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Virtual power plant turns into the USP of prime properties
Soleil Lofts, an apartment development in suburban Salt Lake City, offers a lot of amenities — pools, three spas, a basketball court, electric appliances, a dog park — to lure potential residents. But the feature that sealed the deal for Maik Kannenberg, a sales rep for a local tech firm, was a sleek, silent device: an energy storage battery.
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Kannenberg’s home, like every apartment in the $156 mn, 600-unit complex, includes a new ecoLinx battery made by the German company Sonnen. Charged via rooftop solar panels, these cells, roughly the size of a water heater, collectively form what’s called a virtual power plant. The system not only provides 12.6 megawatt-hours of backup power for the building, it also makes better use of the renewable power generated on site.
“If I can do a small part to make the world a better place, and make Utah a cleaner place, I’m happy to do it,” Kannenberg, 38, said.
Advances in battery storage and solar technology, coupled with the desire of utilities to expand renewable power, mean virtual power plants are fast becoming valuable tools for commercial and residential properties. Demand for resilient power systems, highlighted by the failure of the Texas power grid and the rolling blackouts imposed in California to decrease wildfire risks, has also made such technology more desirable. Batteries have commercial applications for all types of buildings, including those at many universities and corporate campuses, said CR Herro, vice president of innovation for the national homebuilder Meritage Homes.
“In the ’80s, people installed solar because they cared about doing the right thing,” he said. “Now, solar and battery systems like the one at Soleil are like putting an A.T.M. in your kitchen that spits out $20 every month.” As more drivers switch to electric cars, property owners could increasingly see value in generating and storing energy, especially at sites where dozens of cars may need to be charged at the same time. Many firms, especially in the energy industry, see potential in virtual power plants. OhmConnect, a start-up, plans to build a massive system with $100 mn in funding from Sidewalk Infrastructure Partners (which lists Alphabet, Google’s parent company, as an anchor partner), and Swell Energy in LA raised $450 mn for home virtual power plants to help the grid.
In Utah, Soleil Lofts signed a first-of-its-kind deal with Rocky Mountain Power, which can tap the batteries as a power source. This arrangement helps the utility save generating costs while helping the developer save money, according to the Wasatch Group, the Utah developer that built and manages the apartments. Wasatch executives see the virtual power plant as proof that batteries are a smart investment for building owners.
“The V.P.P. provides an income stream and makes this a more attractive property to rent,” said Ryan Peterson, president of Wasatch Guaranty Capital, the firm’s real estate and investment unit. “One of the reasons we’re looking at renewables and solar is that it reduces operating expenses and increases cash flow, a big deal to real estate owners.”
The Soleil project arrives at the intersection of trends: a transition toward cleaner, renewable power; the rapidly shrinking cost for batteries and energy storage, which dropped nearly 80 pc in the last decade, as per Boston Consulting Group; and a push by developers to reduce environmental footprint.
Patrick Sisson is a reporter with NYT
The New York Times
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