Benefits from Flywheel Energy Storage for Area Regulation in California— Demonstration Results A Study for the DOE Energy Storage Systems Program

This report documents a high-level analysis of the benefit and cost for flywheel energy storage used to provide area regulation for the electricity supply and transmission system in California. Area regulation is an 'ancillary service' needed for a reliable and stable regional electricity grid. The analysis was based on results from a demonstration, in California, of flywheel energy storage developed by Beacon Power Corporation (the system's manufacturer). Demonstrated was flywheel storage systems ability to provide 'rapid-response' regulation. Flywheel storage output can be varied much more rapidly than the output from conventional regulation sources, making flywheels more attractive than conventional regulation resources. The performance of the flywheel storage system demonstrated was generally consistent with requirements for a possible new class of regulation resources - 'rapid-response' energy-storage-based regulation - in California. In short, it was demonstrated that Beacon Power Corporation's flywheel system follows a rapidly changing control signal (the ACE, which changes every four seconds). Based on the results and on expected plant cost and performance, the Beacon Power flywheel storage system has a good chance of being a financially viable regulation resource. Results indicate a benefit/cost ratio of 1.5 to 1.8 using what may be somewhat conservative assumptions. A benefit/cost ratiomore » of one indicates that, based on the financial assumptions used, the investment's financial returns just meet the investors target.« less