Danville City Council on Tuesday evening approved a battery energy storage project that officials say would save money for Danville Utilities and help lead to lower electric costs for consumers.
The project will install a large outdoor battery system at a Danville Utilities warehouse site at 864 Monument St. It will include containers about 20 feet long and 10 feet wide and several feet apart, but connected to a transformer.
The system will charge the batteries during off-peak energy use times when costs are lower and discharge electric during on-peak times when those costs are higher. The system will enable Danville Utilities to avoid transmission and energy capacity costs it must pay, Danville Utilities Director Jason Grey said last month.
It also would help lower costs for consumers by enabling the city to reduce its power cost adjustment, Grey said last month.
The power cost adjustment is a monthly charge that fluctuates based on the difference in power use month to month. The monthly base rate consumers pay is supposed to cover power supply costs and some of the distribution costs. But the adjustment is needed to make up the difference for what the base rate does not collect to cover those costs.
The 10.6-megawatt project would be constructed, owned and operated by Delorean Power in Arlington.
Danville Utilities plans to enter into a 20-year capacity agreement with the company and would not be responsible for capital costs or maintenance at the facility. The city would pay $4.25 per kilowatt per month, or about $541,000 in the first year of an agreement with the company. That annual cost would decrease slightly due to a 1.5% decline in battery capacity per year, Grey said last month.
Officials expect to save $1.2 million in transmission and capacity costs in the first year of the agreement. Grey projects to spend about $9.6 million over the 20-year agreement, and save about $48.3 million over the same period.
In other matters, Danville City Council wants to keep its May elections.
Council members unanimously voted Tuesday night to pass a resolution opposing Virginia Senate Bill 1157, which would require the state’s localities to hold their elections in November.