Energy Storage Paths To Market

David Surplus Chairman

B9 Energy Group

Paths to market

This presentation covers the following paths to market...

• Onshore wind farm re-powering • Onshore wind farm extensions • Offshore wind curtailment • Integration with Anaerobic Digestion • Integration with large scale biomass • Sub-station support and Microgrids • Independent Peak Lopping plant • Industrial site energy cost management • Solar power station development • Innovative wind farm O&M – Revenue Guarantees

Paths to market

• Onshore wind farm re-powering

Re-powering of 20+ year old wind farms • Repowering market is growing • Modern wind turbines are more productive for a given land area • Grid connection equipment has much longer life than wind turbines • Increasing the export capacity is likely to require high cost re-enforcement • Storage allows existing grid to be used • Storage is easier to finance as an integral part of a new build site

Paths to market

• Onshore wind farm extensions

Slieve Divena II • “Slieve Divena II (20MW) wind farm extension was consented in October

2007. The eight turbine site is currently on hold pending grid connection infrastructure availability. Subject to the grid connection becoming available in 2015, we expect to begin construction in late 2015.”

• Energy storage could allow the existing grid connection to be used. • Saving time, increasing revenue, reducing intermittency • Cost of storage plant is offset against grid connection cost savings

Paths to market

• Offshore wind curtailment

Offshore wind project location

600 MW wind

600 MW Offshore wind

404 + 595 + 636 + 600 = 2235MW

Curtailment of 3% to 9% in 2020

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NI Electricity Demand 2011

Export through interconnectors? ROI and Scotland are windy too!

German offshore wind constraint

Curtailment projections

• Scenarios for increasing installed capacity of wind • Predictions of future wind speeds • Predictions of future electricity demand • Grid capacity constraints tempered by program of re-enforcement • Projection of extent and duration of curtailment • Projection of consequential loss of revenue for First Flight Wind

• Storage projects provide load to avoid curtailment • The SMP is very low at times of curtailment – see chart below • This helps maximise the arbitrage opportunity

Minimum System Marginal Price

2p to 3p /kWhr

“Load on demand” for offshore wind

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Double ROCs / EMR strike price Electricity sales

Offshore wind farm Income stream with curtailment p/kWhr

offshore wind farm income stream could

be restored at a reduced rate and...

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NB: This is less attractive to onshore wind with 0.9 x ROCs / lower EMR strike price.

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If we provide “load on demand” to keep the

turbines running then.....

storage could be paid at the rate of 5p/kWhr....

Which makes arbitrage energy costs become

negative overall

Paths to market

• Integration with Anaerobic Digestion

B9 Energy’s 60 kTPA AD plant at Dungannon

Could sell waste heat to make ICAES more efficient

German retrofit market –

7000 AD Plants

Paths to market

• Integration with large scale biomass

• Former Power station West • 16.2 acres controlled by NIE • Additional 4.07 acres from BHC • 240MW former coal fired plant • 110kV grid connection • No competing heat customers

Proposed biomass plants in the UK

• Sub-station support and Micro-grids

Paths to market

11kV Network (3-phase)

Lecale DSU

33kV sub-station (Community Sub-station)

Farm scale AD ICAES (N I Energy Storage Demonstration Park)

“Lecale” Aggregated DSU for

11kV circuits

• Aiming to be self-sufficient in electricity • Aiming to be a net exporter of electricity • More than 70 x rural 33kV sub-stations in NI

250kW wind turbines Solar PV Additional AD 2nd life traction battery charging Ammonia production 300 houses + EVs as a captive customer base “Seagen” Tidal test site

NB: Ammonia can power... • Tractors • Fishing boats • Ferries • Standby gen-sets upsold as... • Peak lopping gen-sets

Small wind planning applications

Thermal constraint management

Microgrid revenue streams...

• Arbitrage – Buy at £20 to £30 / MWhr Sell at £80 to £250 / MWhr • “Load on Demand” services to avoid external curtailment (30% of wind strike price?) • Direct sales on long term fixed price (+RPI) basis • Consideration for avoided cost of grid upgrade • Ancillary services: Reactive power management Voltage regulation Possible provision of inertia

• Capacity market payments

Other microgrid benefits...

• Additional microgrid revenues allow voluntary reduction of ROC revenues on single generator projects – easing price rise pressure

• Security of supply to load customers is improved • Autonomous operation possible - to ride through

central system blackouts if necessary

• Independent Peak Lopping plant

Paths to market

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Winter day - 1/2 hourly demand

08/11/2011

300MW Peak

4 hour duration

“Load following” generation mode

Peak lopping services from... •Batteries •Salt cavern CAES •ICAES Expanders •NH3 powered gen-sets

• Industrial site energy cost management

Paths to market

Industrial site energy cost management • NI has 2nd highest industrial energy costs in the EU. Higher than both GB and ROI • Many industrial facilities have fitted gen-sets to run at peak times of day • ICAES is projected to provide a cheaper solution for such peaker plant applications • LightSail have focussed strongly on this route to market

• Solar PV management

Paths to market

Solar PV management

Smooth out the cloud variations and reduce ramp rates

Shift export from lunch time to tea time

• Innovative wind farm O&M – Revenue Guarantees

Paths to market

Guaranteed Revenue Post Warranty

• As wind turbines get larger, O&M KPI’s are shifting focus from “availability” to “Yield” • Deployment of an energy storage facility allows aggregation of the wind farms output • This output can be sold at higher prices to compensate for a turbine being off for planned maintenance or a fault condition • Revenue can then be guaranteed in the O&M agreement • Higher yields can be achieved by doing planned maintenance on calm days • Wind farm technicians can service ICAES systems on windy days

THANKYOU!