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Puerto Rico Could Show the Future of Solar and Energy Storage

By Travis Hoium - Oct 11, 2017 at 7:21AM

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If Puerto Rico can build a grid based on solar and energy storage, anyone can.

Elon Musk has gotten a lot of attention for his proposed efforts to rebuild Puerto Rico's electric grid, which could prove how cheap and valuable solar and energy storage could be in the decades ahead. Musk's plan isn't public yet, but it would likely mean bringing Powerpacks to the island to help deal with outages that still affect 90% of consumers. And this may be an instance where Tesla (TSLA -0.74%) could build a solution faster than most utilities. 

But Tesla isn't the only company eyeing solutions in Puerto Rico. Sonnen has said it will build microgrids on the island as well. This is potentially the first big test for solar plus storage as a fast solution to island infrastructure challenges. 

Large ground-mounted solar array with a wind turbine in the background.

With a little help from energy storage, renewable energy could be just what Puerto Rico needs. Image source: Getty Images.

How solar and energy storage could help Puerto Rico

There are two main problems facing Puerto Rico's energy infrastructure. First, when centralized power stations go offline during a hurricane they leave thousands, or millions, of people without power. Second, downed power lines can make an operational power plant meaningless because they aren't connected to the grid. It's this second problem that's the main issue for Puerto Rico today and in the long term. 

A grid with more solar and energy storage could reduce both problems in Puerto Rico. Solar arrays all over the island would spread out energy generation across the island, reducing the risk that one plant will go down. And to generate enough power for the entire island, about 9.1 gigawatts of solar would need to be installed, requiring about 72,800 acres, or just 3.3% of the country's land. Wind turbines, particularly offshore, could reduce that land usage as well. Puerto Rico could easily generate 100% of its own electricity, assuming it had enough energy storage. 

From a distribution standpoint, having a de-centralized grid would help the rebuilding process. It wouldn't stop blackouts completely, but if transmission redundancies are built into a grid based on solar and energy storage it could make blackouts less likely. 

It's not clear how much energy storage would be needed to keep Puerto Rico's grid operations -- since it's never been done -- but 55,000 megawatt-hours or about 250,000 Tesla Powerpacks would be a full day's storage. That's 426 times the size of the company's Australia project, so it's a lot, but not outside the realm of possibility. 

What's really going to happen in Puerto Rico

Anything like 100% solar or wind and energy storage would take years, or even decades, to implement given Puerto Rico's size. For now, we'll likely see smaller microgrids put up to ease pressure on the grid. And adding some solar to rural areas can provide a little bit of power to run things like hospitals, water pumps, and emergency lighting. 

Sonnen has said it will install microgrids at emergency medical clinics to help their operations. The company's specialty is residential energy storage systems, so it wouldn't be surprising to see them get thousands of smaller energy storage systems into the hands of people in Puerto Rico. 

We could also see a company like SunPower play a role in Puerto Rico, as it has in recent French West Indies and Corsica bids. The company is increasingly including energy storage with commercial and utility-scale solar projects. 

Tesla's ambitions seem to be much bigger. Musk has had discussions with the governor of Puerto Rico about revamping the island's entire grid, adding more solar and energy storage. That's a long-term plan, but won't be what gets the region up and running in the short term. 

Energy storage has a role to play in Puerto Rico

Whether short-term or long-term, energy storage has a big role to play in Puerto Rico and other islands around the world. And given the low cost of wind and solar, I think it's clear the island should revamp where it gets energy from. 

As wind, solar, and energy storage have come down in cost, they've made generating electricity locally more economical, which happens to be more reliable when there are disruptions as well. Maybe the next time a hurricane hits the Caribbean, energy storage will be able to keep some of the lights on and emergency services running.

Travis Hoium has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has a disclosure policy.

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