Alternative Energy and Battery Backup Systems Unlock Economic Value but Increase Risks
by Stephen Bushnell – Stephen Bushnell + Associates
According to the US Energy Information Administration, the installation of solar photovoltaics in the United States increased by more than 400% from 2010 to 2014 and there is every reason to think that this trend will continue. The inability of these systems to meet peak energy demand 24/7 has sparked new technologies for energy storage from residential to utility grid scale. Battery storage is one of the most intriguing solutions. While the cost remains high (as compared to more traditional sources of power) and a variety of regulatory and code barriers exist these are more and more solutions moving to the market. The growing focus on “net zero” buildings is a major factor in the interest in on site storage.
Rooftop solar pv systems bring significant economic and green value even without the round the clock flexibility that battery backup systems provide. They are not without risk however. The obvious weather risks of wind and hail can be addresses by confirming that the pv panels and mounting systems meet all current standards and that installation is performed by a qualified, experienced professional.
Recent large fire losses raise concern that first responders may not understand the nature of pv and how to fight fires, especially when they need to access the roof to vent smoke and dangerous gasses. If the pv installation is extensive and there is insufficient clear space on the roof for fire fighters tp wprk, they may not be able to properly fight the fire. They may also not know where and how to shut down the system. Proper labeling is critical.
California Department of Forestry and Fire Protection (Cal Fire) has addressed many of these risks in the publication, Solar Photovoltaic Installation Guideline. Other organizations such as the National Fire Protection Association and several model electric and building codes reference the Cal Fire guidelines. Local codes are evolving and may not reflect the best practices suggested by Cal Fire.
An additional risk management practice is to engage the local first responders to tour your facilities and become familiar with your pv system and how to shut it down if needed. You may already involve them in a similar way for your commercial automatic sprinkler systems. In this case, familiarity breeds safety.
Battery storage is probably a few years away from being economically viable at scales smaller than grid installations. Existing battery technology ranges from traditional lead-acid batteries, to emerging lithium-ion batteries, flow batteries (vanadium redix and zinc bromide) and even Sodium Sulfur batteries. Hybrid automobile batteries that are no longer powerful enough for their original intent are being repurposed for a second life as pv backup systems. Again, the green concepts of reuse and recycle will play a role in creative “cradle to cradle” rebirth of many components.
While batteries hold lots of promise for cost efficient energy storage, they also introduce new elements of risk that must be managed. There are three significant issues that arise:
- Batteries get hot and may combust. Recall the issue laptop computers bursting into flames as lithium ion batteries overheated. Thermal runaway is a significant concern for installation with several lithium ion batteries.
- Batteries contain dangerous chemicals that should not be released into the environment or contact humans and animals. Some technologies can release hydrogen gas that needs to be properly vented to avoid explosions.
- Power is always present. We are already seeing concerns with first responders over rooftop pv systems and fires in hybrid and electric autos. Adequate labeling, assessable shut offs and fire department training goes a long way to mitigate these risks. Adding batteries to the mix changes the risk dynamics. Firefighters might expect sophisticate battery arrays in industrial setting not in residential properties.
New technology almost always introduces new elements of risk. Tried and true risk management techniques can support our response:
- The battery storage room or container should be designed by professionals who understand the properties of the batteries involved and the risks they bring. The principal of separation is a good first step. The storage enclosure should be separated from the building by adequate clear space. If a fire or chemical release does occur it will not have an immediate impact on people or property. Of course, proper venting, chemical containment systems and even heat alarms should be included in the design.
- The room or container should be clearly labeled with easy to read instructions about how to shut down the power.
- You should make the local fire department aware of the battery installation. Again, on site visits to review the arrangement are helpful. Many cities have codes regarding rooftop pv installations and placement of storage sheds which should always be followed. Few have any requirements for battery storage installations.
We can expect rapid progress to be made in battery storage. Understanding the risks and taking the proper steps to mitigate them will go a long way to ensure that we will realize the economic benefits without unduly exposing lives and property.
For more on battery storage please see the following articles:
According to the US Energy Information Administration, the installation of solar photovoltaics in the United States increased by more than 400% from 2010 to 2014. While the cost of energy storage is currently prohibitive we can expect continued research and investment change the economic equations.
California utilities and private investors are breaking new ground in battery storage technologies.
New technologies designed to store clean energy may make it easier to fully incorporate solar and wind power into the electricity grid.
Energy naturally wants to spread out, so packing it into a small space like a battery or a fuel cell creates the risk of an uncontrolled energy release like a fire or explosion.
Stephen Bushnell is a highly experienced insurance and risk management professional with more than 40 years of leadership experience at various property & casualty insurers. Steve is widely recognized as a risk-focused expert on green buildings, sustainable manufacturing and operations, and the broader business, economic and risk management implications of climate, energy and other sustainability challenges.
Stephen Bushnell + Associates advises property owners and managers, public entities, manufacturers and other enterprises on the enterprise risk management best practices to enhance green buildings and sustainable operations.