Following the Monterey County Planning Commission's Feb. 26 approval of the 182.5-MW Tesla Moss Landing Battery Energy Storage Project (Elkhorn), facility owner Pacific Gas and Electric Co. and technology supplier Tesla Inc. hope to begin building one of the world's most powerful battery systems at the California utility's Moss Landing substation by late March.

Almost five times larger than the largest existing U.S. battery array — LS Power Group's 40-MW Vista Energy Storage in San Diego County — the Moss Landing project should be operational by the end of 2020, said Paul Doherty, a spokesperson for Pacific Gas and Electric, or PG&E.

Located near the shores of Monterey Bay, the project is adjacent to Vistra Energy Corp.'s 1,020-MW natural gas-fired Moss Landing CC, where a separate 300-MW battery storage project is underpinned by a 20-year resource adequacy contract with the PG&E Corp. subsidiary. An affiliate of Vistra is developing that battery project, with operations anticipated to start in December 2020.

The facilities, both with four hours of energy storage capacity, are among several large-scale projects under construction or in advanced development that market observers believe will push annual U.S. battery additions in 2020 beyond 1,000 MW for the first time ever, and above 3,000 MW in 2021.

"If projections are correct, this will be a groundbreaking year," said Kelly Speakes-Backman, CEO of the Energy Storage Association, a Washington, D.C.-based trade group.

In 2019, the U.S. added 430 MW of large-scale and behind-the-meter energy storage, Wood Mackenzie estimated in December, up from 311 MW in 2018. The consulting firm expects annual additions to triple in 2020, Speakes-Backman told a U.S. House of Representatives subcommittee in February.

A recent S&P Global Market Intelligence analysis identified more than 1,500 MW of large-scale energy storage planned for completion in 2020 and over 3,000 MW in 2021. Lithium-ion batteries co-located with gas plants and solar farms in the Southwest account for the bulk of planned additions. Large-scale projects are also under way in Florida, Hawaii, New York, Oregon and other states.

'Real acceleration will start next year'

The surge is centered in California, where battery storage projects are augmenting or replacing gas generation as part of the state's efforts to balance variable solar and wind production and decarbonize its power sector.

AES Corp. last summer broke ground on the first 100-MW section of its planned 300-MW AES Alamitos Energy Battery Storage Array in Long Beach, at the site of the retiring 1,152-MW gas-fired Alamitos project, which is being replaced with a combination of batteries and another gas plant, the Alamitos Repowering project.

Southern California Edison Co., or SCE, has 20-year contracts for the new gas and battery facilities starting in April and December 2020, respectively.

Fluence Energy LLC, an AES joint venture with Siemens AG, is building the battery complex. The developer is sitting on 1,200 MW of energy storage orders, mostly new contracts added in 2019, AES President and CEO Andrés Gluski told analysts on a Feb. 28 earnings call.

Other groundbreaking projects also appear to be moving ahead in the state.

SCE, an Edison International subsidiary, has a 20-year agreement with Strata Solar LLC for its 100-MW Saticoy Battery Storage Project in Oxnard. The project is on track to meet a contracted December 2020 start date, according to Joshua Rogol, Strata Solar's vice president of energy storage.

Saticoy is part of SCE's strategy to boost reliability in its Moorpark subarea, northwest of Los Angeles, where it is replacing previously planned and existing gas capacity with energy storage and new transmission.

SCE has another 20-year contract with the Stanton Energy Reliability Center, a new 98-MW gas plant integrated with 20 MW of batteries under construction in Orange County, that also calls for operations to start this year.

While these projects represent the first wave of storage facilities at such scale, industry figures say they are forerunners of bigger things to come.

"Energy storage deployment will increase in 2020, but the real acceleration will start next year," said Felix Maire, a senior analyst at S&P Global Platts Analytics. The U.S. began the year with under 1,000 MW of total installed battery storage from large-scale projects. Platts Analytics forecasts that volume to rise to more than 13,200 MW by 2024.

S&P Global Platts and S&P Global Market Intelligence are owned by S&P Global Inc.