The road to renewables will not be paved by the environmentalists. Instead, the path is being cut by the accountants, and health care provider Kaiser Permanente is showing how to do it right.
Kaiser is on a mission to slash its carbon emissions on the road to full carbon neutrality by 2020, and is making headway on slashing the half of its footprint that comes from its electricity usage. Kaiser has photovoltaic solar installations on nearly 50 of its buildings today, with plans that could see that number doubling in just the next two years.
Kaiser is looking beyond solar into energy storage, buffeted by the falling prices of stationary energy storage, resulting in a new push to add energy storage to its existing and new solar installations. Kaiser’s director of energy and utilities, Seth Baruch shared with GreenBiz that:
“We will combine onsite generation with battery storage in a number of places. That is [a strategy] tied to resilience and grid reliability, [and] it will also help optimize the economic benefits of our solar projects.”
The combination of solar and energy storage takes on new meaning beyond just greening the company image in a hospital where the ability to provide care when the grid goes down can literally mean the difference between life and death. To explore the potential of a full-blown renewable facility, Kaiser went all-out at its Richmond, California facility, where it supplemented a 250kW photovoltaic solar installation with a 1 megawatt battery that can keep the hospital’s systems up and running for 3 hours in the event of a power outage.
The Richmond installation shows that renewables have a place beyond the environment, beyond just cost savings on electricity, and are increasingly being used as the backbone of robust disaster recovery systems that add to the financial allure. In doing so, the Richmond facility has installed what has evolved over the last two years into a full-blown microgrid, with the potential to island itself from the grid in the event of a grid failure.
On the savings side of the equation, the photovoltaic solar installation at Richmond is expected to produce 365,000 kilowatt-hours of electricity per year, which is worth $54,750, but the bulk of the savings come from the battery. The battery is expected to deliver just north of $430,000 in the form of power efficiency, demand reduction, and arbitrage of power.
In addition to the firm numbers, the team believes there is potential to save somewhere in the range of $40,000-80,000 per year through automated demand response. They are also looking to play in the CAISO market with rapid power quality that would have the battery playing a role in regulating the frequency of the grid, absorbing bumps and spikes as needed to keep everything playing nicely. This is an especially important – and potentially lucrative – role in the grid of the future as more and more distributed renewables come online. “We should do this at any site where it would be at or below the avoided cost from the utility,” Baruch said.
Over the last 10 years, Kaiser Permanente has successfully reduced greenhouse gas emissions by 29% and is looking to do more as the financial picture for renewables, energy storage, and microgrids continues to improve as the technologies mature. Kaiser’s push into renewables and microgrid technologies is admirable and shows how a progressive company can successfully blend its financial goals, environmental progress and even its ability to respond to grid outages and disasters more effectively.
Kaiser has made commendable progress towards achieving its carbon reduction goals and continues to push the envelope as it looks beyond its facility in Richmond to reapply the learnings from the flagship project to its other facilities. The efforts to integrate renewables is being run in parallel to an equally intensive push to slash its energy consumption by implementing cutting edge energy efficiency solutions.
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