February 03, 2020

Sparks Are Flying: The Growing Tension between Energy Storage and Fire Safety Stakeholders

Abi Christoph


I. Introduction

In the winter of 2012, Hurricane Sandy struck the East Coast, bringing substantial flooding, power outages affecting over 8 million people, and over 70 billion dollars in damages. In New York City (NYC), the flooding caused a transformer in a substation in lower Manhattan to explode, plunging the financial center of the United States into darkness for several days. Since Sandy, local utility Con Edison (ConEd) has spent over one billion dollars in weatherproofing equipment (storm hardening) as well as carving up “distribution networks so that smaller sections can be shut off remotely when floodwaters rise.”

Another way in which NYC has tried to prepare for future storms as well as address high electricity prices, is through exploring the implementation of energy storage technologies that allow excess energy to be retained for later use during times of low or no generation. In 2016, NYC became the first city in the United States to set an energy storage target of 100 megawatt hour (MWh) by 2020. However, in the years since, progress toward this goal has been stifled by fire and safety hazard concerns. Recent NYC guidelines for outdoor energy storage make siting storage in an urban environment more complicated, and crucial indoor guidelines have yet to be released.

This paper explores how overly zealous and protective energy storage codes could ultimately work against the goals of consumers by demonstrating the complex relationship between energy needs, potential hazards, and regulation. Section II gives a brief introduction to energy storage. Section III provides an overview of NYC’s outdoor storage guidelines, and Section IV provides recommendations on how these codes could be improved upon. Finally, Section V concludes with a brief summary and forward-looking perspective.

II. Background on Energy Storage

A. Advantages of Energy Storage
For intermittent and non-dispatchable generation like solar or wind to provide a region with uninterrupted supply, energy storage is necessary. Storage provides crucial capacity firming, allowing renewable generation to sustain a committed output level for a specific period by storing the energy and then releasing it during the night or when weather conditions inhibit generation. The ability of storage to mitigate the intermittency of renewable energy through firming, is why storage is essential to a clean energy future.

In addition to capacity firming, energy storage can be used for several other applications such as peak shaving and resiliency, which are particularly important for New Yorkers concerned with storm preparedness and their high electricity bills. NYC has almost three times as many underground lines as it does overhead lines, and the high expense of the underground lines and dormant peaker plants contributes to NYC having some of the highest electricity rates and demand charges in the nation. Though energy storage has historically been viewed as uneconomical, advances in technology as well as NYC’s high demand charges make it viable there. In 2017, New York had the highest maximum demand charge in the United States of $51.25/kilowatt (kW), while in comparison North Carolina had roughly half that at just $25.65/kW. Demand charges are based on the interval of highest consumption within a month for a consumer. Therefore, a consumer who can install storage on their facility and smooth or peak shave their demand, will see lower demand charges and thus lower electricity bills.

Storage is tremendously important and now viable outside of peculiar places like NYC as well. A recent power purchase agreement (PPA) is a milestone in the changing economics of storage, as well as an indication of the trend for longer duration batteries. In 2018, Arizona Public Service (APS) finalized a 15-year PPA with First Solar in a stunning decision; First Solar’s solar plus storage proposal beat other technologies in an open bid process. APS had required the bids “to deliver power between 3 p.m. and 8 p.m. in the summertime.” Normally this type of restriction would favor traditional fossil fuel bids, natural gas specifically. However, First Solar’s solar plant will provide power during daylight, and the 50 megawatt (MW) battery will provide power at night for up to three hours. Not only was First Solar’s paired solution capable of meeting APS’s strict requirements, but it was also the most economical option.

B. Potential Hazards of Energy Storage
Storage encompasses a vast array of both proven and cutting-edge technologies from pumped hydro, flywheels, compressed air, thermal, and capacitors to the long list of battery technologies, of which lithium-ion (Li-ion) has become the front-runner. Each technology has unique characteristics, advantages, and restrictions, so matching the correct technology to the planned application and location is crucial.

As battery storage is the most mobile and modular of the different types of storage, and thus most suited to an urban environment such as NYC, all future references to storage in this paper will refer to batteries. Each type of battery has specific hazards, and there is variation within these types depending on the specific chemistry. For example, Li-ion is highly reactive to water and can self generate oxygen when overheated; however, certain types of lithium salts can be extinguished with water.

Though end-of-life disposal uncertainties are an ongoing concern, the key current concern for battery energy systems is thermal runaway and resulting fire. Upon some type of mechanical, thermal, or electrical abuse that damages the permeable membrane that separates volatile chemicals in a battery, energy can release in an uncontrollable manner known as thermal runaway. This is a sharp spike in temperature that changes conditions such that the temperature climbs further in a positive feedback loop. In addition to the intense heat from a battery fire, a battery can explode and cover the nearby area with sticky chemicals that cling to skin like napalm. A damaged battery can be fully extinguished and then later reignite if the internal temperatures are not brought down. Also, thermal runaway in one battery pack can propagate to adjacent packs in a rack, leading to a larger fire or explosion.

There have been at least three battery energy storage system fires. In 2012, a lead acid battery installation attached to a wind farm in Hawaii caught fire three different times, with the third fire burning down portions of the building and causing 30 million dollars in damages. Also in 2012, APS was testing a 1.5 MW Li-ion system when it caught fire and caused substantial damage to the nearby three-million-dollar substation. Not wanting to potentially destroy the other equipment in the substation, firefighters let the battery fire burn until APS workers could turn off the substation. In 2017, a Belgian utility’s Li-ion installation caught fire and resulted in a total loss to the unit. Most concerningly, the storage container had functional fire detection and extinguishing systems which failed to quench the fire.

Because storage is a rapidly advancing technology, there has not been as much rigorous testing as a technology with inherently dangerous components would ordinarily have. Thus, there is a growing concern for placing storage in urban settings like in a residential parking garage that are “outside the fence” of traditional energy infrastructure. Some opponents have likened it to being as dangerous and generally prohibited as storing highly volatile liquids like diesel, gasoline, or propane in one’s house.

However, placing utility-scale energy storage “behind the fence” in a faraway substation does not meet the needs of the consumers facing high electricity bills and potentially devasting losses from a power outage. And this is not merely a matter of convenience or economic loss. In 2017 after Hurricane Irma in Florida, a nursing home’s air conditioner lost power, resulting in 13 deaths despite the staff frantically contacting local utility Florida Power & Light, the state health care administration and then Governor Rick Scott.

On-site energy storage would likely have been able to mitigate the situation and potentially save lives. There is a reason why most if not all hospitals and other critical care facilities have on-site backup generators. However, in an emergency, obtaining fuel for generators can be difficult and storing volatile fuel onsite during unstable conditions like a major storm is essentially the same concern that opponents of storage have with placing storage in urban settings. Also, generator failure is possible as well. During Sandy, NYC’s public hospital system had to evacuate patients from two different hospitals due to diesel-generator failures. When considering that diesel generators are polluting, loud, fallible, and require the storage of volatile fuel, storage technologies would appear to be the preferable solution in many instances. 

III. An Overview of NYC’s Energy Storage Standards

As the greater populace has become aware of energy storage, fire departments and other city stakeholders have begun pushing for greater regulation of stationary storage. Several different industry codes relating to the individual components as well as implementation, maintenance, and siting of storage systems have now been published or are still in the process of being drafted. Understanding how these codes compare to each other and how they are affecting consumers is important. Bloomberg estimated that energy storage systems could become a 620 billion-dollar industry by 2040. However, there will be an increasing amount of inefficiencies and lost opportunities if stationary storage systems become overregulated due to exaggerated hazard risks.

Some of the most important storage standards include the still being finalized National Fire Protection Association (NFPA) section 855, which is a comprehensive approach to stationary batteries with an emphasis on Li-ion but also includes requirements for other chemistries like lead-acid, nickel-cadmium, sodium and flow batteries. NFPA section 855 is particularly important as many authorities simply adopt the generally regarded industry best practice NFPA standards as their own instead of creating their own separate set of standards. Other important industry standards include UL 9540A, IEEE C2-17, NECA 416-17, and IEEE 1653-2012.

Despite all of these existing standards, in 2018 the NYC building and fire departments, ConEd, City University of New York, and New York State Energy Research and Development Authority collectively developed and released their own set of stringent guidelines for Li-ion outdoor storage facilities. Neither NYC or this group have released guidelines for the more complicated indoor facilities or guidelines for any other battery type other than Li-ion.

The outdoor guidelines are supposedly streamlined and yet require four different approvals from three different authorities. This approval process also varies depending on the size of the installation. All storage installations will require an electrical permit that needs to be obtained before construction begins, and fees for this can range up to five thousand dollars. In order to obtain just the electrical permit, the plans must comply with the NYC Construction Code, NYC Electrical Code, and UL 9540A. The construction permitting process is even more onerous and requires things like determining whether the structure requires an asbestos inspection. The fees for this step are quite varied but will likely cost a few hundred dollars. Then the Fire Department of New York (FDNY) also must grant approval and may require an onsite inspection. This step will cost an additional $420.

Despite the numerous approvals and quite expensive process that would be basically impossible for an average consumer to navigate, the most challenging aspects of the guidelines relate to the siting requirements which mirror the latest NFPA section 855 draft standard in many aspects. Any installation must comply with NYC zoning requirements per zoning area and equipment category. There must be clearly defined egress points that are compliant with the Fire and Building Code. And importantly, any installation must be at least 10 feet away from any building, window, door, hazardous material and egress and exit points—unless the NYC Department of Buildings (DOB) grants a per project exception. If the installation is planned to be adjacent to a building, it must be under twenty kilowatt hour per installation (or seek a case-by-case approval), at least five feet away from any openings such as windows and doors (or install a one-hour fireproof barrier instead), 10 feet away from an egress point, and the adjacent building must be non-combustible (or cover the adjacent building’s nearby surface with a one-hour fire rated protectant).

These siting requirements are particularly onerous when considering that NYC is the most densely populated city in the United States with 27,000 people per square mile. Few places in the city meet this criterion, so essentially an installation would have to be placed remotely, not directly connected to buildings, or would need to be quite small. Case-by-case approval is not only uncertain, but an exhausting and expensive process. Major institutions such as hospitals might have the budget and access to lawyers and other industry professionals that this process implicitly requires to navigate, but average consumers would be pushed out either due to the upfront costs or impracticability of finding an adequate space.

IV. Considerations for Current and Future Energy Storage Implementation Standards

A more optimal approach to these storage installation guidelines would rely on a truly affordable and consolidated interconnection process with fewer authorities that need to grant approval. Currently, the standards reflect the type of hypercautious mind-set that one would expect considering they were drafted by a utility, university, research institute, and mainly by the NYC building and fire departments. Critically, the consumer advocate division of NYC’s public utility commission was not involved. Thus, while consumers might be very well protected, they might also be entirely unable to utilize and benefit from energy storage.

Creating a system that disfavors behind-the-meter energy storage does not serve the needs of consumers. Urban consumers are often located far away from the point of generation, meaning they are especially vulnerable in the event of a natural disaster or cybersecurity attack cutting off their supply of electricity. Attempting to place large-scale storage in the center of a city would mitigate this issue, but would be extremely costly due to the need to obtain land that would both be prime real estate and fraught with hidden underground obstacles. In 2014, ConEd estimated a single new substation near Brooklyn and Queens would cost over one billion dollars.

Additionally, behind-the-meter storage allows holistic solutions that encapsulate renewable generation and personal consumption. In 2018, Duke Energy worked with the University of South Florida in St. Petersburg to install a Tesla storage battery in a parking garage that is connected to a solar system on the roof of the garage.  The battery can either sell that power back to the grid or power the garage’s elevator, lights and electric vehicle charging stations.

Important requirements from other standards should simply be incorporated into a single, unified standard. Specialized standards that are tailormade for a specific location such as the NYC outdoor guidelines, should not also then incorporate other standards such as UL 9540A as that convolutes the process. Also, the spatial requirements and mandatory clearances certainly need to be reevaluated in light of the practical considerations of a densely populated, already built-up, urban environment.

For any standard to be useful, it must be timely. From a process standpoint, the NFPA standard was first drafted in 2017 and the final standard is expected to be published in 2020. Despite it going through revisions during that period, this is still a significant time delay—which cannot be afforded considering the rapid development of the technology. Similarly, NYC still has not released indoor guidelines after at least two years of development. Until the technology has fully matured, standards should be updated yearly.

Finally, likely the most egregious issue with the current guidelines is the silence as to the likely effects of climate change and increased flooding. DNV GL performed a case study of how much damage another Sandy would do to NYC at three points in the future based on sea level rise estimates from the United Nations Intergovernmental Panel on Climate Change. In all of the simulated future “Sandys,” the flooding reached two or three feet higher in coastal substations meaning a significant increase in damage to critical electrical infrastructure. This is especially concerning considering that Sandy was actually downgraded to a tropical storm before making landfall—meaning far stronger and deadlier hurricanes are actually likelier.

With higher and more damaging flooding likely in the future, storage guidelines need to consider where storage will be allowed and how it will be encased. Depending on the type of battery and chemistry, a battery that is touched by flooding can short and spark—and then continue to burn even when wet. Therefore, if storage is placed in a low-lying area susceptible to flooding, then maybe it needs a waterproof container. However, in the event of thermal runaway, the container needs to be accessible to water or whatever other method is employed to manage the fire. This is a complicated issue that cannot be simply ignored in the storage guidelines. 

V. Conclusion

While safety in densely populated areas is obviously paramount, there must be consideration to the needs of consumers as well. Energy storage is necessary in order for renewable energy to become the future of the United States and also to protect consumers against unnecessarily high utility bills and devasting human losses stemming from power outages. Therefore, the codes and standards that are being drafted and implemented now must keep both the consumer’s needs and safety at the forefront.

We are already surrounded by hazards of which we’ve learned to live. Many homes have natural gas; cars contain flammable gasoline. Storage guidelines need to be ever evolving to provide consumers with a similar baseline of certainty and safety, and yet also acknowledge that risk is a part of living well. The energy storage approval process should be affordable and streamlined. Storage standards should be appropriate to the technology, the urban setting, and the immediate need, as well as to potential future climate change. They should offer choice, instead of regulating to the point of prohibition.

    Abi Christoph

    Abi Christoph’s essay “Sparks Are Flying: The Growing Tension Between Energy Storage and Fire Safety Stakeholders” received first place in the 2019 Energy Law Writing Competition sponsored the Section of Environment, Energy, and Resources. Abi is a student at the University of North Carolina School of Law.