PG&E, Tesla Break Ground on Landmark Battery Energy Storage System

SAN FRANCISCO–(BUSINESS WIRE)–On July 21, Pacific Gas and Electric Company (PG&E) and Tesla Inc. began construction of a 182.5-megawatt (MW) lithium-ion battery energy storage system (BESS) at PG&E’s electric substation in Moss Landing in Monterey County.

The system will be designed, constructed, and maintained by PG&E and Tesla, and will be owned and operated by PG&E. Construction is expected to continue into early next year. PG&E aims to have the system energized in early 2021 and fully operational in the second quarter of 2021.

Once operational, the Moss Landing substation system will be one of the largest utility-owned, lithium-ion battery energy storage systems in the world.

“Battery energy storage plays an integral role in enhancing overall electric grid efficiency and reliability, integrating renewable resources while reducing reliance on fossil fuel generation. It can serve as an alternative to more expensive, traditional wires solutions, resulting in lower overall costs for our customers,” said Fong Wan, senior vice president, Energy Policy and Procurement, PG&E. “The scale, purpose and flexibility of the Moss Landing Megapack system make it a landmark in the development and deployment of utility-scale batteries.”

PG&E forecasts the Moss Landing BESS will save more than $100 million over the 20-year life of the project, when compared to the forecasted local capacity requirements and associated procurement costs that would have been necessary in absence of the BESS.

Up to 50 PG&E employees and contractors will construct the system, and all COVID-19 safety protocols including a daily health check, physical distancing, and wearing face coverings will be followed.

The BESS was approved by the California Public Utilities Commission in November 2018 and by the Monterey County Planning commission in February 2020.

It includes installation of 256 Tesla Megapack battery units on 33 concrete slabs. Each unit houses batteries and power conversion equipment in a single cabinet. Transformers and switchgears will also be installed along with the Megapacks to connect energy stored in the batteries with the 115 kilovolt (kv) electric transmission system.

The BESS will have the capacity to store and dispatch up to 730 megawatt hours (MWh) of energy to the electrical grid at a maximum rate of 182.5 MW for up to four hours during periods of high demand. PG&E’s agreement with Tesla contains an upsize option that can increase the capacity of the system up to six hours or 1.1-Gigawatt hour (GWh) total.

The Moss Landing BESS will enhance reliability by addressing capacity deficiencies as a result of increased local energy demand. It will participate in the California Independent System Operator (CAISO) markets, providing energy and ancillary service — such as serving as an operating reserve that can quickly be dispatched to ensure there is sufficient generation to meet load — to the CAISO-controlled grid.

“Energy storage is critical in achieving California’s clean energy goals, and the California ISO looks forward to working with PG&E in advancing its storage projects,” said Mark Rothleder, vice president, Market Quality & California Regulatory Affairs, CAISO.

Energy storage has been a part of PG&E’s power mix for decades, starting with the Helms Hydroelectric Facility and continuing with the deployment of BESS projects such as the 2MW battery at its Vacaville Substation and the 4MW Yerba Buena battery in San Jose. In February 2017, PG&E deployed its first lithium-ion energy storage system, featuring Tesla Powerpack technology, at its Browns Valley substation (approximately 50 miles north of Sacramento).

California’s Energy Storage Decision (AB 2514), passed by the legislature in 2013, requires investor-owned utilities to provide 1,325 MW of operational energy storage capacity by 2024. PG&E’s share is 580 MW, and the Moss Landing substation BESS is one of many storage projects the company intends to deploy over the next few years.

As of May 2020, PG&E has awarded contracts for battery energy storage projects totaling more than 1,000 MWs of capacity to be deployed throughout its service area through 2023. Third-party owned projects include a transmission-connected 300 MW BESS (also to be located in Moss Landing), a transmission-connected 75 MW BESS located near the city of Morgan Hill, Calif, and a 2 MW BESS at PG&E’s Gonzales substation in the Salinas Valley. PG&E-owned projects include a 20 MW BESS located at PG&E’s Llagas substation in Gilroy, Calif.

One MW equals one million watts or 1,000 kilowatts. That’s roughly enough electricity for the instantaneous demand of 750 homes at once, according to CAISO.

In addition to front-of-the meter, utility-scale battery energy storage, PG&E also supports behind-the meter (BTM) energy storage solutions. To date, more than 10,000 PG&E customers (mostly residential) have installed BTM battery energy storage systems throughout PG&E’s service area totaling approximately 140 MW of capacity.

PG&E customers can find more information about financial incentives and rebates offered for installing new qualifying equipment for generating and storing energy through the Self-Generation Incentive Program at www.pge.com/SGIP.

About PG&E

Pacific Gas and Electric Company, a subsidiary of PG&E Corporation (NYSE:PCG), is one of the largest combined natural gas and electric energy companies in the United States. Based in San Francisco, with more than 23,000 employees, the company delivers some of the nation’s cleanest energy to nearly 16 million people in Northern and Central California. For more information, visit www.pge.com/ and www.pge.com/en/about/newsroom/index.page.

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