A series of setbacks for flywheel energy storage last year made us wonder if the technology was just spinning its wheels. But this morning things are looking up for the tech’s long road to commercialization, with word from the Department of Energy that it has awarded a conditional $43 million loan guarantee to Beacon Power (s BCON) to help with construction of a 20 MW flywheel energy storage plant in Stephentown, NY — the first full-scale commercial deployment of the company’s technology.
The Obama administration also announced a $16 million guarantee today for Nordic Windpower to build an assembly plant for its two-blade 1 MW wind turbine, bringing the number of awards under a much-delayed DOE program to three in the last four months (Energy Secretary Steven Chu made it a priority to accelerate the program when he entered office). In late March, cylindrical solar panel maker Solyndra snagged the first guarantee — for a whopping $535 million — to finance a new factory, three years after it applied for the funds and four years after Congress created the program. While Beacon’s guarantee is small relative to the one offered to Solyndra, it could help boost momentum for flywheel tech as well as the company, which has scored a few key deals in recent months after a rocky end to 2008.
Based in Tyngsboro, Mass., Beacon uses large spinning discs contained in a vacuum to keep electricity flowing over the power grid at a steady frequency — basically helping to stabilize the grid and allowing it to run more efficiently. Flywheels, which need little maintenance over their 20-year-plus life span and don’t have some of the toxic chemicals found in many batteries, are sometimes used as backup power for emergency power systems — what’s called uninterrupted power supply, or UPS (as explained in our smart grid energy storage FAQ).
Beacon had planned to raise capital and add 4 MW of capacity to a project in Tyngsboro by the end of last year, but announced in November that it would delay fund raising and slow down the expansion “in response to uncertainty and volatility in the equity markets.” But by February, Beacon landed a $3 million contract with U.S. Naval Sea Systems Command to look at flywheels for shipboard applications, and just a few weeks ago it scored a $2 million contract with a New York state utility operator to get started on the 20 MW Stephentown project that today’s loan guarantee will help it complete (providing some 62.5 percent of total financing for the estimated $69 million buildout).
According to a release from the DOE this morning, the Stephentown energy storage plant will absorb and discharge energy to the electric grid, making it possible to use more variable renewable energy sources (solar and wind power aren’t always available, and the current electric grid lacks storage capacity). Beacon President and CEO Bill Capp notes in the company’s announcement this morning that completion of the new plant will represent “a major transition” for Beacon’s flywheel tech — from development and pilot operation to commercial scale — adding, “For New York initially, and later other regions where plants could be built, it will also signal a dramatic shift to a cleaner, more sustainable method of providing frequency regulation on the grid.”
As we’ve written before, energy storage represents a pivotal component of the smart grid, but until recently it has largely played second fiddle to digital intelligence for the power grid in the eyes of Congress, investors, utilities and entrepreneurs. With one of the first three guarantees from the DOE, it’s getting attention that’s long overdue.
Frequency regulation graphics credit Beacon Power