Ameresco’s Commercial Microgrid and Solar-plus-Storage Ambitions

Ameresco is best known as a commercial and industrial energy
services company, or ESCO, competing against giants like Honeywell,
Siemens, Johnson Controls and a host of other national and regional
providers on HVAC retrofits, LED lighting upgrades, and other
building energy efficiency services. The Framingham, Mass.-based
company also has a significant military microgrid resume for
C&I customers looking at always-on power. 

But like every other modern ESCO, Ameresco is seeing an growing
opportunity for solar PV and energy storage to play a role in its
customers’ holistic energy needs — at least in the markets where
they make sense. Jacqueline DeRosa, Ameresco’s vice president of
energy storage, says that list of markets is quickly expanding.

“Ameresco is everywhere, and very well known on the East
Coast,” both in the U.S. and Canada, she said in an interview
last week. But in the past year, it has also acquired companies
giving it a West Coast renewable energy footprint,
including TerraNavigator,
a California-based company specializing in brownfield solar and
landfill methane capture projects, and Quantum
Engineering
, an energy service company serving schools,
universities and municipalities in Oregon and Washington state.

“We’re not just a behind-the-meter solution. We have quite a
bit of renewable generation across the country,” she said. But
Ameresco’s focus on on-site power has given it a wealth of
expertise in how to integrate intermittent and sometimes
unpredictable renewable generation into the most solid of microgrid
environments. 

To be sure, Ameresco is competing with
well-funded developers
in a challenging and fragmented market.
The U.S. market for commercial and industrial solar, storage, and
solar-storage systems is actually 50 markets, with each state
setting the framework for cost-effectiveness via legislative
mandate and incentives. The U.S. commercial solar market has
contracted in 2018 and 2019, according to
Wood Mackenzie Power & Renewables
, largely due to
increasing market saturation and shifts to less favorable rate
structures and incentive programs in key states such as California,
Minnesota, Massachusetts, New York and New Jersey.

Yet while the C&I sector might not be growing as fast as
U.S. utility-scale solar and storage sectors, it’s not suffering
from the the record-breaking low prices that have driven the latest
round of mega-procurements, she noted.  And we’re “definitely
pushing for the solar-battery combination” where it makes sense,
she said. 

Always-on power versus solar, storage economics

Renewables can be built into large-scale energy services
contracts. United States Marine Corps Recruit Depot Parris
Island
hired Ameresco in 2015 to build a $91 million solar,
battery, combined heat and power (CHP) and generator-powered
microgrid for its South Carolina facility. The resulting $6 million
a year in energy savings is driven largely by CHP economics, but
also from the 6.7-megawatt solar system and 4-megawatt, 8
megawatt-hour battery system from Tesla.

As with any military microgrid, however, always-on power is the
top priority. Ameresco’s $44 million project at the
Portsmouth Naval Shipyard
in Maine, put in place to prevent a
power loss from the local public utility that could interrupt a
hugely expensive shipbuilding process, includes no solar and only a
500-kilowatt battery alongside megawatts of natural gas turbines
and emergency diesel generators. Ameresco built and runs the
6-megawatt natural gas generator at the heart of the Philadelphia
Navy Yard microgrid project, which can sell its capacity to
mid-Atlantic grid operator PJM as well as provide backup
services. 

To be sure, the microgrid market is still
dominated by fossil fuel-fired
technologies, since there’s no
other cost-effective way to provide critical facilities like
airports, hospitals, fire stations and water treatment plants. But
falling solar and battery prices has driven the development of
“hybrid generators,” or generator and battery combinations
from global generator giants like Caterpillar,
Aggreko, Wärtsilä and Cummins that
can serve both as standalone generators or as the core of a
solar-powered microgrid. 

Ameresco is also seeing demand for clean energy credits, demand
charge reduction and other capabilities that solar and batteries
can provide from would-be C&I microgrid customers, particularly
in markets where it makes sense, DeRosa said. “Obviously we’re
focused on the markets where there’s progress on states studying
storage potential, and passing legislation. The incentives are what
makes it work.”

Ameresco has its most active storage efforts underway in
California, Massachusetts, Hawaii and New York, and is keeping an
eye on Arizona, Nevada and New Jersey for their storage potential,
she said. 

California leads the market for behind-the-meter batteries and
solar-plus-storage installations to date. On the storage side,
that’s largely been driven by two factors — relatively high
demand charges for commercial and industrial customers, which
batteries can help reduce, and generous incentives from its
Self-Generation Incentive Program (SGIP). 

But “we’re starting to see some of the same factors we’ve
seen in California starting to happen in other states,” she said,
with Massachusetts as a key example. “We’ve already covered how
state incentives and federally mandated energy market opportunities
are driving
novel energy storage business models
in Massachusetts.” Beyond
those, the state’s Clean
Peak Standard
 will serve as a big boost to Ameresco’s
community solar-plus-storage proposition, she said. 

The Clean Peak Standard will require a minimum level of clean
energy to serve during the hours when the state experiences its
most costly price spikes — largely summer afternoons and
evenings, but also during increasingly cold “polar vortex”
events. “Serving that load with conventional peakers is
expensive. If you can serve that peak with clean energy, it’s
better to do so — but you have to have the incentives to do
so.”

In January, Ameresco acquired Maximum Solar, a Massachusetts
solar operations firm, to boost its efforts in a state that’s
promoting energy storage at both utility and community scale. While
the Clean Peak standard is still in development, “2020 is when it
will really ramp up,” DeRosa said.

Source: FS – GreenTech Media
Ameresco’s Commercial Microgrid and Solar-plus-Storage Ambitions