Probably not. Last week, the state Public Utilities Commission (MPUC) announced that it approved “Minnesota’s first stand-alone battery storage project.”
The details of the 150 MW project,
Located in Olmsted County between Byron and Rochester, the facility will store excess electricity from the grid for up to four hours and discharge it during times of high demand. The Snowshoe Energy Storage Project will help smooth fluctuations in energy supply and support the integration of more renewable energy into Minnesota’s power system.
The project is scheduled to go online in 2027.
The hope is that battery storage will solve the biggest problems with wind and solar power: its unavailability when there is no wind or no sunshine. Batteries, it’s hoped, can bridge the gap.
The project’s 150 MW size make it a pretty big deal. Rule of thumb, that could power roughly 45,000 homes for that four-hour period. And the 4-hour requirement is a pretty standard unit of utility measure.
The problem, of course, is that adverse utility events don’t always get neatly resolved within a narrow, four-hour window. What happens in hour 5, one could ask.
I personally investigated this concept almost twenty years ago, when utility-scale batteries were first becoming available. At the time, wholesale power prices showed wide variability, with on-peak prices usually above $100 per MWH, and off-peak prices at a rock-bottom $15 per MWH.
Coincidentally, I was looking to buy a 1 MW-sized unit, which I recall would weigh several tons and occupy a space the size of a standard international shipping container. MPR News reports that the Snowshoe project will occupy 18 acres.
My idea was to charge the battery in the middle of the night at $15, discharge during the peak daylight hour at $115, and pocket a $100 margin. But would the daily $100 margin be enough to pay for buying the battery and then hooking it up to the grid?
I couldn’t make it pencil out back then, and later the on-peak/off-peak price differential closed, making the whole thing uneconomic. But Showshoe is taking a different approach, MPR reports,
Federal tax incentives for battery projects were spared in the recent federal reconciliation bill – also known as the ‘One Big Beautiful Bill’ — although tax credits for wind, solar and other clean energy projects will be quickly phased out.
At the scale of a Snowshoe facility, the whole concept becomes self-defeating. By increasing the demand for power off-peak, and dumping more energy onto the grid on peak, you narrow that margin. My 1 MW proposal wouldn’t have been big enough to move the market
For consumers, it’s a terrible deal: you get to pay three times for the same product. You pay for the wind and solar, then you pay for the battery backup, then you pay for the natural gas plants standing by for when the batteries run out of juice. Then you get to pay all over again at taxpayers fronting all that subsidy money.
It all looks great on paper until the batteries catch fire, a problem hinted at in that MPUC press release. From the Associated Press (AP) back in January,
A fire at the world’s largest battery storage plant in Northern California smoldered Friday after sending plumes of toxic smoke into the atmosphere, leading to the evacuation of up to 1,500 people. The blaze also shook up the young battery storage industry.
To be fair, that was a 3,000 MW project. But California still thinks battery storage is a great idea.
What could go wrong?
