Swell will link batteries in 6,000 different homes to create a decentralized power plant for the local utility.
By Julian Spector, gtm
Hawaii’s largest utility enlisted a new tool in its quest for a carbon-free electricity system: thousands of batteries installed in people’s homes.
Hawaiian Electric won regulator approval for a $25 million plan to harness solar and batteries at 6,000 homes across the islands of Hawaii, Maui and Oahu. Venice Beach, Calif.-based startup Swell Energy will oversee customer outreach, installation and operation of the network, which will serve as a virtual power plant.
Once complete, the portfolio will supply 25 megawatts of solar power and 80 megawatts of battery capacity, which Hawaiian Electric can use as electricity during hours when grid demand surges, as well as delivering rapid-fire fast frequency grid response.
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The virtual power plant model offers homeowners backup power and power bill savings from self-supplying electricity for more hours of the day. The battery capacity is also available to the utility to deal with the systemwide challenges associated with the transition to cleaner energy. This requires balancing grid needs with ensuring that customers are backed up and fairly compensated.
“What do homeowners think about this? Folks dig it,” CEO Suleman Khan told Greentech Media in a December interview. “The dual use case is quite efficacious for both parties.”
This is still an emerging asset class, but last month Swell revealed it had raised a $450 million project finance fund from Ares Management Corp. and Aligned Climate Capital. The fund provides the venture-backed startup with low-cost capital to build out battery networks, in anticipation of the long-term contracted revenue Swell will earn from utilities once the fleets are operational.
