that you're not going to do with intermittent variable resources in solar and wind
41:00 - 41:30 you're going to do it with the combination of those and batteries that means batteries will have to be dispatchable and dispatch ability means wear and tear right now what are the dispatchable units that are doing this they're called gas fire peaking turbines how do we get rid of the gas-fired peakers i think you're going to do with batteries and i so i think going back to what ken is saying you're going to see different applications and you're going to have basically sacrificial batteries that are getting beat heck in a peaking
41:30 - 42:00 mode doing dispatch and then you're going to have some bass loaders just providing kind of bass load energy i know that's a weird sound base load and batteries but i think that's what's going to happen and then operators and asset managers and sc's are they're going to be operating each of these for their specific use case but then you have to optimize the whole portfolio together so you have a very complex optimization problem as we've already said where everyone needs access to the data you
42:00 - 42:30 need lots of it you need to be constantly updating your models it's a very exciting feature but it can't be done unless we dispatch the battery i don't see how we're going to decarbonize the grid without it so stephanie steve just made the business model a lot more complicated in that last comment so which brings me back around to the business model you know i we're looking at this at or just i'm sure naeces too do you need to be a qsc as well and go to that last mile
42:30 - 43:00 of commercial dispatch combined with operations given the complexity that's coming down the pipe because of all the stuff ken has been building for sure for sure i mean we're gonna we're gonna do the exact same thing we did for solar right it's like how do we continue to drive cost and i think the way we've been successful in the renewable space is is pulling in scope where it makes sense right can you leverage a single provider in certain areas to be cross-functional
43:00 - 43:30 across multiple different scopes so you might need to pull in your your schedule coordinator and your asset manager your operator right we're gonna have to re-imagine who is the right party to address some of this scope who do you think it is it's a combination of specialists i feel like we're asking more questions than we're answering so who is it who who who has the operational financial hot potato and
43:30 - 44:00 is going to ultimately say we're going to do this right who who do you think that rationally is because it's all about the push-pull of the financial benefit but also the risk right and sometimes you get these these except you know these uh dislocations between who's getting most of the financial gain and who's getting who's taking on most of the risks so how do you put those together what does that structure look like ideally what do you think stephanie i'm giving you i think yeah
44:00 - 44:30 i think we're going to push a lot of that scope to our core service providers right we're going to we're going to look at you know we're going to definitely expand the capabilities um of a traditional service provider and it's going to be an energy manager type role right we're going to see a lot of consolidation between an operator an energy manager and an asset manager in order to really capture the value proposition of these assets and then of course you know we're still going to have to look at if we keep focusing on the operational side but we're still going
44:30 - 45:00 to have to look at you know what's in the field right so we we we still have to create a model where we can service and um these assets in real time um you know and that's a challenge you know staffing these systems creates a real challenge um there's just not enough at least in the model we're talking about today there's not enough on-site work to justify justify manned sites especially when you're going to have multiple participants so i think you're even you need to see a
45:00 - 45:30 consolidation around that as well you know response times are going to be so critical um and so you have to use local labor you have to look at opportunities to combine solar plus storage you know bundle it with um uh you know with your substation bundle it with your your gentile your switch yard you know leverage local labor um to be able to service all of those assets so we're we're definitely gonna get the
45:30 - 46:00 opportunity to continue to expand in this in this service space i don't know about you guys but what i heard was that our contract uh pricing is going up that's what i heard that was that was the summary i got out of what stephanie just said is on the operations side our contract values are going to go up so that's what i'm going to that's what i'm going to stick with from there well listen we don't i don't yet have any questions from the group so i can only assume that either one of two things is happening either we're answering all of their questions before they ask them or they're thinking these people
46:00 - 46:30 don't know what they're talking about i'm gonna go with the first and we're just moving forward so you know steve said something a minute ago that i want to touch on and sort of take he he mentioned you know gas speakers and a lot of your thermal uh plants today which provide the spinning reserves right for our grid so you know i think you know there's a broad argument about whether there should be a goal to eliminate those completely i'm not going to attack that one
46:30 - 47:00 i think that's a whole other conversation and more political than technological but but from our perspective as we as a renewable industry take on more and more obligations of spinning reserves because of batteries we're used to just you know hey it turns on at the beginning of the day we sell it we're out so how does that change our obligations to the grid and what we need to do i mean you know and you know ken jump in and give your viewpoint from the
47:00 - 47:30 technology side but to mature a little bit as an industry if we're really going to become you know part of that part of the industry as an equal player well first of all whether you like it or not it is a policy issue it's a regulatory issue i mean i don't want to go into the whole texas thing but you know reserve margins spinning reserve that comes from the regulators they set a price and then the market fulfills that by
47:30 - 48:00 building capacity so yes we're going to have to build capacity and we're going to have different use cases for this capacity and uh some of it will have a high capacity factor some won't but that's okay that's what happens right now in the traditional fossil industry you have specialized types of units peakers and base load and swing units and so on and so forth we need to replicate that with the solar industry and and excuse me the renewable energy industry and batteries in particular
48:00 - 48:30 and then as we've already said that brings a lot more onus on us to take on that risk and to develop business models that are successful but one of the things that stephanie said and you said also michael is that you know you don't really manage risk without a balance sheet and you can't do that with the small i hate to say it mom paw company they cannot really back up the
48:30 - 49:00 risk with their balance sheet so what i think we're going to see is stephanie alluded to is a lot of consolidation in in the industry local service providers under contract but they're not bearing the risk these larger big entities are going to be bearing the risk and writing the contracts but they're going to need a lot of local service people to do the physical wrench work i see that as kind of the future because if the onus is on us to keep the lights
49:00 - 49:30 on you can't do that and say i'll get there tomorrow or the next day you have to be able to respond immediately to issues so i do have a couple questions that have come through and i we have 10 minutes left so i want to make sure we address those ken the first one i think is is directionally right at you uh it was it was asking they were they were asking why are there so few uh providers in this space do you think there's an opportunity for cni
49:30 - 50:00 best providers and more of them to come along like sort of a you know how do you see the evolution of that from on the manufacturer's side of things yeah are you referring to the integrator or actually the battery guys i think that's something that you need to clarify in your answer the difference between them because most people don't even maybe realize that there is a difference yeah so let me just kind of you know talk about a little bit about you know the the supply chain and there's battery guys that are making these batteries lots of batteries and
50:00 - 50:30 there are plenty of them around the world and a lot of them um are doing very well uh addressing electric vehicle market um and they're ver there are a number of them actually cross over to the energy storage because this is the same format so when you look at guys like something sdi um lg uh cam uh the catls uh the view id of the world they've made that crossover and they they now provide the uh the
50:30 - 51:00 full set of you know both in the av side and and energy storage side um and then there are these integrators who actually don't make those fit sales but they buy these these cells and and then they buy the inverters they put their own software with ems on on top of that and integrate so um you know you've seen a number of those uh integrators pop up uh in an early that's right right around 2010-ish uh green screen started for example 2008
51:00 - 51:30 right and what we saw in the middle of the decade like 2015 16-17 is a bit of a consolidation of these uh startup companies that that started to address you know in the uh um the these this so-called innovators now this is by the way when the green screen was also acquired by whatsilla back in 2017 right so you you know you saw guys like extreme and your knuckles and uh and others that that are just you know demand more on energy
51:30 - 52:00 uh you know one energy uh you know these companies were pretty much bought out by the larger companies so you saw that's one of the consolidation and that's one of the reasons why they're there but um from the battery perspective uh again you know there are a lot of companies but there are a lot of companies that are solely focused on the energy so on the electro-vehicle side and also some of the the companies that are just not bankable so you know bank ability is really the key issue so uh you know what what the as an industry
52:00 - 52:30 what we did was we really grab a tour towards you know the company that was a big balance sheet that can actually finance this and the parent guarantee actually meant something uh like samsung and edges of the world and so um that leaves very you know few options out there today but but those it will change uh more people will come and and more people more company will become more um uh you know a bankable uh but what you're
52:30 - 53:00 also seeing with a particularly electric vehicle uh if you really want to understand what's going on on the battery side you know you can you can't really understand without understanding the battery electric vehicle battery uh supply chain and what you're seeing in the trend in the around the world is that the supply chain becoming closer to their customer so you you've seen most of the batteries being built out of korea china and somewhere in asia they're being shipped all over the world but now you're beginning to see a lot of
53:00 - 53:30 these big mega factories being built in europe also in the united states is beginning to happen so that that whole balance will change and this these changes are not just because of the market demands but also uh political geopolitical risks that's associated with shipping batteries out of china for example um you know the laws that are coming in that in play that's going to make a lot more restrictive and not only restricted but very expensive so so these mitigation for these kind of risks are
53:30 - 54:00 now beginning to happen with companies you see for example lg cam looking for a battery company here in the united states sk has already spent 1.9 billion dollars into the factory in in georgia bypasses all the tariffs bypasses all of the expensive uh shipping um and so so you're going to see these kind of changes uh so but right now that change is just beginning to happen and so there is a very tightness in the supply chain because the
54:00 - 54:30 the the supply has not kept it with the demand of the growth of the industry here in the united states solar plus storage so it's going to be time for a little while but you know i expect that to be resolved within the next 12 18 months thanks so i have another question here you know stephanie both mace and cams jumped into renewables this last year uh you know big you know historically thermal service providers asset management companies
54:30 - 55:00 uh and so when we think of storage in these contexts we often think of them in the context of renewables but frankly storage is not necessarily connected to renewables so one of the questions that came out i think it's an ideal one for you given that context uh and being with and and being with nays is is where does where do best systems need to go to really you know you know make the grid uh better you know to really move us move us forward from a from a grid perspective is it just with renewables do they you know
55:00 - 55:30 where do you see them all needing to be deployed to really evolve our energy infrastructure yeah like i really like the idea of you know these these virtual power plants right so the idea of bundling these with all different types of technology um you know not limiting it around you know wind and solar but really looking at it from a holistic perspective and to be able to mimic what we would traditionally use a gas-fired plant or a combined cycle or something like that
55:30 - 56:00 right so i think there's a definitely an opportunity to look at uh you know the grid as a whole i read a whole article about you know really focusing on um the interconnections of some of these plants that are retiring so bringing in that virtual power plant design into areas like that i think will will serve uh will really help to stabilize the grid be able to offer um you know the the flexibility that we're looking for
56:00 - 56:30 so i do think there's a lot of our opportunity to look at you know how do you utilize battery systems alone and and you know certain specific activity and support of the grid but then how do you bundle it with technology to really help us you know in this energy transition that we're uh we're focused on today so yeah steve you know sort of tagging on to another question from the group do you see data latency as being a
56:30 - 57:00 problem when you when you start thinking of storage as being at interconnect points and you know arbitraging power from the grid to stabilize pricing and stabilize availability across all different forms of power and everything suddenly data latency not just in relation to renewables but becomes a problem right so so tell us a little bit about that it does obviously a 5g should help but when you talk about remote operation center in control the o side of o m uh
57:00 - 57:30 data latency just does not work right it's just it's not acceptable uh because you know we we run on a 60 cycle uh grid here and that means you need rapid rapid response to be able to support frequency control and all so if we cannot depend on it then of course you're going to have to do what the utilities and all do and that's they have hard connects and they have vpns and they don't use the public internet
57:30 - 58:00 for the control side so i don't think that's necessarily the problem the problem i see is back at the remote operations centers where your monitoring application now is becoming an overall uber or supervisory portfolio optimization control system those systems even though there's an air gap to meet you know cyber security issues they need to be much much uh more responsive and latency will not be acceptable because
58:00 - 58:30 now we are needing to you know run economic dispatch and real-time operational control from the brains in central operations out into the plants where the local scada system is doing the local control again there's ways around this it's more costly you use you know traditional means but i'm hoping that uh with some of the advances in the internet and 5g service and reliability we don't
58:30 - 59:00 have to go to those more expensive t1 and vpn you know requirements so final question and i think it's an interesting one uh came from the outside is you know basically where do we put our money if we're going to put storage someplace where should we put it as a developer like where is the place where are the locations that we should really be looking to put in dispatchable storage that where we can make where they can from a financial perspective perform over time which probably also means
59:00 - 59:30 you know can perform for the grid as well that's this one's out to anybody who wants to jump on that one here you have nodal prices that have high volatility where there's great grid congestion is where i put my money grid congestion what do you think stephanie yeah i think right now too the markets are lagging a bit right so looking at markets that are really focused on being able to uh to allow you to do that revenue stacking right like you want to get the the most for
59:30 - 60:00 your dollar so i i would look at those industries that are really leading um or those markets that are really leading and say this is where i'm going to put it because i get to offer multiple different support uh different applications what do you think ken well i think it's uh really looking at the generation mix of where these uh resources are going and where things are being retired where there's going to be a demand where demand is going where
60:00 - 60:30 where there's going to be a need um the uh steve mentioned the the congestion is another thing you know and for a search perspective where a lot of the renewable is going you're gonna need a state storage so so you have to look at all these dynamics in the market and find it find an optimal place for you i'll give a slightly slightly different answer and then i think we're out of time but you know when i look at the industry and where it is today i think from from an insurance and finance perspective we
60:30 - 61:00 need the industry to grapple and figure out how to finance and ensure the risks around these things so that we can finance these projects so that we can move them forward financing is one of the big hurdles today for really grid grid level uh storage uh regardless of where it is and if i was gonna put my money to solve something somewhere that would be it makes sense i think we're i think we're pretty much out of time here uh although we had a lot more uh questions flow in hi was that
61:00 - 61:30 hi yes thanks mike indeed great time management but also lots of questions still unanswered so what i would like to propose is we take those questions send them through to you and an upcoming content that we have for the campaign we can take those questions probably into the content so thanks for a great engagement of the audience as well as a great panel we got some thank you notes already to all of you so i'd like to pass them on straight away but thanks and looking forward to hopefully continuing this discussion in the solar asset management north
61:30 - 62:00 america conference where there will be plenty to discuss from what we heard today so uh wish you all a great day and thanks for attending and uh to the speakers for sharing your knowledge sounds great thank you everybody thank you for the opportunity good seeing everyone bye now