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Alaska electric utility pairs with Tesla for battery system

December 26, 2019 GMT

ANCHORAGE, Alaska (AP) — An Alaska utility is working with electric car maker Tesla to install an industrial battery system to quickly release stored power into grids, an official said.

Homer Electric Association announced the contract with California-based Tesla for the utility’s power plant in Soldotna, The Anchorage Daily News reported Wednesday.

The electric cooperative wants to replace natural gas-fired power for short periods and cut greenhouse gas emissions.

The Tesla components are expected to be installed in a battery energy storage system that should begin operating in fall 2021.

Tesla did not immediately return an email seeking comment.

Homer Electric’s service area covers the western Kenai Peninsula and includes 34,000 electric meters and 24,000 member-owners.

The battery system’s power can be delivered to its grid at a rate of 46.5 megawatts an hour and operate at that rate for two hours before it must be recharged, Homer Electric General Manager Brad Janorschke said.

The battery system is expected to increase the utility’s ability to provide power without disruptions, he said.

The system will be a backup source of energy that is available year-round and can feed power to the grid more quickly and efficiently than a gas-fired turbine.

“It will save significant dollars in fuel every year,” Janorschke said. “As gas prices escalate those savings will keep going up.”

The utility did not disclose the battery system’s cost, but Janorschke said it plans to pay for the system using financial reserves and debt financing.

Debt financing often involves issuing bonds to raise money from investors.