 Think Tech Hawaii. Civil engagement lives here. Good afternoon again. Howard Wiig, Cold Green, Think Tech Hawaii. Thank you so much for joining us. We have a very exciting program today. What could be more exciting than battery energy storage on the tip of everybody's tongue? My guest today is Ted Clothier of the Distributed Energy Resources Council, and he'll be talking about the particular company that he represents. And we're going to describe some, in my totally unbiased opinions, some pretty revolutionary concepts that are sweeping Hawaii right now. Before I introduce Ted, and he can do the techie thing, let me do a totally un-techie explanation of why we need battery storage in our electrical distribution grid. Think of an enthusiastic kid, 10-year-old Johnny, and he, all morning, has been out playing with his buddies, getting hungrier and hungrier, and he staggers into his home, and his mom says, Johnny, I got you your favorite food, greasy pizza. Have a piece. Gobble, gobble, gobble. Oh, that's great, Johnny. Have another piece. Gobble, gobble, gobble. Have another piece, Johnny. Johnny, you're hungry. Come on. Gobble, gobble, gobble. I don't feel so good, mom. Throw up all over the kitchen floor. What does that have to do with anything? That is what happened to Hawaii Electric with regard to PV energy. There was more and more PVs, photovoltaic, electric sunshine, two electricity units going up on roofs all over Hawaii, and there was this phenomenon called dim-rim, distributed energy, no. Net metering? Net metering, net metering. Net energy metering. Yes, yes. Now that means that for every kilowatt hour that that system produced and sent back into the grid that customer's electricity bill was reduced by that much. So if they use 700 kilowatt hours a month and they produced with the PV 650, they'd be charged only for 50 kilowatt hours a month. Pretty gosh darn good dollar savings. So the payback time as the salesmen were totally, totally ready to assure you was really, really quick. And that is the equivalent of jamming one piece of pizza after another downpour Johnny's throat. And just like Johnny had to regurgitate, the PV electricity energy got such in the middle of a sunny day that Hawaiian Electric could not digest it. And they had to do something called curtail, that renewable energy, because they could only throttle their power plants back so much if they shoddle in the back anymore, just like a car engine stalls, the power plant would stall. So they had to take alternative measures and the production of PVs went way, way, way, way, way, way down until, I think I'll let Ted, is this a good segue for you, Ted, to talk about something almost miraculous happened to get Johnny's stomach all ready for more pizza or Hawaiian Electric all ready for more PV energy. And what might that new technology, or not so new, technology be? You bet. Well, and it's an old technology, but one whose time has really come. And that is, that, you know, it's energy storage. I've certainly heard lots and lots of applications for energy storage proposed in my career, but never as a cure for indigestion. So thank you for that, the first. But, you know, we've got some slides here. We can, you know, show you a little bit about what we do. STEM, the company that I'm with, is a company that specializes really in the AI, the intelligence needed to operate batteries. And we really want to focus when we talk about using batteries on the electricity grid. We want to use more intelligence, more of that AI-powered machine learning driven capability set and less battery if we can. A lot of buildings don't have room. The grid doesn't always have space. So we're really trying to get the most out of the batteries we put out there on the grid. And that's why the title for my slides today was Brain Power, Not Battery Power. That's really where the focus is. Just to be clear, the basic function of these batteries is to absorb that excess electrical energy in the middle of the day or a lot of hours during a good sunny day so that the all of it is used instead of having to be curtailed because of why an electric photon stomach is all full. This absorbs all that energy so that we can make use of it when it's needed. And I think that's another good cue for you. Yeah, that's right. You know, people in the energy industry a lot of times talk about the duck curve and that maybe is where the analogy really fits, is that that battery storage does make the belly of the duck able to hold more. We can actually put more solar on a system and then we can shift it into that evening peak. So that's one of the main applications for storage, but there are a number and we'll get into some of the other ones as well. It sounds very sophisticated here. In the slides. Sure. So we'll go to the next slide. The theme that I wanted to bring out here is probably something that you're familiar with, that listeners may be familiar with. Electricity is changing rapidly. We're talking about a decentralizing of the electricity system. You know, you think of the old grid of the past as being kind of a hub and spokes model where you've got a power plant in the middle with a telescoping power line that gets smaller and smaller as it goes out along these long feeders away from that power plant all the way down to your house that's 10 miles away or whatever it is. Well, we're really flipping that model just like the Internet. You used to dial up to a mainframe computer, get all your computing done, and then it would send you your answer back down. Well, now we've got network computers and they're all over and they're all talking to each other. That's how kind of the power system is evolving is that we're generating electricity all over the power grid now, not just in the middle and sending it out. That introduces huge new challenges for the utility, but also major opportunities for the consumers and for the consumer in the utility to have a new kind of relationship where they really are long-term partners in this operation of the grid together. It's important to understand how batteries play into that because as we get more and more solar onto that utility system, we do need batteries to help manage those amounts, right? The sun's only shining in the day. And with those batteries, we can utilize 100 percent. Yeah. We can. That's right. Let's go to the next slide here. You know, we really are talking a little bit about both the time and the place here. And so, you know, when we talk about the timing of energy use, we want to understand not just, well, the sun shining in the day and we've got a lot of evening usage, so can we just move the energy? But there are lots of other factors to consider. So there might be time of use tariffs, which means that you might pay a little bit more for energy at one time a day than at another time of day. And the utility's... And that is coming. Yeah. Wine Electric is experimenting with that. Yeah. We're starting to see the rise of these or the experimenting with them. There's a pilot right now just for residential folks to show how this can really change some of those behaviors. And what we are ultimately potentially headed towards is something where the price of electricity could change throughout the day multiple times. And that's just too complicated for a person to want to deal with, generally speaking. Let's just give a real simple illustration of time of use, because in the middle of the day, there's all this sun shining, all this electricity being produced by the PVs. There's too much. Wine Electric might make that time of day cheap. Yep. And that'll encourage the customer, not just the residential customer, but the hotels, the office building, so far, to use as much as they can during that time, say from 10 a.m. to 4 p.m. or whatever. Illustration at the residential level, you have your washing machine, you have your dryer. Why not put those on a timer? Washing machine goes on at 10, dryer goes on at 1 p.m. Yep. That's right. And that's exactly what we do at my house. You know, the way that some of these prices, these time of use prices are actually working their way into the solar and the energy storage options for homeowners is through something called customer grid supply or there's some new tariffs like that where you're motivated to set your dishwasher or to run your dryer during the middle of the day because you're actually getting an economic benefit. And it's set up so it's real simple. You set that timer on at 10 a.m. and you walk away. That's not very complicated. That's right. It's a pretty easy thing to do once you get into the habit of it. So we can kind of continue on with, you know, on that same theme. There can also be a different value to the location of energy. And that's something that I think is also maybe a few years away, but it's something that we've got to start laying the groundwork for now. There could be parts of the grid where there's lots and lots of sun over on the west side of the island and there's lots of rain on the Windward side. And you could have a need for some energy in one part of the island and not the other. And we're really not quite there yet in terms of operating the grid with that level of specificity or asking individuals to think about those prices with that level of complexity. But with that artificial intelligence and with automatically driven battery systems, both homeowners and business owners will be able to really take advantage of those kinds of tariffs in the future. I live in the back of Manoa Valley and I'm downtown. It's all nice and sunny and warm and I look back there and I can't even see the mountains because there's such heavy rainfall back there. Yeah, exactly. And it might be sunny as can be Coalina or somewhere, right? So that's kind of, I think we can move on to the next slide. That's kind of the timing and the location pieces. When we think about approaching a business, STEM works primarily with business owners, so that's more my background. But we also can certainly talk more about the residential folks. But coming from a business mindset, a lot of business owners have already thought about the low hanging fruit, if you will. They've done LED lighting. They've gotten a more efficient HVAC system. And then hopefully many of them have gotten a PV system, solar PV system. And there's still going to be some energy use left. A lot of times there's also still going to be a peak that they can't control with their PV system because you have one really rainy day and you are going to, you're going to cause a peak that the utility's got to be ready for. The grid has to be ready for that peak. They don't know when it's coming. And they have to charge for it because they need more money. That's right. And that's the demand charge, I think you're referring to. And that's one thing that we can help a business owner reduce is by reducing their peaks on a regular basis, we can reduce their demand charge. Residential folks don't face that demand charge. And so you really have to think about what exactly is the business or the homeowner trying to do with storage and not just think, oh, well, I have a PV system now. I need storage. We really need to ask one layer deeper question. What are you trying to achieve? Because it's costing them money and you want to give them the best bang for their book. That's right. And we talk about batteries and one of the questions that comes up all the time is, well, can this battery back up my house? Can it back up my business? Well, if you want a battery that's going to save you money, you're probably trying to go for the smallest battery possible. And one that's just doing that function that you bought it for, or that you're getting that service from the company to do that. And you don't want to oversize it. If you want it to be ready for backup, you've got to oversize it. So it really, it gets down to the individual consumer choice. But that's a kind of a different category of functions for batteries. And on that cherry note, we need to take a break back in a minute. Think Tech Hawaii, Tad Colossier, our guest. Code green, Think Tech Hawaii, Tad Colossier is my guest. And we are on the incredibly fascinating subject of battery storage and controlling the electricity in those batteries to suit or to give the best payback for the homeowner or for the commercial consumer. Why don't we go to the next slide and we'll talk about different types of batteries here. That sounds great, Tad. Thank you, Howard. So, yeah, you know, these are just the battery systems that STEM offers, but there are a number of other ones out there. And I wanted to kind of give a representative sort of small, medium and large. And again, these are, you know, based on my background, these are business batteries, but there are also batteries that are smaller that a homeowner would get, maybe put in their garage or in their home and other places. So what you're seeing here, you know, both of the smaller battery systems are ones that are indoor only. It takes, you know, a larger container. It takes more space to weather rise a battery for outdoors. And so when we're going indoors, we want a dedicated indoor only battery system. They're modular. You can break those towers up, but a lot of times we're going into the already built environment. And so it's really important to have a way to go into a building and say, well, here's how much battery you need, but we've got to fit it into the electrical room that's already full or maybe a little storage closet nearby that's only got room for certain boxes. So we really, you know, want to have different options for the different environments we have and for the space that we have to fit into. And a lot of times we want to be able to bring those batteries in through an elevator or in through doorways and around corners. And that just doesn't allow, these are pretty heavy. It doesn't allow for bringing a forklift or a crane or bring something really big. So we bring them in in pieces. We assemble them in place and and a commercial electrician wires it all up into the distribution panel with standard available parts and supplies conduit and wire. And that's, you know, that's kind of how these things are installed. And that brings to mind the topic of safety. For a long time, people were concerned that this battery was either going to catch fire or blow up. We had the Kahuku fire. Are you familiar with the Kahuku fire? Yeah, I am. It's very unfortunate. Yeah, why don't you cover that and say those were the bad old days for this reason. And now we have real, real safety. And this is something I was working on with the city and the county building code inspectors where they would look at a permit. Battery, bad, might blow up, not on my watch. And there was a huge permitting problem, but we've managed to smooth that out now. We're permitting apparently is now really, really, really quickly. That's right. And the permitters have seen a lot more battery systems now. And so they know what they're looking at and they're more comfortable. And we've got great dialogue going, especially now with the city and county coming to the table with the senior fire inspectors and with the trade associations, the DEA council, the solar association. So we've all gotten together and said, hey, we want to actually share our information about these systems with you so that you know what you're seeing. When you see the next plan set, you can tell what kind of signage you'd like on there. The fire department can weigh in. They like to know where the battery system is in the building. You don't have that sign posted somewhere. But the national standards have also really gotten more clear as the industry has evolved. And so these towers that you're looking at, there are multiple UL certifications. There's a UL certification just for the battery. There's a UL certification for the inverter. And there's another one that you get when you're putting the whole package together and you get that certified. So we're really relying on these national standards that are the same as what you'd have on a flat screen TV or a toaster that you've got to go through rigorous, rigorous testing to get those certifications. And I'm a building codes guy, and we are carefully incorporating those national standards into Hawaii's building codes. That's right. And then those national standards get updated every couple of years. And we have one of our senior engineers on that national advanced storage committee that works with the fire departments to help define that code. So we're really trying to get the experts from the industry together with the plan checkers, the reviewers, first responders, and make sure that there's... Yeah. This kind of reminds me of the airline industry. Why are airplanes so safe? Because there are a Julian, Julian safeguards. And I don't think batteries are going quite through that rigorous routine. But it's a similar process. It really is. So, you know, and there's some fundamentals too. We really are seeing just a higher level of quality coming out of these. These are manufacturers of batteries or global scale, you know, manufacturing facilities that are really the best in the world at what they do. And so there's consistency and the products coming out are safer and safer. And it's not only Americans who are doing this. I know China is going after this really, really big, I assume, Japan, Europe. Yeah, that's right. And everybody communicates with one another if there is a disaster, just like the airlines. Everybody's going to know about it and everybody's going to know what in the world happened here. And everyone focuses on it and makes sure that doesn't happen again. You know, the size of these batteries also is really on a different scale than the size in that case as well. In most cases, we're talking about if we're going inside of a building, something much, much smaller. And so following in the wake of the electric vehicle industry, where you might be perfectly comfortable having multiple electric vehicles inside your building's parking garage and plugged in to the distribution panel in there, you know, we're looking at systems that are on that scale, you know, like a couple of electric vehicles, not a, you know, a whole container necessarily. Once you get to that scale, you're typically outdoors. And so, you know, that does improve the safety for having a larger scale. Battery is typically going to be outside. And that's that, coming back to the slide for a moment, there's that third battery form factor that we didn't look at. Yeah, yeah, it was the one on the right side of the screen there. And those are, you know, boxes that are about seven feet tall and four feet deep and three feet wide. And each one of those, they're all, you know, pad mounted. So they're going to sit outside of a building and they've got a cooling inside so they don't get too hot in this, you know, humid, the tropical environment here. And that's really where you want to be with a system of that scale. Yeah, this might be, for instance, out in the parking area somewhere. Yeah, you might take over a parking spot. You might put it next to the, a lot of times, buildings have an area where the transformer is, where the power's coming in. That's usually near the electrical room. So we'll try to do something as near as we can to the electrical room. Yeah, absolutely. And then there's, you always want signage there. I think signage is required. Absolutely. It's right there with the rest of the electrical equipment. Yeah. And, you know, it's funny you should mention signage. We've had to go back and forth a few times because different folks have asked for a different signage. And so even just getting everyone on the same page about, okay, what exactly do you want the signs to say? Where exactly do you want them to be? Took getting everyone to the table and having, you know, that we helped to drive that, that, you know, the plan checkers and the inspectors and the first responders all needed to have their say in that so that we could come up with the best solution. Absolutely. And in any endeavor that is always the best policy, get all of the different stakeholders together right in the beginning, just when you're in the planning process. That's right. Because it's, that's a heck of a lot cheaper than beginning to build something. And the fire chief comes in and says, no, no, no, no, no, no, no. Then you have to tear down your existing structure and so forth. That's right. This is a great planning process here. Yeah. So I think we're really moving into the future here with that. I think we can go on to the next slide here. Yeah. We wanted to highlight a little bit more about what demand charges are. This is a great example. So on the left, you see these, this mountain range with these peaks that can jump way up. And that's a business electricity use for, you're looking at about 10 days worth of their load there. Each one of those major bumps is one day. So right about where the peak is, that's probably around the middle of the day. And then it's around, say, four or five, it slides way, way down as everybody begins to leave the office building. That's right. And this is, you know, each business is different. So this is a business that peaks in the middle of the day. It might be an office building or it might be, you know, an auto body shop. It's going to look different for, let's say, a grocery store where you have lots and lots of activity after work when people come. The other extreme, a hotel where you have this big slump in the middle of the day and all of a sudden five in the afternoon, whatever, all the tourists are coming back. Yeah. Hotel is going to look a lot like residential. It's going to look like a big condominium building or something. It's going to have that evening peak when everyone's turning on their flat screens at the same time. And opening and closing the refrigerator and turning the oven on. Yeah. And so what a battery's got to do in every case, it's different. And so a battery has to have some kind of intelligence and some kind of AI driven control that can learn this shape is different than that shape. Or I know what a general hotel shape looks like, but I don't know that this hotel's got some differences. And so you've really got to have some learning software that's very fast. And they can then say, okay, I'm going to make a prediction about what this load shape is going to do. I'm going to respond to that prediction. I'm going to give this customer a more optimal energy profile. It's going to save them money. We have to save them more than a cost, right? You've got an economic tradeoff that's pretty important there. So we're really focused on that. There are, on the other side of the slide there on the right hand side, there's a number of different uses that we just kind of cataloged what both in front of the meter and kind of behind the meter services a battery can provide. And so we've talked a little bit about increasing your PV self consumption. So making sure, well, instead of sending my extra PV back to the grid, I'll use it. And I've talked a little more about demand charge reduction. And we spoke about time of use bill management in the beginning. There's a few other uses that the utility or on the mainland, the ISO, you know, that sort of balances between multiple utilities can get from batteries, even when they're located at a customer's location and not up at some substation or up at some grid controlled location. And we've got about 30 seconds left. But in summary, what the batteries do is look at those peaks where the, especially commercial customers getting charged big bucks. And what we call shaving those peaks down so that his bill is less. And the utility as a whole doesn't have to ramp all that up. And they use extra energy that way. That's right. So that helps us solve my problem, which is reaching 100% clean energy by the year 2045. And that's what we're all focused on. And on that cheery note, unfortunately, we've got to sign off Howard Wigg, Code Green, Think Tech, Hawaii. Thanks so much, Ted Klossier for joining us and giving us a peek into the future, the present and more so the future. This industry is going to grow like mad. I think it is. Thank you for having me on the show.