By Patrick Sisson © The New York Times Co.
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 representative for a local tech firm, was a sleek, silent device: an energy storage battery.
Kannenberg’s home, such as every apartment in the $156 million, 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 more resilient power systems — recently 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 ATM 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.
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 VPP 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 several trends: a transition toward cleaner, renewable power; the rapidly shrinking cost for batteries and energy storage, which dropped nearly 80% in the last decade, according to the Boston Consulting Group; and a push by developers to reduce their environmental footprint.
“We are at a turning point,” said Mark Dyson, a clean-energy expert at RMI, a Colorado organization focused on sustainability. “Since price points have come down so much, especially for batteries, I’d expect a growing fraction of new homes will incorporate these technologies. Virtual power plants are the cheapest, most valuable thing to build next for the U.S. power system.”
Electricity use in buildings waxes and wanes throughout the day. Renewables and battery storage can smooth out that cycle, storing power when use is low and then tapping it during periods of high demand, keeping electricity costs down.
For Wasatch, Soleil Lofts offers both financial and marketing benefits. Potential tenants wooed by the complex’s green credentials are more likely to rent, and the entire structure has lower energy costs over time. The battery storage system has offset energy costs from common areas, Peterson said.
Wasatch plans to expand the Soleil model. A series of six pilot programs will roll out across existing properties in California, aiming to see if older buildings can achieve the same energy and costs savings.