Our good friend Chris Hunter alerted us to this story from Alaska. This is a great example of how they faced the challenges of going 100% renewable and in the end are able to reduce the cost of electricity to their clients.
There are thousands of communities around the world looking relying on diesel generation for electricity. What stands out with this story is how they learned from their mistakes. They have paved the way for others to follow through experimentation and innovation. One example is they have discovered that flywheels in combination with batteries is ideal to balance the grid than just using just using batteries alone.
The economic benefits of borrowing to cover the capital cost and using the savings on diesel fuel to pay of the infrastructure is another interesting finding
We covered the Kodiak Island before with a previous article :
“Co-op Power in Alaska with “Can Do Attitude”
Web Extra: An inside look at Alaska’s renewable island
KODIAK – Planted on Pillar Mountain, Kodiak’s six wind turbines are a fixture in the community. At 80 meters tall each — a bit smaller than a football field — they perch above the town and serve as a symbol for the area’s movement toward renewable energy.
In fact, Kodiak Electric Association — which serves the City of Kodiak and surrounding areas — is 99 percent renewably powered, according to KEA President and CEO Darron Scott. It’s been that way since 2014, thanks in part to expanding energy sources.
Kodiak’s six wind turbines provide about 17 percent of KEA’s power, but the supply comes inconsistently because it’s not always windy.Ever-changing energy
Keeping KEA’s isolated grid stable is key, Scott says. So in 2012, a battery energy storage system was installed to work in concert with the turbines and supply power on an as-needed basis.
But the 1,200 batteries were getting used up faster than anticipated, Scott says, and replacing them all comes with a more than $1 million price tag.
In June, a solution to the battery drain came online — two 1-megawatt flywheel systems, which are six and a half tons of metal that spin at about 3,600 rpm to produce power.
Oftentimes, Scott says, the grid only needs about 10-20 seconds of power for stabilization — the perfect job for the mechanical flywheels, which can quickly inject bursts of power before the batteries kick in.
“The flywheels have only been online for a few weeks, but we have seen a significant, multiple orders of magnitude reduction in use of these batteries,” said Scott in early July.
According to Scott, Kodiak is the first place in the world to use the battery and flywheel systems together.
When a new, 2-megawatt electric shipping crane replaces a decades-old diesel crane at Kodiak’s port in August, the mechanical flywheels will come in handy at the shipping hub.
Like the sporadic nature of wind power, the crane loads will vary, Scott says.
“These will track and basically filter that power so we don’t see all those fluctuations on our system when the crane is in operation,” he said of the flywheels.
The wind turbines may be the iconic energy source in town, but the bulk of KEA’s power — roughly 80 percent — is hydropower that originates at a 1,000-acre body of water called Terror Lake. Located about 20 miles outside Kodiak, the lake helps provide stable, low-cost power compared to the days of diesel reliance, Scott says.
Snowmelt and rainfall helps replenish Terror Lake. The water then travels through five miles of tunnel before ending up at the hydroelectric plant.
Ron Sternberg, a power generation technician with KEA, says a slightly oversimplified way to understand the hydroelectric setup is to think of a garden hose and a pinwheel.
“If you sprayed the hose at the pinwheel and started making it spin, that’s exactly what’s going on down there,” said Sternberg as he stood above the three generators at KEA’s hydroelectric plant.
The water used to generate power is clean and safe to drink, Sternberg says. Salmon, steelhead and Dolly Varden can be found in the tailrace, which contains water that has passed through the plant.
“There’s our fuel source,” he said as he stood near the tailrace. “It’s all clean. It’s perfect.”
Hydroelectricity isn’t new for KEA. Back in 2007, roughly 70 percent of the cooperative’s electricity came from hydropower, Scott says. That was also the same year KEA set the goal to have 95 percent of its electricity come from renewable energy sources by 2020.
Ninety-five percent seemed like a distant goal at the time, says Scott, who has been with KEA since 2000. But they reached 99 percent last year and have been able to maintain that figure.
Following the money
Expensive diesel costs served as a strong motivator in bolstering renewable energy sources. Generating Pillar Mountain wind power costs about 11 cents per kilowatt hour. Terror Lake hydropower goes for about 7 cents per kilowatt hour. Diesel generation, when diesel fuel prices are at $3.50 a gallon, costs the cooperative almost 29 cents per kilowatt hour, according to data provided by KEA. Diesel, however, is rarely used anymore.
According to Scott, KEA’s wind power costs are about half of what their diesel costs are. Hydro is about a third. With just the wind turbine project, KEA estimates it has saved 8 million gallons of diesel.
KEA’s push for increased renewable energy also came with a hefty price tag. State and federal funding — such as renewable energy bond loans with low interest rates – has helped foot the bill.
Scott says KEA has spent more than $60 million on renewable projects, including the wind turbines, batteries, flywheels and changes to the hydroelectric equipment. For him, the high cost has high reward.
“It did cost quite a bit, but one of the things about renewable power is you’re paying the debt but you’re not paying [for] the fuel,” he said. “They’re lower maintenance than diesel is, so it ends up being a very cost-effective solution.”
More hydro and wind power has been good for Kodiak residents’ wallets too. Electricity prices have recently spiked in many places across the U.S., but not in Kodiak. KEA customers’ bills have decreased by a few percentage points since 2000, Scott says.
“It’s just good for the person living here,” he said of the renewable projects. “It’s an expensive place to live and whatever we can do to help that be lower is a real good thing.”
Ben Millstein, founder and manager of Kodiak Island Brewing Co., says there aren’t dramatic fluctuations in his bill that could occur if KEA relied heavily on diesel. His electric bill has increased over time, but he says that’s because his operation has expanded.
At North Pacific Seafoods, one of the major processors in Kodiak, utilities are probably the company’s third biggest cost, says general manager Matt Moir. He echoed Millstein’s appreciation for consistency, saying the variation in diesel prices would hurt his company.
“Having a dependable source of electricity, having a dependable, constant price is important to us,” Moir said.
Risk and reward
Getting companies to sign on with them was an initial challenge, says Cliff Davidson, KEA board chair. KEA started out with three General Electric wind turbines in 2009. By 2012, they had six.
Risk was involved for both KEA and GE, but that’s how things go when you live on an island, Davidson said.
“Island life sometimes forces you to take risks,” he said. “For example, you’re never going to live on a grid, so if you know you’re going to have to burn fossil fuels way into the future, and the cost is just going to smother you, you have to find solutions. And I think that’s what we did.”
Of course, not everywhere is as windy and rainy as Kodiak, creating optimal conditions for generating wind and hydropower. Typically, Kodiak gets about 78 inches of precipitation a year, according to the Alaska Climate Research Center. Ted Stevens Anchorage International Airport, on the other hand, gets about 16.6 inches.
And compared to many places in the Lower 48, diesel is expensive in Kodiak.
“Kodiak had a major advantage of already having high rates,” Millstein said of electric bills when diesel was more in the mix at KEA. “So, the cost of installing some wind turbines on top of a ridge didn’t seem out of the question.”
Maintaining and advancing
Looking ahead, the goal will be to maintain existing equipment while looking for new energy sources like the flywheels.
And there are hurdles. The rain wears down the turbine blades, which can cause corrosion. The batteries are also about halfway through their lifespan.
Thankfully, KEA seems to have backing from residents, Davidson says.
“We’ve always had a tremendous amount of support from the community,” said Davidson, who has been on the nine-member KEA board for more than a dozen years.
Scott says diesel will continue to play a small part in KEA’s future, but doesn’t expect it to be much more than a just-in-case option.
When the wind turbines get going, they can sound like a plane taking off. During a tour in early July, the hydroelectric plant was humming with activity. At the old KEA plant where the diesel generators are housed, however, it was silent a morning. The cooperative hadn’t needed to run the fuel-based energy converters in weeks.