Making a Battery Energy Storage System (BESS) looks simple at first glance: battery cells placed in modules placed in racks inside climate-controlled enclosures integrated with power conversion units, transformers, and to the grid by a web of software and controls. While it seems intuitive, self-integration of BESS has not picked up around the world. Should India follow a different path, is a question worth exploring, as the country embarks on a large ramp-up of BESS in its power infrastructure.

About a decade ago, at the beginning of solar development in India, the self-integration of a solar power plant became a common and quite successful strategy for many solar developers. It was feasible and more cost-effective to choose the “nuts and bolts” to integrate the system. Suppliers assisted the process by designing components that were plug-and-play and voila, solar self-integration went mainstream in India. Drawing on this experience, developers in India are now applying the same enterprise to BESS and delving into self-integration.

Fluence’s 10 MW/10 MWh Project in Delhi was India’s first megawatt-scale grid-connected BESS. Located in Rohini in north Delhi, the system boosts efficiency and resiliency and ensures greater reliability for more than 2 million residents in the service area of the local utility – Tata Power Delhi Distribution Limited. Since the deployment of this system in India in 2019, many new players with different backgrounds including electrical contractors, solar EPCs, battery and inverter manufacturers, and software providers are attracted by the lure of adding BESS to their offering portfolio.

A major problem with this approach is that often these new players don’t have the long term strategy and the focus it takes to build an energy storage offering which is complex and has myriad risks associated with it. There have been a handful of small MW scale BESS pilots in India developed by highly qualified engineering teams of private developers and EPC companies on their own premises with their own capital but many of these systems are not working as planned. There have been safety issues exposing companies to a fire or an explosion risk. Other installations are lying incomplete due to issues in the supply chain.

There are yet others where the software is unable to integrate all the components in the overall solution. In a business environment where timelines are important, such risks in self-integra- tion should be closely evaluated. Based on our global experience, we have evaluated the risks of self-integrating a Battery Energy Storage System and published in this blog.

Integrating a technically complex & constantly evolving system of systems in a volatile & resource-constrained global supply chain environment

To an engineer, a car is an integration of engine, wheels, and controls inside an enclosure. Yet for the last 50 years since the emergence of automotive OEMs, no rational player looking to own a car has opted to self-assemble one. The reasons for avoiding the self-assembly of BESS are the same as for cars. Like a car, BESS too involves the integration of batteries in enclosures with inverters and controls. The enclosure must be strong but not too heavy, small to reduce cooling load but big enough to be serviced easily, modular but accommodating changes in battery modules, enable rapid charging and discharging of batteries yet be secured against gas leaks, fire, or even explosions. Each enclosure must be fitted with telecommunication capabilities, communicate its key parameters and take instructions from a complex web of software architecture that connects hundreds of such enclosures to tens of power conversion units operating as a single power asset, to the grid. The system, before it can be sold, and connected to the grid, must be approved by regulators for safety and performance based on multiple standards and codes. Navigating all this complexity over the last 10 years, major power sector companies have come out with their own BESS offerings offering choices to customers. Customers in India today have multiple choices of large, reliable suppliers to meet their BESS requirements.

The major benefit of working with an experienced technology provider is in their preparation for ensuring systems that are optimally designed, the right components are sourced and integrated and the final product is certified to meet qualification criteria. This entails stringent qualification and testing of each component, making sure it integrates seamlessly with the rest of the system before connecting to the grid. Understanding every part of the complex system and how it works together enables efficient root cause analysis when a system-level problem arises without which it becomes impossible to determine responsibility and fix the issue.

Strong technology providers use the experience as a feedback loop to constantly improve system design. Fluence, one of the world’s leading suppliers of BESS is now in its sixth-generation product and much advancement has been made in the generational changes to the software that powers its solution. Previous solutions deployed BESS in 60’ and 40’ containers, cubes, and inside buildings. These solutions had air-cooled and water-cooled batteries both NMC and LFP with smaller-sized string inverters and large central inverters. Fluence BESS Operating System architecture, which has been used in the industry for over 15 years is designed to accommodate all the changes that are made in the underlying equipment, so BESS is available to meet its operational guarantees. When issues affecting system performance are detected, they are resolved with key component suppliers that have been associated with the solution over a long period, thus making the final product a robust piece of engineering that has been proven on the ground in multiple environments with diverse customer requirements.

Fluence has gone above and beyond UL 9540A testing requirements, working with DNV, a risk assurance expert to execute a successful large-scale burn test design to evaluate an extreme battery failure event by triggering a significant portion of the battery into the thermal run-away. The testing showed that even under an extreme event, propagation is limited to the initial Cube.

In 2022, many industries witnessed one of the most challenging and volatile periods of supply chain disruption due to COVID-19 lockdowns and supply shortages. In 2023, as the competition between batteries and electric vehicles heats up, developers have to rely on BESS suppliers who have the capability and the intent to commit battery volumes to BESS projects. Experienced solution providers have experts who work together with product and commercial teams and cultivate long-term, collaborative, contractual partnerships across multiple suppliers. This ensures that their teams have the experience of dealing with challenges that could arise due to availability constraints and price volatility of BESS components.

As an example, Fluence’s global approach benefits from access to large purchasing volumes across multiple suppliers which helps it get priority in procurement. Large volumes also help it negotiate master services agreements to obtain the best possible product availability, pricing, and terms. Inexperience with complex details in the procurement terms, especially relating to warranty, cumbersome data requirements to meet warranty criteria- ria and dependence on user-profile can lead to unforeseen risks during operations. Over the last 15 years, we have worked through many challenges with suppliers and demonstrated a clear path for resolutions while maintaining a single point of contact for the customer.

Managing Safety effectively especially for large grid integrated BESS

Safety is a foundational element in energy storage system design starting from BESS design to vendor and equipment selection to fire prevention and safety measures in the BESS all the way through measures in case of a thermal runaway incident, a fire or an explosion. Self-integrators of lithium- ion batteries in BESS are ill-equipped to address the related safety issues. This inability has been seen in the frequent fires and explosions in much smaller battery packs in the range of 5 KWh – 50 KWh in electric scooters and electric cars in India, a possible reason for which could be the pressure to reduce time to market which may have led to shortcuts in battery integration with overall design. A similar safety incident in much larger BESS installations would be catastrophic. Such an incident will bring unexpected risks and international attention to the self-integrating party diverting its attention from their core task of project development and operations.

By taking a whole-of-system approach, Fluence embeds safety into every layer of technology, system design, and project design, and can continuously improve by incorporating the latest safety-related learnings. Fluence has also led the industry by going above-and-beyond minimum safety standards and working proactively with local fire authorities.

India, at this stage, is deploying high-capacity battery storage projects that have the eyes of the world. These projects would create high standards and it is very important that the initial project doesn’t get caught in a safety debate.

Optimizing lifetime ownership cost & ensuring long term sustainable operations

BESS is a 20-year investment that needs to operate as an integrated whole with multiple points of failure between the different components. Delivering energy storage projects is not just a question of optimizing upfront capital expenditure, it is as much about operating the BESS over 20 years while maintaining the operational guarantees of availability, capacity, and energy efficiency. India is the world’s third largest producer of renewable energy, with 40% of its installed electricity capacity coming from non-fossil fuel sources. India plans to have 500 GW of non-fossil-based power capacity by 2030 so that cleaner fuels comprise 50% of the power mix. This will lead to witnessing a once-in-a-lifetime paradigm shift in how the grid operates and the services needed to keep it reliable and secure. The policy framework is slowly evolving to meet the need to accommodate energy storage projects in the grid. This means the projects installed now would need to be upgraded to adjust to rapid changes in evolving grid support services. For reference, to learn from Australia, back in 2021, large-scale energy storage was required to undergo major software upgrades to be able to provide Primary Frequency Regulation to help correct minor deviations in local frequency.

Many more market changes may be expected on the horizon that will affect plant controls, software, and even hardware. Being able to adapt to new market conditions requires local market experts to maintain a proactive feedback loop with the global product, commercial, and software teams.

To address these risks requires diverse and multi-year knowledge of operating these assets. Fluence with its 15 years of experience operating BESS globally has advanced knowledge of causes for failure, failure rates, and planning required to fix them. We are already in the process of establishing service hubs in Rajasthan and Karnataka to service BESS assets. Our experience with BESS design and our capability to service these assets mitigates risk that will otherwise show up in the self-integration of BESS.

Battery storage is a mainstream infrastructure investment today. Conventional capital is evaluating BESS projects for risks with the intent of financing. It is important that the solutions deployed demonstrate a track record of performance over a period of time. Cyber risk to infrastructure investment is a potent threat that has manifested itself multiple times in India. The October 2021 power outage in Mumbai was attributed to a cyber-attack that originated in China. It is important that any integration strategy addressing cybersecurity risk includes inputs from stakeholders who are responsible for grid security.

India has the need to deploy a large amount of BESS in its national grid. It is incumbent upon the industry to do it responsibly. A nation’s power infrastructure is not the space for entrepreneurial risk. It is best to leave a critical asset like BESS in the hands of professionals whose job is to develop battery-based energy storage systems.

Does your Procurement method guarantee following requirements? Solution Provider Self-integrator

Safety

Ensures to meet the standard requirement through vendor selection and complies safety and reliability through the software. Unsure whether it will address all safety parameters at design stage and over the long term.

Future Compatibility

Takes a Global point of view.
Ensures that your system serves the purpose for which it is deployed for over the long term.
Solutions are designed in isolation.

Optimizes Operations Cost

Engages deeply via long-term service agreements to drive down the impact of O&M costs. Ad-hoc measures that are usually well managed.

Bankability

Fully bankable Undetermined
Authors:
Rupam Raja

Chief Commercial Officer

Rupam.raja@fluenceindia.in

Fluence India

Sanskriti Dubey

Senior Manager -Market Growth & Communications,

Sanskriti.dubey@fluenceindia.in

Fluence India